Briefing: Huawei to lay off employees and cut costs as economy slows

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任正非连续两次讲话 要求华为准备过苦日子 – Caixin

What happened: Chinese telecommunications giant Huawei plans to drive a new round of personnel reductions as it faces challenges amid China’s struggling economy. The solution is to “cut a portion of jobs with less value and simplify the organization to ensure those who work hard can gain more benefits from their jobs,” Ren Zhengfei, founder and chief executive said in an internal memo on Friday. He also mentioned the company will avoid overly laying off staff, while warning employees to prepare for “times of hardship” as the overall situation might be not as good as imagined.

Why its important: A slew of China’s big technology companies has reportedly laid off employees over the past months, namely, Baidu-backed iQiyi, lifestyle service Meituan Dianping, and knowledge sharing platform Zhihu. Earlier this month, Chinese e-commerce giant Alibaba was rumored to cut travel spending and postpone hiring. US tech giant Apple cut its revenue forecast for the first time in nearly two decades due to the  weaker demand in China at the beginning of 2019. Previously, US coffee giant Starbucks saw its store sales growth begin to slow in the third quarter of 2018.