All is not well at LeEco, reveals company chairman and co-founder Jia Yueting. In a letter addressed to employees, Yueting explains that the company’s troubles stem from the fact that it doesn’t have the cash to sustain its lofty ambitions.
LeEco is a company that manages dozens of businesses involving sports, media, cars, smartphones, TV, content and much more. Bloomberg, which got its hands on Yueting’s letter, state that Yueting pledged to slash his income to 1 Yuan (around Rs 10) and slow down the company’s growth to a more “moderate” rate.
The company was in the news only recently for its $2 billion acquisition of Vizio and its move into the US market. Yueting feels that while rapid growth might seem good, it was very bad for the company because it didn’t have enough funding or income to sustain that growth.
Bloomberg reports that following the reveal of the letter, the shares of Leshi Internet Information and Technology Corporation and Coolpad Group Ltd. (chaired by Yueting) both fell dramatically. Coolpad reportedly took the worse hit, with shares falling by 25 percent.
The company chairman now wants his employees to focus on “existing businesses” rather than building new ones. Apparently, the company’s fundraising capabilities couldn’t keep up with the needs of rapid expansion.
What this means for us, as consumers, isn’t clear yet. But as unclear as that is, it’s very apparent that LeEco is in dire straits if it’s being forced to resort to such measures.