Baidu has apparently laid off more than 100 employees in China, following the recent regulations from the local government that are cracking down on the Chinese video gaming industry.

According to a SCMP report, two sources close to the matter have revealed that the Chinese online search engine giant is currently downsizing its video gaming unit to cut down on losses over Beijing’s “anti-gaming” regulations. As per the two sources, the decision was announced to some employees within the gaming unit earlier this week, although, the exact number of staff being laid off is unknown at the moment. Baidu has yet to publicly comment on this news as of right now.

The move by the company also highlights the negative impacts on the gaming industry in China as the government cracks down on video gaming in general. The government has restricted the gaming time for teenagers under the age of 18 to a maximum of three hours per week, while also suspending new gaming licenses since the end of July. During the latest quarter, the tech giant saw a net loss of a notable 16.6 billion Yuan (roughly 2.6 billion US Dollars), after investing around 18.9 billion Yuan (roughly 3 billion US Dollars) as per a recent financial report.

As the firm pulls away from gaming, it is now shifting its investment into “hard tech” sectors such as autonomous vehicles and the semiconductor industry. Although, both these segments require years if not decades of investment before turning a profit owing to the technical complexity and rising competition.

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