ByteDance is set to cut several hundred jobs in gaming, unwind projects under development, and weigh potential sales, in a major withdrawal from the gaming sector.
The company has plans to announce the new move soon, which will mark ByteDance’s biggest retreat from the gaming industry, which is now dominated by Tencent and NetEase.
Known for platforms such as TikTok, the company has slowly pulled back gaming ambitions after COVID, as it failed to gain market share from Tencent.
It’s also considering selling Shanghai Moonton Technology Co., which is a high-profile studio acquired for $4 billion in 2021.
A ByteDance spokesperson said, “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.”
The company was founded over a decade ago, and grew into an internet leader that was worth over $200 billion. Recently, it purchased studios and exclusive distribution rights to titles, in an attempt to jump into the games industry.
The pullback comes as the Chinese mobile gaming sector is struggling to regain the heights seen during COVID. Tencent however, has managed to continue growing, driven by its portfolio, and consumption in cheaper segments including online entertainment.
Since last year, ByteDance began to close in house studios and cut development jobs, following a shift in focus to core businesses including short video. This month alone, the company laid of a quarter of its staff.
Despite all efforts, Tencent remains the leader in the sector, benefiting from user traffic flowing through WeChat.
