Alibaba Lays off Dozens of Employees at Its Metaverse Unit

posted  15 hr ago
Alibaba, a major China-based e-commerce company, is cutting down jobs in its metaverse department, Yuanjing Shengsheng.

According to the South China Morning Post, sources familiar with the situation reported that these layoffs are part of Alibaba’s broader restructuring efforts to optimize operations. The cuts have impacted Yuanjing’s offices in both Shanghai and Hangzhou.

Alibaba Group. Source: alibabagroup.com

Alibaba Group. Source: alibabagroup.com

Alibaba founded Yuanjing in 2021 to explore the gaming potential of the metaverse, raising billions of yuan in investments. According to local media reports, the company hired a few hundred workers for the unit at the time.

Sources said that although the e-commerce company has downsized its metaverse unit, it will continue to exist and develop metaverse-based apps and tools.

Alibaba isn’t alone in reallocating resources away from the metaverse, as other tech companies increasingly shift investments toward artificial intelligence (AI). 

In October 2023, Meta announced layoffs within its Reality Labs division, which focuses on the metaverse. Meta has also been actively building AI products, releasing the LLaMA generative AI model in February 2023 to compete with systems like ChatGPT and Claude. Currently, Meta is also working on its own AI search engine to reduce dependency on Google and Microsoft.