LeEco has no choice but to downsize its ambitious operations in ‘various geographies’, including India
Before judging Xiaomi too harshly for continuing to show hesitation regarding a proper US expansion, or Huawei for still struggling to gain traction in the uber-crowded and hyper-competitive smartphone market, consider LeEco for a second.
This Chinese tech and entertainment giant rushed its rise to global fame, spending way too much money too early on ramping up production, distribution and marketing efforts across “various geographies”, most notably stateside and in India.
Consequently, the company now faces big cash flow and stock trading problems, needing to lay off an unspecified number of employees around the world as part of a major business strategy revision. This comes at a time of “overall volatility and uncertainty forecast for the global economy”, with “business imperatives” entirely prompting certain “steps to ensure the sustainability and profitability” of LeEco’s operations.
In a nutshell, expenses have to be reduced ASAP for affordable, largely promising but far from flawless LeEco phones and TVs to stay with important American and Indian retailers, as well as continue selling through the OEM’s regional online LeMall branches.
In addition to honorable discharges of employees that will be offered outplacement services and severance packages, LeEco may also need to scale down device manufacturing and advertising. But fret not, as a “robust product pipeline” is still “in the offing.”