Reuters, citing sources, said Alibaba and Tencent are preparing to cut jobs this year, in what will be the largest of them, amid sweeping regulatory blows in China.
Although Alibaba has not yet set a target for layoffs across the group, sources estimate that 15% of the group’s workforce, or about 39,000, may eventually be cut. In addition, Tencent said it will lay off employees in some business units this year, such as the number of video streaming media and search departments will be reduced by 10% to 15%.
The report said the layoffs at the two companies were the first large-scale layoffs since Chinese authorities cracked down. Hit by regulators and China’s slowing economy, revenue growth for most internet companies has slowed sharply, and share prices have been falling, making it more difficult to raise capital and expand operations, forcing companies such as Alibaba and Tencent to look for ways to reduce operations. cost method.
It is reported that Alibaba started laying off employees last month and discussed layoffs with some business units and asked them to formulate specific plans. Among them, businesses such as food delivery and map services such as Ele.me will lay off up to 25% of employees, but Alibaba Cloud employees have not yet been notified.
As for the Tencent part, sources revealed that the layoffs started from low-profit or loss-making businesses such as Tencent Video and Tencent Cloud. Tencent CEO Ma Huateng mentioned at an internal meeting last year that the company should prepare for “winter”.
Alibaba and Tencent did not respond to Reuters for the report.
In addition to the two tech giants, Didi Chuxing is also rumored to be laying off 15% of its workforce due to regulatory hits on its domestic business and cybersecurity investigations since its listing in the U.S. It is now rumored that the company is targeting completion by the end of March Layoffs, which Didi did not respond to.