- by Mariko Oi
- Business reporter
ByteDance has confirmed that it will significantly scale down its gaming business following reports of job cuts.
The Beijing-based company, which also owns popular social network TikTok, entered the gaming market in 2019 to compete with industry leader Tencent.
But it failed to gain market share.
The BBC understands that games with active players, such as Crystal of Atlan and Earth: Revival will continue. Unreleased titles will be discontinued in December.
This decision will likely affect hundreds of employees.
A ByteDance spokesperson told the BBC that the company regularly reviews its business and that it had “made the difficult decision to restructure its games business”.
The global video game market was estimated to be worth $217 billion last year, according to the market research and consulting firm. Grand View Research.
ByteDance’s creation of its Nuverse games division in 2019 was widely seen as a major boost to a once booming sector.
In 2021, the company officially became one of six business units undergoing a broader structural reform.
To increase production capacity, Nuverse has acquired external studios such as C4games.
But Nuverse’s performance was inconsistent, and none of its games became commercial hits.
The latest move marks a retreat from the competitive video game sector.
ByteDance’s competitor Tencent is the world’s largest gaming company in terms of revenue.
Founded in 2012, ByteDance created the global viral sensation TikTok with an estimated 1.1 billion monthly active users.
Its widespread popularity means it has come under scrutiny by governments around the world, including in the US and China.
During his term, US President Donald Trump frequently attacked ByteDance, accusing TikTok of being a threat to US national security.
Politicians and officials have expressed concerns about users’ personal data being transferred to the Chinese government.
TikTok has denied accusations that it shares user data but its CEO Shou Zi Chew faced hours of questioning at a US congressional hearing in March.
Pressure is growing on ByteDance to sell off its stake in TikTok or risk facing a ban.