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The Controversial LeEco
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The Controversial LeEco

China's Overexpanding Internet Giant’s Financial Squeeze

Li Yating, Ma Jiying and Li Xiaoxiong
China Entrepreneur , 2017
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Editorial Rating

8

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Recommendation

Chinese online retail giant LeEco has ventured into a slew of businesses, including smartphones, smart TVs, video streaming and electric cars. However, investors have been critical of the company’s strategy – especially after founder and CEO Jia Yueting admitted in November 2016 that overexpansion had led to a financial squeeze. Now that an investor’s cash injection has revived the company, Jia insists on sticking to his strategy and remains optimistic about the future. Alas, analysts and investors aren’t so sure. getAbstract recommends this profile of the struggling giant to investors and financial analysts.

Take-Aways

  • An unnamed strategic investor is injecting cash into China’s struggling online retail giant LeEco. The investor and LeEco signed a strategic cooperation framework agreement to the tune of 15 billion yuan [$2.4 billion].
  • Market analysts and investors call into question LeEco CEO Jia Yueting’s assurances that the company’s “most difficult time has passed.”
  • LeEco needs to pay its debts, stabilize its stock price and put its finances in order.

About the Authors

Li Yating, Ma Jiying and Li Xiaoxiong write for the Chinese business magazine China Entrepreneur Magazine, which profiles business leaders, investigates companies, and also reports on business trends and management insights of Chinese entrepreneurs.

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