Alibaba Group Holding Ltd.’s chief executive officer (CEO) Daniel Zhang has called on the company’s employees on Tuesday, Aug. 25, to focus on serving their customers and set aside reports about the plummeting stock markets, as the company’s shares fell below their initial public offering (IPO) price for the first time, the Bloomberg News reported.
According to the report, Zhang, who became Alibaba's CEO three months ago, sent the memo to the company's 35,000 workers, urging them to ignore the market turmoil. Alibaba lost about $128 billion in market value since its November peak as Chinese economy slowed down.
"This is not the first time that the global stock market has plunged," Zhang wrote in the email. "It is not the last time, either. I hope everyone can shift the focus from the stock market to customers."
On Monday, Aug. 24, Alibaba fell 3.5 percent to close at $65.80 in New York, dropping below its September IPO price of $68 after a global market retreat revived concerns of investors on Alibaba's sales growth.
U.S. stocks dropped on the same day, sending a correction into the Standard & Poor's 500 Index, with Chinese shares dropping the most since 2007.
"Let's forget about the stock prices," Zhang said in his memo. "We should not be distracted by short-term obstacles, but plan for the future and stick to it."
Alibaba shares peaked at $119.15 in November, with Alibaba's investors reaching more than 300 million customers. But concerns about the decelerating Chinese economy and increased competition from JD.com Inc. caused a decline of investors, amid government reports that Alibaba did not act on counterfeit goods on its site.
"Sometimes it is a lonely journey, sticking to your principles," Zhang wrote. "But we have to go through lots of ups and downs during this journey. We are not in a single fight, but a fight that lasts for 102 years."
Alibaba's 102-year journey was mentioned by Jack Ma in an investor letter appended to its original IPO prospectus.
Zhang replaced Jonathan Lu as CEO in May. He is one of those responsible for the success of Alibaba's "Singles Day" shopping gala.