With the aim to cut down expenses amid sluggish sales and slowing economy in the country, Chinese tech conglomerate Alibaba has bid goodbye to nearly 10,000 employees on Saturday.
Alibaba Firing 10000 Employees
It appears that more than 9,241 employees left Hangzhou-based Alibaba during the June quarter after the company trimmed its overall headcount to 245,700 according to South China Morning Post.
Further report said, “That put the total decrease in employee numbers for Alibaba, owner of the South China Morning Post, to 13,616 over the six months to June, marking the firm’s first drop in payroll size since March 2016,”.
Notably, the Chinese multinational technology company reported a 50 percent drop in net income to 22.74 billion yuan ($3.4 billion) for the June quarter.
This is almost half from 45.14 billion yuan in the same period last year.
Regulatory Pressure On Alibaba
The report noted, “The reduced payroll reflects Alibaba’s renewed efforts to cut expenses and drive up efficiency, as it faces continued regulatory pressure, sluggish consumption and a slowing economy in China, the world’s biggest e-commerce market,”.R
This year, the technology giant is planning to add nearly 6,000 fresh university graduates to its headcount, said Alibaba Chairman and CEO Daniel Zhang Yong.
Prior to this, reports surfaced that billionaire Jack Ma is planning to give up his control of Ant Group last month amid the pressure caused by the government regulators.
This latest move is aimed at part of the fintech giant’s effort to move away from affiliate Alibaba Group Holding that is under immense scrutiny from the government, as per a report in Wall Street Journal.
In order to end their dominance in the internet sector, Chinese regulatory authorities have been cracking down harder on domestic tech giants like Alibaba and Ant Group since last year.
It seems that Ma could relinquish his control by transferring some of his voting power to other Ant officials, including Chief Executive Eric Jing, the report suggests.
More than a decade ago Ma has carved its precursor assets out of Alibaba and has controlled Ant.
Also, Alibaba went through a major reshuffle when Ma passed the baton as CEO to Daniel Zhang in 2015 and further appointed him as Chairman in 2019.