LeEco plans to cut 10 percent of workforce
Chinese internet company LeEco is cutting jobs to pull in its horns and relieve its cash flow crunch.
Cash-strapped LeEco, which has a total payroll of 8,000, is planning to cut its workforce by 10 percent, according to the Guangzhoubased TimeWeekly.
LeEco didn’t deny the report and said that it needed to optimize its operations and reorganize the company.
An employee at the company’s sports subsidiary Le Sports, who declined to give his name, told China Daily there are more than 1,000 employees in Le Sports, and 10 percent of the jobs will be cut.
Shen Meng, director of Chanson & Co, a boutique investment bank in China, said: “This layoff and shrinkage in operations by LeEco are a remedial measure to its previous overexpansion and cash burning.”
Shen added what LeEco needs to consider is to cut off its non-core businesses and focus on key areas.
“Electric vehicles, real estate and e-commerce are far from LeEco’s major businesses, which include consumer electronics and entertainment technology,” said Shen.
LeEco founder and CEO Jia Yueting said it was starting to see signs of “big company disease”, such as low individual performance and organizational redundancies.
LeEco announced a strategic partnership with US telecoms giant AT&T Inc on Tuesday on content and terminal cooperation.
LeEco said AT&T’s DIRECTV would become its content partner, providing content from more than 100 channels.
AT&T said it will work with
LeEco tooffer integrateduser experience modes, which will eventually be available on LeEco’s terminals sold in the US.
“We continue to bring to life our vision of a connected ecosystemthat puts content at the center of the experience. We are making our premium products and the best content even more
accessible,” said Danny Bowman, chief revenue officer for LeEco North America.
Brad Bentley, executive vicepresident at AT&T Entertainment, said: “We’re excited to offer LeEco customers a new way to enjoy the best in video content.”