Alibaba, the Chinese ecommerce giant, is undergoing a leadership change as it splits into six separate entities to drive reinvention. Daniel Zhang, Alibaba’s longtime leader, will be replaced as CEO and chair by Eddie Yongming Wu, the chair of Alibaba’s flagship ecommerce sites Taobao and Tmall. Joseph Tsai, Alibaba co-founder and vice-chair, will assume the role of board chair. This shift comes after Alibaba announced plans in March to focus on its ecommerce roots by breaking up its tech empire. The company will pursue separate listings for its logistics and grocery businesses, as well as spin off its cloud division.
Zhang will continue to oversee the cloud unit, which he took charge of in December. Despite facing growth challenges, Zhang expressed confidence in its progress. The news of the leadership change was met with cautious optimism from investors, with Alibaba’s stock seeing a minimal decline compared to the broader Hang Seng Tech index.
Wu, a key member of Alibaba’s founding team, has a comprehensive understanding of the organization. His experience includes driving the successful launch of the Taobao shopping app, which became integral to Chinese consumers’ daily shopping routines. He will retain his role as chair of the wholly owned Tmall and Taobao subsidiary.
Alibaba’s leadership transition coincides with a complex period for the company, marked by challenges such as the cancellation of sister company Ant Group’s IPO and a record antitrust fine. Zhang plans to strengthen the cloud business by making cloud computing and artificial intelligence more accessible to businesses of all sizes and industries.
Despite Alibaba’s significant sales and profit growth during Zhang’s tenure, concerns have arisen over its position in the domestic ecommerce market, as well as China’s economic recovery and geopolitical tensions with the US. Alibaba aims to refocus on serving small and medium-sized enterprises, which are seen as crucial for economic growth and job creation.
As Alibaba embarks on this new chapter, the company remains committed to its vision of empowering businesses through technology. The leadership change represents a strategic move towards achieving this goal.
Additional reporting by Hudson Lockett in Hong Kong.
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