Bloomberg: Epic Games Pivots to "AI First" Development, With AI Writing All Code for the Disney Shooter and the Project Delayed Indefinitely

Around October 12, 2026, Bloomberg reported on Epic Games, and Ars Technica relayed it: the Unreal Engine maker is shifting to an "AI first" development strategy. For its collaboration with Disney, a Marvel- and Star Wars-themed shooter, AI models would write all the code and guide all the art. The sources are unnamed people familiar with the project, and Bloomberg also viewed internal messages among Epic employees. So this is a report not confirmed point by point by the company, and everything below should be read as "according to the report".

The details first. According to the internal messages, the human developers' role becomes managing and guiding the code and art assets generated by models such as Anthropic's Claude. The wording is blunt: "no more hand-written code," and art assets "generated with full AI workflows." That is a concrete production rule, not a soft encouragement to use AI helpers. For a large game team used to people writing code line by line and drawing art frame by frame, such a change touches job design, review processes and accountability, none of which move by memo alone.

Now the project itself. The Disney game is part of a $1.5 billion collaboration announced in early 2024, and it was slated for release in March 2027. Per the report, it is now delayed indefinitely, citing the AI-related shake-up and also understaffing and slower-than-expected development. An Epic spokesperson said: "We're embracing AI-accelerated development, led by Epic developers who are the visionaries and creative drivers for everything we do." CEO Tim Sweeney wrote on social media shortly after the Bloomberg story that there is "a huge pivot underway here at Epic," moving developers around to retool for "maximum AI acceleration," and that "the aim isn't to do the same stuff with fewer people, but to enable everyone here to build MORE and BETTER stuff, and to bring the benefits to all teams using Unreal."

The direction is no surprise. Ars Technica recalls that Sweeney and Epic have long been bullish on an AI revolution in game development. In an IGN interview in June he saw "the possibility of infinite dialogue with a really simple setup for creators" and small teams building games with immense numbers of characters and interactive worlds. Last November he said AI disclosure tags like those Valve requires on Steam "make no sense," because AI tools will be involved in nearly all future production. On the other side, Epic laid off over 1,000 employees in March, citing a downturn in Fortnite engagement. Months later a Fortnite senior external development manager said everyone's biggest fear is that AI will take all their jobs, and that the goal is efficiency instead. Last May, Epic and Disney were embarrassed when an AI-voiced Darth Vader in Fortnite began repeating curse words and uttering baffling opinions before a hotfix.

Keep a sense of proportion with industry context. Ars Technica cites a survey of over 2,300 game industry professionals taken ahead of this year's Game Developers Conference: 36 percent used generative AI as part of their jobs, including 30 percent of those at game development studios. But those tools were used mostly for research and brainstorming (81 percent of AI-using respondents), well ahead of code assistance (47 percent) and prototyping (35 percent). In other words, the mainstream use today is assistance, not letting AI write all the code. If Epic really goes with "AI writes everything," it is far ahead of its peers on that curve.

Our reading is that this is an experiment that later facts can test. If the game ships late but with measurable changes in quality, cost and team structure, the industry gets first-hand data. If the schedule only slips further, it becomes a reality check for "AI first". Three caveats: the core information comes from anonymous sources and quoted internal messages that Epic did not confirm point by point; the delay is attributed to understaffing and slow progress as well, so it cannot simply be pinned on AI; and the report offers no metrics linking "AI writes all the code" to game quality. Until those exist, it is safer to read this as a company's strategic pivot than as a proven technical success.