Regulatory crackdown in China: Huya lays off hundreds of employees

Huya (HUYA.N), a Chinese video game streaming platform, has begun laying off employees, according to three persons familiar with the situation, as more Chinese technology companies scale back following a brutal government crackdown.

Huya, which is controlled by Tencent Holdings and was formerly part of a plan to establish China’s equivalent to Twitch, plans to let off hundreds of employees, according to the sources.

With major employee layoffs already imposed, the company’s Nimo TV unit, which launched in 2018 as an international version of Huya, is the most heavily impacted.

According to Huya’s most recent annual report, the company has 2,075 workers in 2020, making it one of China’s top video streaming platforms with rival DouYu.

“In light of changing market conditions, Nimo TV has made some strategic business adjustments and optimizations, and will devote resources to key regions in the future,” a Huya spokeswoman said, declining to comment on layoffs in other divisions of the company.

Last year, Beijing halted Tencent’s attempt to join Huya and DouYu to create a $10 billion video game streaming juggernaut as part of a regulatory crackdown.

Since then, Chinese regulators have tightened their grip over the livestreaming business, and Tencent’s in-house video game streaming unit Penguin Esports was shuttered earlier this month.

Local media reports like as Tech Planet first reported Huya’s layoffs, claiming that Huya’s major competitor, DouYu, is also laying off a large number of people.

According to media, Douyu is not performing large-scale layoffs at the moment, but is making standard personnel modifications to optimize resources.

Other Chinese digital behemoths, such as Alibaba and Tencent, have been laying off workers as a result of new rules that prohibited some of their old business practices and limited their expansion options.

The Chinese social e-commerce platform Xiaohongshu, dubbed China’s Instagram, announced last week that it had reduced its workforce by around 9%.

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