5 in 7 LeEco divisions losing money

Updated 2017-07-12 14:17:39 Global Times

Among the seven divisions of LeEco, only LETV and Le Vision Pictures are profitable, according to media reports on Tuesday.

According to a due diligence report by a financial institution, by the end of September 2016, the total assets of LeEco were about 67 billion yuan (.8 billion) and total liabilities were 63 billion yuan (.25 billion).

In the first three quarters of 2016, LeEco recorded total revenues of 40 billion yuan (.87 billion) with an overall loss of 9.73 billion yuan (.43 billion).

LeMobile, the smartphone business, posted the biggest loss at 5.66 billion yuan (1 million), followed by LeSports at 2.63 billion yuan (6 million) and LeSEE, the group's vehicle unit, at 1.34 billion yuan (6 million), 21st Century Business Herald reported on Tuesday.

Monday was payday for LeEco employees, but by the end of the day, no staff in Le Holdings and its divisions were paid, domestic news site huanqiu.com reported on Tuesday.

On Tuesday morning, an interviewee from Le Holdings confirmed that the company is dealing with financial strain and planned to postpone the payroll for one month, although it would pay employees' social insurance and housing funds in full, according to huanqiu.com.

LeEco founder Jia Yueting on Tuesday posted on his microblog that "the FF91 high-end factory" will be moved to a new site, to prepare for mass production.

On Thursday, he stressed his commitment to the dream of reforming the auto industry, and said that all debtors would be paid in time, despite the current financial difficulties.

However, Faraday Future, an U.S.-based electric car startup backed by Jia, has given up on plans to build a billion factory in Nevada for its forthcoming FF91 vehicle, the Financial Times reported on Tuesday.

Its first production vehicle, the FF91, which was unveiled in January, is currently scheduled for launch next year, BBC reported.

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