(Yicai) June 25 -- Shares of Perfect World plunged after a media report claimed the Chinese game developer launched a mass layoff.

Perfect World [SHE: 002624] was trading down 6.2 percent at CNY7.28 (USD1) as of 2.10 p.m. in Shenzhen today.

Perfect World will let go employees at its Beijing, Shanghai, and Chengdu branches and implement related strategy adjustments, The Paper reported today, citing an insider at the Beijing-based company. The layoff will affect all businesses except e-sports.

According to The Paper, Perfect World has been downsizing since last year.

The layoff is not a surprise, given Perfect World’s lackluster performance in several game projects in recent years, The Paper said, citing a gaming industry expert.

Perfect World’s net profit shrank 64 percent to CNY491 million (USD67.6 million), and its revenue rose 1.6 percent to CNY7.8 billion (USD1.1 billion) last year from the previous one, according to the company’s 2023 earnings report.

Some leading gaming developers, including Microsoft, Sony, and Riot Games, have been downsizing their game businesses this year, the above expert noted. China’s ByteDance is also adjusting its game projects, as the industry has entered a consolidation period, making companies focus more on quality games and change their strategies.

Editor: Futura Costaglione