Alibaba Photo:VCG

China's tech giant Alibaba will reorganize its domestic and international e-commerce businesses and name a new CFO, an internal letter released by the company’s CEO Zhang Yong said on Monday, amid a slowdown in its earnings and a decline in share price.

According to the internal letter, the company will set up two new units – “China Digital Business” and “Overseas Digital Business” – aimed at self-reform and meeting challenges. Jiang Fan, former president of Alibaba's e-commerce platforms Taobao and Tmall, will be in charge of international business, including AliExpress and Southeast Asian e-commerce business Lazada. Dai Shan, former head of the firm’s business-to-business (B2B) unit, will take over domestic business, including Taobao and Tmall.

Both appointments will take effect on January 1, 2022.

In the past, Alibaba has announced organizational restructuring and personnel changes after the Double 11 festival. However, during the third quarter this year, the company experienced the lowest revenue growth rate since its IPO in 2014. Managers attributed the slowdown to an unfavorable macro business environment and increased market competition.

After Chinese ride-hailing giant Didi began the process of delisting from the New York Stock Exchange (NYSE), Alibaba’s shares in Hong Kong hit a new low since its secondary listing in November 2019.

Zhang said in the internal letter that faced with increased competition, Alibaba should make more efficient decisions with more uniform actions, and the positioning and division of labor of various departments should become clearer.

According to Zhang, the diversified governance system is aimed at creating real long-term value with a clearer strategic blueprint and a more agile organization. Domestic demand, globalization and cloud computing are Alibaba's three main strategies, and this targeted restructuring releases a signal for the company to further focus on domestic demand and overseas business.

With the growing development of the domestic market, the firm wants its overseas business to be the main source of incremental users in the future. Zhang said Alibaba’s international market has grown rapidly in the past few years, with 285 million active overseas consumers, but there is still a long way to go before it becomes a truly global company.