Tencent Holdings ADR (TCEHY), the Chinese tech giant, has publicly denied rumors of impending layoffs and company restructuring. This statement comes in response to an internal email that leaked, revealing significant personnel adjustments within the company. The email disclosed that Zeng Yu, vice president of Tencent Interactive Entertainment Group (IEG), would be stepping down from his leadership positions within the IEG and the Technology & Content Platform.
While acknowledging the leadership changes, Tencent has emphasized that the impact is limited, affecting only “more than 10 individuals.” This directly contradicts earlier reports suggesting the company might merge teams and lay off approximately 1,200 employees, representing 20% of its workforce. Furthermore, Tencent has debunked rumors of a 30% staff cut at its LightSpeed Studios. To further dispel concerns, the company highlighted that its subsidiary, TiMi Studio Group, is actively recruiting new staff. TiMi Studio Group, with its 13 studios and workforce of around 6,000 employees, is a major player in the mobile gaming industry.
These leadership changes come at a time when Tencent is reportedly engaged in discussions with Guillemot Brothers Ltd. regarding strategies to stabilize Ubisoft Entertainment SA (UBSFF). Ubisoft is facing several challenges, and these discussions could potentially lead to a buyout of the publisher, taking it private. This move could be a significant shift for the gaming industry, potentially altering the landscape of game development and distribution.
Tencent’s stock currently trades at $53.82, down 0.49% in the past 24 hours. The company’s commitment to deny rumors of widespread layoffs and its focus on hiring, especially within its gaming division, suggests that Tencent is prepared to navigate the current market challenges and continue its growth trajectory. The company’s potential involvement in Ubisoft’s future is a major development to watch closely, with implications for the entire gaming industry.
