Home Business Jack Ma urges Alibaba to ‘correct course’ in rare internal memo

Jack Ma urges Alibaba to ‘correct course’ in rare internal memo

Jack Ma urges Alibaba to ‘correct course’ in rare internal memo


In an unexpected within memo, a billionaire Jack Ma demanded major adjustments from Alibaba Group Holdings Company, a business his established many years prior.

Jack Ma, the man who founded as well as chairman for the massive Chinese the internet company the Alibaba company (REUTERS)

After largely removing himself from day-to-day operations in 2020, Ma shocked staff members on Wednesday by answering a staff member’s share in the company’s internal forum. The businessman commended rival PDD Holdings Inc.’s recent moves to seize the market from China’s front-runner in e-commerce in his brief message. Confident that Alibaba would “correct its course,” Ma said as much in a post that was verified by individuals with knowledge of the forum.

Alibaba, which was once the top candidate in China for becoming an trillion-dollar business, is currently trading at about half of what it was at its peak in 2020. The business is dealing with both internal and external challenges, such as an unexpectedly weaker economy. resurgence threatens its previously monopolistic online retail business with new competitors like PDD as well as ByteDance Ltd.

The tycoon penned, “Every successful enterprise emerges during challenging times.” “As the era of artificial intelligence (AI) continues to shape online shopping, it presents both opportunities and hurdles for everyone involved.”

The public disclosure of a plan to divide the company into six smaller entities was the first of many upheavals the company experienced this year. After Daniel Zhang, the company’s then-chief executive officer, resigned, Ma’s longtime friends Joseph Tsai and Eddie Wu took over as group leaders. A few months later, the duo revealed they were delaying the anticipated turnaround and listed their $11 billion cloud division, an unexpected move that raised questions about the company’s future course. Calls and messages requesting comment from an Alibaba representative were not answered.

He Silvers, the Chief Investment Officer at Kaiyuan Capital, suggests that Alibaba is currently facing heightened turbulence subsequent to Ma’s online response. Silvers observes that Ma’s strategy of reducing his holdings has proved ineffective, and despite his recent ostensibly positive message, it has been widely construed as causing damage instead.

Ma’s uncommon memo indicates that the co-founder felt compelled to address the military, though it’s unclear in which Ma saw the urgent need for change. Because the stock price of Alibaba was not where he was comfortable with it, Ma this month shelved his plan to cut his stake in the company.

After years of avoiding the spotlight due to Beijing’s assault on his businesses, the vocal billionaire is now more visible in the public eye, as evidenced by his remarks to the company’s employees. He founded Hangzhou Ma Kitchen Food, a new business that will process and market agricultural products.

Following Ma’s upbeat remarks, Alibaba shares in Hong Kong reduced their losses. They were released within hours of PDD releasing yet another outstanding set of findings. The billionaire Colin Huang’s company jumped eighteen percent after revealing double-digit revenue growth. This was due to the success of the Temu shopping program in the United States and domestic entry.

PDD’s growth exceeded that of its Chinese competitors, such as Alibaba, demonstrating how it is leveraging advertising to draw in customers searching for deals during a period of uncertain economic conditions. According to Goldman Sachs’ estimate, PDD is expected to report a 20% growth in deals during the just-ended Valentine’s Day purchasing spree, compared to a single-digit increase for its competitors.

It is now not immediately conceivable that PDD’s $176 billion market value is within the reach of Alibaba’s $190 billion. Temu, which has outperformed Shein in sales for over a year and is currently regarded as one of the biggest disruptive forces in global e-commerce, is partially to blame for that incredible rise. The website, which uses Pinduoduo’s internal PDD program in addition to the price-cutting tactics employed by arch-rival Shein, has grown its operations into several nations.

On the other hand, Alibaba initially ventured into foreign markets through AliExpress, the search engine Alibaba.com, and subsequently through international subsidiaries like Trendyol and Lazada. Nevertheless, despite years of efforts, the Chinese industry continues to contribute the most to revenue.

Ma conveyed her best wishes to It for their decision-making, implementation, and hard work throughout the past years. Every business experiences its peak, yet those esteemed are the entities ready to invest extensively and embrace compromises, just as individuals who are open to making adjustments for a better future.