JD.com founder Liu Qiangdong, who was cleared of sexual assault charges in 2018, has handed over the chief executive officer role to company veteran Xu Lei. At the same time, Xu will also join JD.com’s board as an executive director, the company said on Thursday.
Liu will stay on as chair and is JD’s controlling shareholder, holding a separate class of shares that gives him around 77 percent of the total voting right of the company.
“I’ll devote more of my time to JD’s long-term strategies and future drivers as we continue to work on the most challenging, yet valuable things,” Liu said.
He will also “continue to focus on guiding the company’s long-term strategies, mentoring younger management, and contributing to the revitalization of rural areas,” JD.com noted.
It’s believed that the succession plan has been in place for months. Last September, Xu was promoted to president of JD.com to run “day-to-day operations.”
Before that, the 47-year-old Xu held various roles during his decade-plus time at the company, including chief executive officer of JD.com’s retail business, chief marketing officer at JD.com, head of JD Wireless and head of the marketing department.
Since China’s crackdown on the tech sector, starting with Alibaba’s Jack Ma, who mysteriously went missing for more than three months after heavily criticizing China’s financial regulatory system in front of a room full of high-ranking officials back in 2020, a slew of tech billionaires have stepped back from daily operations, including Colin Huang from Pinduoduo, Su Hua of Kuaishou, and Zhang Yiming, founder of Douyin and TikTok owner ByteDance.
While JD.com has been attracting more luxury players, including Dior, Loewe, Givenchy, Mytheresa, Ami Paris and Neil Barrett to sell via the platform since its major rival Alibaba was fined $2.78 billion for monopolistic behaviors in China last April, the company has also been impacted by the industry-wide scrutiny.
In 2021, the company reported a year-over-year 66.7 percent decline in operating profit to 4.1 billion renminbi, or $600 million, although net revenues grew 27.6 percent to 951.6 billion renminbi, or $150 billion.
Rounds of layoffs within the company have also made headlines in local media.
In comparison, Alibaba Group logged its slowest quarterly revenue growth since listing in 2014 with the quarter ending Dec. 31, 2021. The company’s revenue in the period rose about 10 percent to 242.6 billion renminbi, or $38.37 billion, but net profit plunged 75 percent to 19.43 billion renminbi, or $3 billion, in the period.