(Yicai Global) May 9 -- Shares of Douyu International Holdings, a Chinese video game streaming giant backed by Tencent Holdings, sank after China’s top internet regulator said it would conduct a month-long on-site investigation following the discovery of indecent content on the platform.

Douyu [NASDAQ: DOYU] closed down 2.7 percent at USD1.08 a share in New York yesterday, after sinking by as much as 14 percent in pre-market trading.

The Cyberspace Administration of China sent a working group to Douyu yesterday to help the Wuhan-based firm rectify the issues, which include the dissemination of pornography.

The CAC said it had summoned the bosses of online platforms such as Baidu, Sina Weibo, Douyu, and Douban about transgressions, like the spreading of pornography, redirecting visitors to gambling, and usury, caused by the platforms’ failure to manage user-posted content. It told them to rectify the issues within a fixed period of time and deal with related user accounts and also fined the responsible people.

Douyu went public in the United States in 2019. Last year, it posed CNY7.1 billion (USD1 billion) in operating revenue and CNY7.7 million (USD1.1 million) in adjusted net loss. In 2021, it reported a net loss of CNY620.2 million (USD89.6 million).

Editors: Shi Yi, Futura Costaglione