HomeNewsTencent announces layoffs first time in 10 years, fires nearly 5,500 employees

Tencent announces layoffs first time in 10 years, fires nearly 5,500 employees

The Chinese company Tencent has laid off 5,500 workers after reporting a quarterly revenue of $19.8 billion, down 3% from the previous quarter and the first loss since coming public in 2014. 

According to South China Morning Post, the largest Chinese video game & social media company laid off over 5,500 workers in the second quarter as the country’s economy was down. 

For the very first time in 2014, Tencent has reduced the size of its workforce, announcing at the end of June that the number of workers would be reduced to 110,715 from 116,213 at the beginning of the year. 

The Tencent chief executive and founder Pony Ma Huateng said: “During the second quarter, we actively exited non-core businesses, tightened our marketing spending, and trimmed operating expenses, enabling us to sequentially increase our non-IFRS earnings, despite difficult revenue conditions”.

Analysts had predicted 25 billion yuan in net profits for the time, whereas the actual figure was 18 billion yuan, which was below their expectations. 

Meituan is one of China’s leading food delivery companies, and reports recently that Tencent is thinking about selling a portion or all of its 17 percent stake in the company. 

During Wednesday’s earnings call, the business, however, rejected such reports. 

While this was going on, other major tech firms like Google laid off workers, citing the current economic climate and the need to restructure the company. Alibaba, another major Chinese technology firm, has lately eliminated the jobs of roughly 10,000 people as part of cost-cutting estimates amid the slowing economy. Following these layoffs, Alibaba also trimmed its entire headcount to approx 2,45,700. 

According to a comprehensive survey provided by Crunchbase, other IT companies, primarily based in Silicon Valley, laid off more than 32,000 workers last month. 

Companies like TikTok, Twitter, Shopify, Netflix, & Coinbase are just a few examples. 

Google and Apple have both just declared that they will be freezing new hires and laying off employees. Sundar Pichai, CEO of Google, recently stated in an interview that the company had too many workers but too few tasks, and he asked all workers to work better than before. Pichai encouraged workers to get the best output and asked for ideas to get better results faster. “There are real concerns that our productivity as a whole is not where it needs to be for the headcount we have,” he said.


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