Tencent Holdings revealed it will focus on core businesses in 2023 with a main focus on short videos, according to Pony Ma, founder and chief executive officer of Tencent.
During an internal meeting at the town hall, Pony Ma said in her speech later published by Chinese media outlet Jiemian while reviewing Tencent’s cost-cutting efforts for its employees, want to improve work efficiency.
As reported by the South China Morning Post, Pony Ma’s speech was the result of months of efforts to cut costs. These efforts have resulted in workforce cuts and the closure of certain businesses in the face of economic and regulatory uncertainties that have affected business segments such as video games and advertising. . Tencent’s game segment will be significantly affected because it cannot invest as much as before. Many game projects such as Tan Thien Long Bat Bo Mobile (in cooperation with Sohu’s Changyou) have been delayed for nearly 2 years and have not yet been released.
Tencent doesn’t invest much in games in China.
Pony Ma clearly told employees at Tencent: “Please don’t tell me the opportunities you pass by. How big a business grows depends largely on the dedication of its employees.” He added that the company has been delisting some of its investment portfolios for quite some time. But now must continue to cut costs and look for core areas instead of expansion. “In the past, when seeing other people expand their investment, the company also focused on open investment, but the result was nowhere,” said Tencent CEO.
The Chinese business analyst asserted that any business segment could be cut if it performed poorly. Tencent recorded a 2% drop in revenue in the third quarter, which is only the second quarterly decline since the company was listed in 2004. Tencent made the decision after the Chinese government’s regulatory oversight into the game industry.
Tan Thien Long Bat Bo was delayed in launching.
Tencent’s core gaming business has been hit by a slowing mainland economy and continued regulatory scrutiny by the Chinese government. To make up for recurring losses, the company has sought growth abroad, through investments and partnerships. The airline has cut a total of 7,377 jobs since the first quarter, according to a September 2022 report.
The major reshuffle that took place at Tencent News made it profitable in October. Chinese media reported that there had been major job cuts in the news and sports sections.
Pony Ma has continued to encourage employees to focus on product development instead of gaining market share through projects that hurt profits. He also criticized costly customer acquisition efforts and warned against chasing competitors into non-essential new businesses. He said cost-cutting efforts have seen some improvement and those measures will continue next year.
