Alibaba Layoffs: Chinese Tech Giant's Cloud Division Begins Fresh Round of Job Cuts, To Reduce Its Workforce by 7%, Say Reports
As per new reports, Alibaba is about to fire a significant chunk of its workforce. The new layoffs will include 7% of employees, primarily in its cloud division.
Mumbai, May 24: Alibaba is joining the current trend of tech layoffs. New reports claim that the Chinese tech giant is planning to fire almost 7 per cent of its total workforce. However, these layoffs will primarily affect the company's cloud division. Alibaba had more than 250,000 employees under its roster till the last quarter.
Alibaba layoffs are expected to happen as early as this week. Recent reports suggest that the company has already started informing the employees about the mass layoffs. Certain employees are getting an option to transfer to other divisions. As of now, the exact number of fired employees is not known. SoundCloud Layoffs: Streaming Platform Announces Job Cuts, To Fire 8% of Its Workforce To Become Profitable
The new move is part of the company's new restructuring strategy to position divisions for rapid growth. It hopes to create an independent spinoff of divisions, eventually leading to an initial public offering (IPO).
The company is gearing up to restructure into six units - Cloud Intelligence Group, Taobao Tmall Commerce Group, Local Service Group, Cainiao Smart Logistics, Global Digital Commerce Group and Digital Media and Entertainment Group. Each of these will be run by its own CEO and board of directors.
To begin with, Alibaba reportedly plans to streamline its cloud service business. In the last quarter, the company's cloud division reported a revenue of 18.6 billion yuan (down 2% year-on-year).
Earlier this month, Alibaba shared fund-raising plans for four business units, including its logistics unit Cainiao. Cainiao is China's largest cloud service. It is expected to be listed next year. Reliance JioMart Begins Layoffs, Sacks 1,000 Employees; 9,000 More Job Cuts Likely in Coming Months: Reports.
The Chinese tech giant is facing the brunt of a two-year regulatory crackdown on China's tech sector by the Chinese Communist Party. Alibaba Cloud reported a major software error to authorities in 2021. It was also involved in one of China’s most significant cybersecurity data leaks in 2022. Investors have embraced the new announcement. Alibaba's Hong Kong-listed shares surged as much as 16% on Wednesday and closed at 94.55 Hong Kong dollars (12.2%).
(The above story first appeared on LatestLY on May 24, 2023 08:57 AM IST. For more news and updates on politics, world, sports, entertainment and lifestyle, log on to our website latestly.com).