Daniel Zhang Yong, the 51-year-old Chinese business executive, has announced his resignation as Alibaba Group Holding chairman and chief executive to focus on Alibaba Cloud, the digital technology and intelligence backbone of the group.
Zhang will be succeeded as chairman by Joseph C. Tsai, who is currently executive vice-chairman, and Eddie Wu Yongming, chairman of Taobao & Tmall Group, will become CEO. Zhang will continue on at the company as chairman and CEO of Alibaba Cloud Intelligence Group, the company said in a statement on Tuesday. The change will take effect September 10.
Zhang took over as CEO in 2015 and as chairman in 2019, after Jack Ma relinquished his corporate roles at the e-commerce giant he started in 1997. Alibaba owns the South China Morning Post, and Tsai is chairman of the newspaper.
Do you have questions about the biggest topics and trends from around the world? Get the answers with SCMP Knowledge, our new platform of curated content with explainers, FAQs, analyses and infographics brought to you by our award-winning team.
“This is the right time for me to make a transition, given the importance of Alibaba Cloud Intelligence Group as it progresses towards a full spin-off,” Zhang said in a company statement.
Alibaba CEO Daniel Zhang Yong seen during AliDay in May. Photo: Weibo alt=Alibaba CEO Daniel Zhang Yong seen during AliDay in May. Photo: Weibo>
In an internal memo seen by the Post, Zhang said that it would be “inappropriate” for him to continue serving as chairman and CEO of both Alibaba and Alibaba Cloud as the cloud unit prepares for an initial public offering. “From a corporate governance perspective, we also need clear separation between the board and management team as Cloud Intelligence Group proceeds down the path to becoming an independent public company,” he wrote in the letter.
Zhang “has made exceptional contributions to the development of Alibaba Group since joining the company in 2007”, Tsai said in the company statement. “He demonstrated extraordinary leadership in navigating unprecedented uncertainties affecting our business over the past few years. We believe there is no better leader than Daniel to steer Alibaba Cloud Intelligence Group into the next chapter of its journey and future growth.”
Alibaba shares were down 1.6 per cent in Hong Kong to HK$88.25 (US$11.29) by mid-day Tuesday.
Wu, another Alibaba co-founder, was the chief technology officer for several of the e-commerce giant’s key businesses, including taking the role in 2004 at Alipay, the popular mobile payment app now operated by the fintech spin-off Ant Group. He also spearheaded the launch of the Taobao mobile app.
Wu became chairman of Taobao & Tmall Group in May, after the business became an independent business unit under the restructuring, a role he will keep after taking over as Alibaba CEO, the company said.
The new leadership comes after Alibaba’s largest ever restructuring in March, when it announced plans to split into six independently run entities, each free to pursue its own fundraising through initial public offerings. The corporate shake-up is meant to inject new competitive pep into the company.
During an informal meeting in May, Ma advised the company to refocus its efforts on Taobao, the online marketplace made up of third-party sellers, in order to weather fierce competition and economic headwinds, Chinese media reported.
Zhang personally took over the cloud unit last December after a major service breakdown in Hong Kong. Under the corporate restructuring, Alibaba will spin off the cloud unit at some point in the next year through a “stock dividend distribution to shareholders”, turning its cloud business into an “independent, publicly-listed company”.
Cloud computing has been a particular bright spot for Big Tech firms in recent years, and Zhang has repeatedly said in the past that Alibaba Cloud has high potential.
In a conference call in February, Zhang emphasised the company’s commitment to cloud computing, noting the impact of new technologies like virtual reality and generative artificial intelligence. “We expect to see exponential growth in the demand for compute power, so for us as a cloud vendor, I think the story is just getting started,” he said at the time.
Employees often refer to Zhang as Xiaoyaozi, meaning the “free and unfettered one”, in reference to a character from a wuxia novel by Chinese martial arts writer Louis Cha. Zhang previously served as chief financial officer at Taobao Marketplace, president at Tmall and as Alibaba’s chief operating officer, before succeeding Jonathan Lu Zhaoxi as CEO.
Zhang, a Shanghai native, first joined Alibaba in 2007 and played a key role in driving Taobao to profitability. He is best known for starting Singles’ Day, the country’s largest shopping festival. Originally taking place on November 11, and sometimes referred to as “Double 11”, the event now typically runs from late October to mid-November.
This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore the SCMP app or visit the SCMP’s Facebook and Twitter pages. Copyright © 2023 South China Morning Post Publishers Ltd. All rights reserved.
Copyright (c) 2023. South China Morning Post Publishers Ltd. All rights reserved.
Source: https://finance.yahoo.com/news/alibaba-co-founder-joe-tsai-093000390.html