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LeEco planning major business changes as financial woes continue (Update: LeEco says it is committed to US market)
Update: LeEco reached out to us with a statement “we’re committed to the U.S. market”. While things might be a bit tough right now for the company, it looks like they are continuing to push forward with its plans for expanding into the US market.
Things seem to be going from “bad” to “worse” for China-based smartphone and smart TV company LeEco. The company decided to halt trading of its shares this week, after rumors that its falling stock price had triggered margin calls on funds borrowed by the LeEco’s billionaire founder Jia Yueting.
In a statement sent to The Wall Street Journal, a LeEco spokesperson stated that it is currently investigating why its stock price had dropped close to eight percent on Tuesday, and thus made the decision to halt trading. The spokesperson added that the company is “in the process of planning major matters, which are expected to involve integration of industry resources.” Exactly what types of changes are in the works are currently unknown.
Less than two months ago, LeEco was holding a big press conference in San Francisco, announcing its official launch of products in the US. That included its Le Pro3 and Le S3 Android smartphones. However, the press conference was an odd affair, full of unconnected buzzwords and demos of products like an Android-based bicycle that may now never come to market.
Since then, rumors about the company’s financial issues have continued, even though LeEco announced it had raised $600 million in new financing. Last week, sales of its phones began in the US at its own LeMall website, along with Amazon, Target and Best Buy. However, the company could decide to make an early exit from the US market as part of its upcoming changes.