Ambitious Chinese tech firm LeEco is downsizing its presence in India less than six months after founder Jia Yueting warned that the growth of some parts of its business had become unsustainable.
The company confirmed to TechCrunch that it has reduced its headcount in the country from over to 350 staff to a total of 80 today. A spokesperson said the size of the team is now “in line with industry benchmarks,” putting its India-based staffing numbers on a comparable level with those of rival Chinese phone makers Xiaomi and OnePlus.
The layoffs were initially reported by India’s Economic Times, which claimed that 85 percent of staff had exited as a precursor to LeEco’s total withdrawal from the domestic market.
LeEco denied it is leaving the country.
“India is one the most strategic markets for LeEco and hence there is no exit plan. In the past one year, LeEco India has gained market recognition and the initial stage of market seeding has been successful,” LeEco said in a statement.
“The company’s recent moves were well thought out and planned as part of a longer-term strategy for the Indian market, and not triggered by the purported slump in sales due to demonetization,” the person said.
Chinese smartphone makers have flooded India in a bid to grab a piece of the country’s growing digital revolution. While smartphone sales are slowing globally, India is the largest country to buck that trend, and it hasn’t gone unnoticed. According to a report from IDC, the final quarter of 2016 marked the first time that an Indian company had failed to feature among the top five smartphone sellers — Samsung led the pack, following by Chinese rivals Xiaomi, Oppo, Lenovo and Vivo.
LeEco didn’t feature in that ranking and it hasn’t provided details of its sales in India. Today, the company said it has “gained significant market recognition” for its smart TVs and smartphones. It didn’t elaborate on that point, other than to note that it has new products in both categories launching in India soon.