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Calling Apple a “legacy company” manufacturer of smartphones LeEco was on the verge of bankruptcy

From year to year we hear about the appearance of some new companies, declare their readiness to dethrone Apple and other market leaders. This year was especially zealous in the matter promises to deliver a lot of joyful emotions of the victory over the giants recognized his loyal audience, the Chinese media giant LeEco. In June the head of LeEco Jia Watin said that Apple is a great company, but she is stuck in the past. The plans of the Chinese company appeared to beat on the market the iPhone maker. But it was exactly the opposite, and ambitious Chinese conglomerate was on the verge of bankruptcy.

The money flowed in the grandiose and large-scale events, investment in the development of various projects and selling smartphones even below its cost has led to the devastation of the budget LeEco. Realizing the seriousness of the problem, the company decided to save. Stock markets reacted immediately and the shares of the company fell down. This week they reached the lowest level in the history of the company – shares traded at a price 35,01 yuan. Further cost reduction, according to experts, can lead to irreversible consequences, where the possibility of bankruptcy becomes more real.

As usually happens in such situations, the company intends to reduce its losses by firing its employees. Reduction in LeEco will be massive and will affect every tenth employee: if this staff is about 8,000 people, after the wave of layoffs he should be reduced to 7,200.

Curiously, the dismissal relate primarily to the divisions engaged in development and sales of smartphones. However, a very unpleasant procedure will affect other departments, including those involved in the development of the automotive and sports TV channels.

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Last year Jia Watin said that Apple is a great company, but it is “stuck in the past”. In LeEco called Apple’s “obsolete”. Yuetin said earlier about the sharp weakening of the innovative momentum of the Apple: “for Example, recently Apple released the iPhone SE. From the point of view of the representative of the industry it is a product with a very low technological level… We think this is something they should not have to do.”

Last year LeEco compares Apple with the Fuhrer of Nazi Germany. In the microblog LeEco got this poster, which depicts a smart phone and two arrows on the left and the smiling children, to the right, Adolf Hitler with his arm outstretched. On the sleeve of the Fuhrer swastika instead of the Apple logo. The message of the Chinese are quite clear: buyers have a choice, either to use the open Android platform, or to obey strict rules for the iOS ecosystem.

In November, the head and co-founder LeEco Jia Yatin said in a letter to employees about the problems the company has promised to invest $10 million of its own funds and to reduce his salary to 1 yuan. One of the priority areas were named as expansion to foreign markets like the US (by the way, before the emergence in the United States, the company also released in September on the Russian market) and the development of self-driving cars (last year the number of employees of this division grew from 30 to 600 people).

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