By Jiahui Huang


An Alibaba Group veteran is stepping down as head of the Chinese technology giant's food delivery and maps division in an internal reshuffle that will divide the unprofitable business into two units.

Yu Yongfu, the chief executive and chairman of Alibaba's local-services division, which comprises food-delivery business Ele.me and map business Amap, will step down at the end of the month, a company spokesperson said Friday.

Wu Zeming, chief technology officer of several Alibaba units, will assume the role of chairman at Ele.me, while Han Liu will become chief executive of the business. Liu Zhenfei and Guo Ning will take on roles as Amap's chairman and chief executive, respectively.

The changes come after Alibaba named co-founder Eddie Wu as chief executive of the group and head of its cloud-computing unit in September. Wu, who in December also assumed leadership of the company's flagship e-commerce businesses Tmall and Taobao, has been tasked with righting a tech titan in the midst of a relative slump.

Alibaba was a major driver of China's growing consumer economy as it pioneered online shopping in the world's second-largest economy. Over the years, it expanded into cloud computing, physical supermarkets, digital entertainment, delivery and more. But after an explosive stock rise following its 2014 initial public offering, Alibaba shares lost most of those gains amid the rise of a host of rivals. It now trades near its all-time low.

The food delivery and maps unit has been a drag on Alibaba's earnings in recent years. Its revenue in the latest quarter rose 13% from a year earlier to more than 15 billion yuan ($2.09 billion)--accounting for less than 6% of Alibaba's overall revenue--but adjusted Ebita was a loss of CNY2.07 billion.

Analysts say the shakeups are a sign of the company's determination to retool its strategy as it faces competitive pressure in almost all its major businesses from e-commerce rivals PDD, Douyin and JD.com, food-delivery giant Meituan and Baidu's map services.

"The company is using managers with more technical background," equity analyst Xiaoyan Wang from 86 Research said. "We can clearly see the CEO Eddie Wu is reviewing the businesses of different sectors and may try to find different strategy priorities for the company."


Write to Jiahui Huang at jiahui.huang@wsj.com


(END) Dow Jones Newswires

03-01-24 0719ET