Shares of Jack Ma’s e-commerce giant Alibaba Group were left bleeding yesterday as they fell more than 4% after a big shakeup of the top management.
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Alibaba Group’s Surprise Shakeup
reuters
In a surprise move, Alibaba group is replacing eight-year veteran chief Daniel Zhang at the helm of a Chinese e-commerce leader bleeding market share and struggling to revive growth in the post-Covid era.
Executive Vice Chairman Joseph Tsai, who is a longtime confidant of billionaire co-founder Jack Ma, will take Zhang’s position as the chairman of the board.
On the other hand, Eddie Wu, who is currently chairman of Alibaba’s core Taobao and Tmall online commerce divisions, will take over as CEO of the over $200 billion company.
Outgoing chief Zhang’s unexpected departure comes after Alibaba announced a six-way restructuring to try and boost growth and create a family of standalone leaders in businesses from cloud computing and logistics to international commerce. It is expected to go for separate IPOs too.
He unveiled his grand vision in detail just as Alibaba posted its third consecutive quarter of single-digit revenue growth, reinforcing concerns that a Chinese consumer spending rebound may be farther out than anticipated, as per Bloomberg.
The two top executives are Alibaba veterans and also close confidants of Alibaba’s billionaire founder Jack Ma.
But who are they exactly and what do their new roles signal about Chinese e-commerce giant Alibaba’s future?
Also Read: Alibaba To Split Its $220 Billion Empire Into Six Businesses
Jack Ma’s Two Confidants To Head Alibaba
Eddie Wu, incoming CEO
itvoice
Eddie Wu is one of the co-founders of Alibaba, who first served as its technology director back in 1999. His experience is in the company’s core e-commerce business, monetization and technology, making him a well-rounded candidate to oversee the entire group.
After Alibaba decided earlier this year to split into six units, Eddie was appointed as the chairman of the Taobao and Tmall Group — previously, the two units were the two biggest e-commerce services in China.
Also, Wu has been the chief technology officer of key businesses including Taobao and Alipay, the mobile payments service run by Alibaba affiliate Ant Group. He was in charge of Alibaba’s monetization platform on Taobao and Tmall, as well as directing efforts to push the Taobao mobile app that propelled the company into the smartphone era, a CNBC report mentioned.
Joe Tsai, incoming chairman
NYT
Another co-founder of Alibaba, Joe Tsai was appointed as the company’s chief financial officer in 2013 and currently serves as executive vice chairman. He is also the chairman of Alibaba’s logistics unit Cainiao, as well as a member of the Taobao and Tmall divisions.
Apart from his Alibaba role, chairman designate Tsai is also an owner of the Brooklyn Nets basketball team in the U.S. and is often seen as a more international-facing executive, as per CNBC.
Lazada is the Singapore-headquartered e-commerce company owned by Alibaba, which has been key to its international expansion in south-east Asia. Separately, Alibaba President Michael Evans last week said that the company would launch local versions of its Tmall e-commerce service in Europe.
Big changes in Alibaba since Jack Ma’s return
reuters
It has been a tumultuous period of around two and a half years for Jack Ma’s Alibaba, starting with the suspension of Ant Group’s blockbuster initial public offering in November 2020 after failing to satisfy regulators. The Chinese government tightened regulations on the domestic technology sector in areas from competition to data protection. Regulators hit Alibaba with a massive 18.23 billion yuan ($2.5 billion) antitrust fine in April 2021.
The company has been suffering from slowing growth because of a sluggish Chinese economy and rising competition from rivals such as JD.com and Pinduoduo. Its key cloud division, to which outgoing CEO Zhang will dedicate all his time, saw revenue decline in the March quarter.
In their new roles, Tsai and Wu will be looking to reinvigorate growth at the company amid what continues to be a difficult macroeconomic backdrop.
Also Read: Why “China’s Warren Buffett” Is Racing To Sell His Assets
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