Chinese e-commerce giant Alibaba plans to spin off its cloud division as a separate publicly traded company after reporting quarterly revenue that missed expectations.
Alibaba's CEO, Daniel Zhang, announced that its Cloud Intelligence Group will be fully spun off through a stock dividend distribution to shareholders.
- The cloud intelligence group, which combines AI and cloud services, aims to complete the public listing within the next year.
- The announcement comes after Alibaba said it would split its business into six independent companies, most of which will be able to seek outside funding and pursue their own IPO.
- In line with the restructuring plans, Alibaba intends to seek outside funding and take most of its units public, except for its China-facing e-commerce division.
- Zhang said it's planning potential IPOs for Alibaba Global Digital Commerce Business Group, Freshippo (its grocery arm), and Cainiao (its logistics unit) within the next 18 months.
- Alibaba has said it is the "most significant" restructuring of the technology organization since it was founded in 1999.
- Competition from rivals PDD Holdings and Douyin has negatively impacted Alibaba's user growth in China's mature e-commerce sector.