Chinese company Alibaba Group (BABA) has appointed a new CFO and announced plans on Monday to restructure its large e-commerce business. As a result, Alibaba shares surged.
The changes came as Alibaba and other Chinese Internet companies found themselves in a difficult position due to a growing wave of government regulations amid slowing growth in the world's second-largest economy.
The company announced that in April, Chief Financial Officer Maggie Wu will leave. She will be replaced by Toby Xu, who now holds the position of deputy finance director. Alibaba called it a planned transition. Xu joined Alibaba three years ago. Wu has worked at Alibaba in various positions for 15 years and will now serve as an executive director on the company's board of directors.
The changes come as Alibaba is trading at a four-year low. Alibaba shares jumped 7.5% to $120.32.
There will always be ups and downs in the markets. But according to CEO Daniel Zhang, Alibaba has ambitious long-term goals.
However, growth prospects declined last month in response to the slowdown in China's economic growth and increased competition from competitors. To reverse the decline, the company announced that it would split its e-commerce business into two new digital versions, one focused on international markets and the other on domestic ones.
In November, Alibaba reported quarterly results, saying that sales for the current fiscal year should grow by 20-23% compared to the same period last year. Analysts had expected growth of almost 28%. Alibaba shares dropped 11% as the results fell short of expectations.
At the end of the previous year, China began a slight tightening of the regulatory framework with gradual strengthening. However, Chinese leaders still show no signs of what is happening.
