Layoffs have hit the tech industry hard in 2023, and now another round of layoffs are hitting even more employees. The latest company to lay off employees is ByteDance, owner of TikTok. The ByteDance layoffs, which are expected to officially be announced today, will hit employees working for its Nuverse gaming division.
TikTok parent company ByteDance is laying off hundreds of jobs in its gaming division, as per a person familiar with the matter. The ByteDance layoffs is marking a significant retreat from a segment it has invested billions of dollars in to challenge market leader Tencent.
ByteDance job cuts
“We regularly review our businesses and make adjustments to center on long-term strategic growth areas. Following a recent review, we’ve made the difficult decision to restructure our gaming business,” as per a ByteDance spokesperson on ByteDance job cuts.
ByteDance job cuts are mainly going to affect gaming division called Nuverse. Hundreds of employees are expected to be laid off from this unit, a person familiar with the matter said. According to the report, ByteDance will wind down its Nuverse gaming division after the fledgling unit has failed to compete with other mobile gaming giants like NetEase and Tencent. Nuverse will not shut down completely but will be significantly scaled back, the person said.
ByteDance has also told employees to stop working on unreleased games, the person said.
Jobs in gaming unit hit hard
ByteDance’s gaming ambition has been an expensive, short-lived pursuit.
The ByteDance layoffs will reportedly affect “hundreds” of employees, but just how many is unknown. A 2021 report from TechCrunch said ByteDance then had around 3,000 employees working in its gaming division. The cessation of its gaming ambitions hits especially hard considering the company bought a mobile gaming studio called Moonton Technology just two years ago for a staggering $4 billion. According to CNBC, ByteDance is now looking to sell Moonton.
ByteDance ingress in gaming world
Over the past few years, ByteDance has made an aggressive push into gaming in a bid to challenge other gaming giants like China’s Tencent and NetEase
ByteDance acquired a major mobile gaming studio called Moonton in 2021 for a reported $4 billion, underscoring its ambitions. The company is now looking to sell Moonton.
ByteDance layoffs as unable to sustain
The retreat comes after a tough couple of years in China’s gaming market which has failed to recapture the heights reached during the peak of the Covid pandemic when people were shut indoors and playing games. The industry has also faced a tough regulatory environment, although that has eased of late.
Success in the gaming sector is hard as it relies on a company creating a steady stream of hits, as well as titles that keep players hooked. Tencent, which is the operator of China’s biggest all-in-one app WeChat, publishes Honor of Kings for example, which is among China’s biggest games.
ByteDance has had some popular releases, for example with Crystal of Atlan, a role-playing action game, but appears to have struggled to turn that into commercial success.
