Chinese wireless value-added services firm KongZhong (KONG) says it is eliminating 15% of its workforce.
Commenting on the event, Yunfan Zhou, Chairman and Chief Executive Officer, said, "It is unfortunate that we have to let some people go in response to the changes in the market environment. I would like to thank all of our employees for their dedication and hard work. Although we are going through a difficult time, we will continue to focus on our two major businesses – wireless value added services and wireless internet portal. We strongly believe in the long term prospect of wireless Internet and are confident we will continue to be one of the market leaders in China."
In response to new policies issued by the telecommunication operators in China, KongZhong Corporation lowered its 2006 revenue guidance on July 7, 2006.
To reduce cost and improve operational efficiency, KongZhong says it initiated a headcount reduction program and is in the process of reducing its workforce by approximately 15%. The company had 1,016 employees at the end of June 2006. The company plans to complete the headcount reduction program within two weeks.