Chinese handset maker LeEco today refuted reports of winding up its India operations but admitted that it has undertaken an “optimisation exercise” in the world’s second largest smartphone market.
“India is one of the most strategic markets for LeEco and hence no exit plan… (the company) has recalibrated and reimagined its business in India since last year and taken a number of steps to ensure that the scale of operations is in sync with resources,” LeEco India said in a statement.
Reports said the company has laid off 85 per cent of its staff in India and may shut its operations here.
Top executives Atul Jain (COO smart electronics business) and Debashish Ghosh (COO Internet applications, services and content) have also reportedly quit.
“As LeEco India transits to a more strategic phase of operations in India, it is appropriate to take steps to ensure the sustainability and profitability of the business. It is with this sole intent that an optimisation exercise in India was undertaken,” the statement said.
LeEco further said in India, it continues to operate with a “very experienced team” comprising senior team leaders and business heads. “The resource head count in India is well aligned to the scale of operations envisioned and in line with industry benchmarks,” it added.
The company did not respond to queries on number of people laid off, severance packages offered and executive replacement. LeEco also asserted that it has a healthy product pipeline planned for India this year. “The company is gearing up for the launch of its next generation TV, scheduled the coming week. Premium models of smartphones too are to follow… All this certainly does not signal a company in wind-up mode,” it said.
It added that to support the upcoming products, LeEco will invest in marketing initiatives in India which will be in tandem with the sales objectives. In November last year, LeEco CEO Jia Yueting had written an email to employees saying the firm had burnt cash too quickly and that it would cut costs and realise efficiency.
“The Indian operations will undoubtedly adopt a laser- sharp focus on overall organisational efficiency, capacity- building and talent nurturing while remaining unwaveringly committed to maintaining a sustainable and profitable business model,” LeEco said.