Chinese tech giant ByteDance, which created TikTok, is reportedly planning to shut down its game development and publishing division Nuverse along with firing hundreds of employees in its gaming division.

The announcement for the same is expected today, as per people aware of the matter. “We regularly review our businesses and make adjustments to centre on long-term strategic growth areas. Following a recent review, we’ve made the difficult decision to restructure our gaming business,” said a spokesperson for ByteDance to Reuters.

This comes as a big retreat by ByteDance from the gaming market, which is considered to be the fastest growing sector worldwide, leaving the field open for its rivals Tencent and NetEase Games. Notably, Tencent is currently the biggest gaming firm.

Founder over a decade ago, ByteDance made a name across the globe mainly through TikTok, providing short-form videos. The app became so popular that other companies like Facebook and YouTube introduced similar video formats to retain users.

Soon the company invested in the gaming sector. However, after Covid-19, it struggled to bounce back as the gaming sector can be uncertain at times if the players do not like the games.

The reports of lay-offs are not the first, as the company has been slashing jobs and shutting down in-house studios with an aim to shift focus to core businesses after it failed to compete with behemoths like Tencent, boasting a huge portfolio of successful games.

However, TikTok has also faced criticism across multiple countries. Some accuse the app of stealing user data. Due to this, many have banned the application, including India and Nepal. Plus, many others have restricted government personnel from using TikTok as well.