Tencent – one of the world’s biggest game publishers – has scaled back plans to take on the metaverse with its own VR hardware.
According to a new report by Reuters, the Chinese company is set to trim back its plans and personnel by “cut[ting] costs and headcount” at its “extended reality” XR unit. It’s unclear how this will impact the 300 employees currently working in the department, which was only set up in June last year.
Whilst Tencent isn’t talking publicly about the changes beyond admitting that it was “making adjustments to some business teams”, sources close to the situation report that part of the issue is the lengthy process of making hardware profitable. Internal forecasting reportedly confirmed that developing and selling its own VR system is unlikely to become profitable for Tencent until 2027.