In a recent Reuters report, it was revealed that Tencent has become the latest tech giant to scale back its plans for the metaverse as it steps back from creating virtual reality hardware.
The company has also implemented headcount and cost cuts in its metaverse unit. Tencent had previously planned to build software and hardware for the nascent industry, but has now decided to reduce the size of the unit, which was launched in June and had around 300 employees.
Despite the cuts, Tencent says it will not disband the unit completely. The report highlights the need for profitability and the cost of investment as reasons for the reduction.
This move follows similar announcements by other major tech players, such as Microsoft, who revealed in January that they would be ending some of their VR products as metaverse-adjacent teams faced job cuts.