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China E-Commerce Giant Alibaba Outlines Future Strategy

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HONG KONG — Alibaba plans to spin off some of its vast e-commerce and finance empires as separate businesses to make them more flexible and maximize their value, according to top executives, as the company emerges from regulatory crackdowns that have roiled Chinese tech industries.

Alibaba CEO Daniel Zhang outlined a plan revealed earlier this week to divide Alibaba into six major groups as a prelude to some of its businesses going public. Following a series of setbacks as regulators tightened oversight of the industry, the restructuring signals a new stage in Alibaba’s development.

Alibaba will be “like a holding company that is the controlling shareholder of the business group companies,” Zhang said during a conference call.

Toby Xu, CFO of Alibaba, stated that the company would continue to assess the strategic importance of group companies after they go public and determine whether or not to retain control. He refused to indicate when they might be made public.

“We believe the market is the best litmus test,” Xu said. “As and when they are ready, each business group company can pursue independent fundraising and IPOs.”

Since the restructuring was revealed on Tuesday, the company’s stock prices in Hong Kong and New York have risen nearly 15%. The company’s Hong Kong-listed stock was up 0.9% by noon Thursday.

The plan and the recent return of Alibaba founder Jack Ma to China after months overseas mark a turnaround after several hard years. Chinese regulators singled out Alibaba for scrutiny in a crackdown on technology and internet firms, halting Alibaba’s financial affiliate Ant Group’s planned IPO in 2020.

Since November 2020, when he openly criticized China’s regulators and financial systems during a speech in Shanghai, Ma has maintained a low profile with few public appearances.

Ant had planned to raise $34.5 billion in what would have been the world’s biggest initial public offering. As Chinese authorities clamped down on the once-freewheeling technology sector, Alibaba was investigated and fined $2.8 billion for antitrust violations.

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crackdown on technology and internet firms, halting Alibaba’s financial affiliate Ant Group’s planned IPO in 2020

The company will be divided into several groups: Cloud Intelligence Group, Taobao Tmall Business Group, Local Services Group, Global Digital Business Group, Cainiao Smart Logistics, and Digital Media and Entertainment Group. Aside from Taobao Tmall, each group may pursue an initial public offering. Alibaba Group will continue to be the sole owner of Taobao Tmall.

Zhang predicted that the restructuring would be difficult, but it would also “allow all of our businesses to become more agile, improve decision making, and enable faster responses to market changes.”

The restructuring plan, among other things, may allay past antitrust concerns because, as Zhang explained, each Alibaba business unit would be empowered to make its own choices and collect money independently.

“The looser connections between the business units are consistent with the regulatory stance of encouraging competition,” according to a Moody’s Investor Service analyst note.

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Alibaba’s restructuring — the first of its kind in the Chinese technology industry

Alibaba’s restructuring — the first of its kind in the Chinese technology industry — could also serve as a model for other businesses, such as online games company Tencent. Tencent’s stock rose following Alibaba’s statement on Monday.

According to CreditSights, “we believe that Alibaba’s new organizational structure could be used as a template by Chinese regulators for other Chinese Big Tech firms.”

According to Francis Lun, CEO of Geo Securities in Hong Kong, the company’s move will likely enable the group to raise more capital in the short run. However, the business may need help to remain competitive in mergers and acquisitions.

“You’d be a lightweight competing against heavyweights like Apple, Amazon, and Alphabet if you split into six business units,” Lun said.

He stated that only that the company’s e-commerce and cloud divisions were profitable and that the other units may fail in the long run.

SOURCE – (AP)

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Toyota Recalls 280,000 Vehicles Because They May ‘Creep Forward’ In Neutral

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Toyota recalled approximately 280,000 pickups and SUVs in the United States because the engine may not fully disengage while in neutral.

“Certain parts of the gearbox may not immediately disengage when the vehicle is shifted to the neutral position,” the Japanese automaker stated on Wednesday. It said this allows some engine power to continue going through to the wheels.

As a result, the vehicle may “inadvertently creep forward at a low speed when it is on a flat surface and no brakes are applied, leading to an increased risk of a crash,” according to the manufacturer.

toyota

Toyota Recalls 280,000 Vehicles Because They May ‘Creep Forward’ In Neutral

Certain Toyota Tundra, Sequoia, and Lexus LX 600 cars made between 2022 and 2024 are being recalled. Lexus is Toyota’s luxury brand.

Toyota said it will notify owners of recalled vehicles in late April and update the gearbox software.

The business stated that the recall is one of three in the United States on Wednesday.

Toyota announced the recall of an additional 19,000 vehicles due to a software issue: “the rearview image may not display within the period of time required by certain US safety regulations after the driver shifts the vehicle into reverse, increasing the risk of a crash while backing the vehicle.”

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Toyota Recalls 280,000 Vehicles Because They May ‘Creep Forward’ In Neutral

It noted that the safety recall applies to select Mirai and Lexus LS, LC, and ES models manufactured in North America between 2023 and 2024.

Additionally, about 4,000 Toyota Camry and Camry Hybrid vehicles are being recalled due to safety concerns with the head restraints on rear fold-down seats, which “increase the risk of injury during certain collisions.”

Toyota is the world’s largest carmaker by sales, yet it risks becoming embroiled in safety controversies.

In December, it recalled approximately 1 million cars and SUVs in the United States owing to a potential fault that might cause the passenger airbag to fail to deploy in a crash.

toyota

Toyota Recalls 280,000 Vehicles Because They May ‘Creep Forward’ In Neutral

The recall affected 15 Lexus cars from 2020 to 2021, including the Camry, Rav4, Sienna, RX350, and ES350.

After admitting to forging safety test results for more than 30 years, Daihatsu, a small Japanese automaker under Toyota ownership, stopped domestic production late last year.

SOURCE – (CNN)

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Walmart To Acquire Smart TV Maker Vizio For $2.3 Billion In Bid To Boost Its Advertising Business

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Walmart is paying $2.3 billion for smart TV maker Vizio to boost its quickly growing advertising business and compete with Amazon.

If the purchase is completed, Walmart will gain access to Vizio’s SmartCast operating system, allowing the retail juggernaut to offer its suppliers the opportunity to display adverts on streaming devices.

Walmart Connect, which provides marketers with access to Walmart’s large consumer base, has helped the company grow its media and advertising business. Walmart reported on Tuesday that its global advertising business increased by nearly 28% to $3.4 billion last year.

The developments follow Amazon’s announcement last month that it will begin charging Prime members $2.99 per month to keep their films and TV series ad-free, in addition to the $14.99 per month or $139 per year Prime price.

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What does Walmart stand to gain from a television manufacturer?

Vizio’s SmartCast technology has 18 million active accounts and has increased 400% since 2018. The firms claim that Vizio’s platform has over 500 direct advertisers and that ads now account for most of the company’s gross profit.

In recent years, makers of streaming gear, such as Roku and Vizio, have moved their focus to advertising revenue. Vizio established its Vizio Ads business unit in 2019, claiming to be “one of the few connected TV companies with the device penetration, consumer opt-in, and infrastructure to deliver meaningful scale.”

Walmart saw Vizio’s growing consumer base and grabbed the opportunity to develop its Walmart Connect business.

“We believe the combination of these two businesses would be impactful as we redefine the intersection of retail and entertainment,” said Seth Dallaire, executive vice president and chief revenue officer at Walmart U.S.

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Who else is ramping up screen advertising?

Other large streamers, such as Netflix and Disney, have embraced the dual model, allowing them to generate revenue from commercials while simultaneously allowing customers to opt-out for a higher charge.

However, in the ever-changing streaming industry, whether consumers are prepared to pay more to see fewer commercials when they already pay subscription fees, frequently for numerous providers, remains to be seen. Many consumers “cut the cord” and ditched cable TV because they were frustrated with their ever-increasing fees.

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How did the companies’ shares fare?

Vizio stock rose about 15% in the afternoon, reaching $10.96 per share.

Walmart’s stock jumped 3.1% to $175.66 per share after exceeding Wall Street’s expectations with its sales and profit on Tuesday.

Roku, one of Vizio’s primary competitors, saw its stock drop 6.4% by midday.

SOURCE – (AP)

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Sacked Twitter Staff In Ghana Finally Get Pay-Off

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X, then known as Twitter, has finally paid out the employees it fired from its African offices more than a year ago, according to the agency that represents them.

Most had just been with the social media network in Ghana’s capital, Accra, for a few months before they were let go in November 2022.

They had threatened to sue X for failing to pay the redundancy money they said they were promised.

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Sacked Twitter Staff In Ghana Finally Get Pay-Off

The corporation has yet to respond.

X previously stated that it had paid ex-employees in full.

Elon Musk, who took over the corporation in 2022, launched a large global workforce layoff, dismissing almost 6,000 individuals. He said he was losing more than $4 million (£3.5 million) daily.

The African contingent, which numbered fewer than 20, had only recently relocated to X’s new office in

Accra after eight months of working from home during the COVID-19 outbreak.

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Sacked Twitter Staff In Ghana Finally Get Pay-Off

Agency Seven, the organisation providing legal representation to the workforce, stated that it had successfully obtained a redundancy settlement and repatriation fees for foreign employees but did not indicate the payout size.

“They are very pleased to finally be able to get their due, put this behind them, and look forward to the future,” Agency Seven Seven spokesperson Carla Olympio told the BBC.

Last year, terminated employees told the BBC that their treatment at X had impacted their mental health and money.

“It’s difficult when it’s the world’s richest man owing you money and closure,” one of them stated.

They claimed they were initially assured that they would be paid to work for one more month while their contracts were being terminated. However, they were instantly shut out of their emails, and no more wage payments were issued.

Since then, the crew has reported a difficult battle for compensation.

Some had migrated from adjacent nations, such as Nigeria. Their contract was terminated, leaving them and their families stuck in Ghana.

In a rare interview with the BBC last April, Mr Musk revealed that the social media powerhouse had 1,500 staff, down from just under 8,000 when he bought the company.

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Sacked Twitter Staff In Ghana Finally Get Pay-Off

When the news of Mr Musk’s extreme workforce reduction broke, he tweeted that laid-off employees received three months’ severance compensation.

However, staff members in the Africa office claim they still need this.

According to Agency Seven Seven, X only started negotiating with the terminated African staff after the BBC publicised the news.

Last year, ex-employees filed a complaint in a California court accusing X of failing to pay at least $500 million in promised severance benefits.

SOURCE – (BBC)

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