FT News Briefing

EY’s new leader has her work cut out for her

Nov 17, 2023

09:22

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EY's new leader, Janet Truncale, and the challenges she faces at the accounting firm. Alibaba's decision to cancel its cloud business spin-off and the impact on its stock value. The struggles of low-income UK households with mortgage payments. The challenges faced by consulting businesses, particularly in IT consulting, and the potential need to split EY in two to address conflicts of interest.

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Quick takeaways

Alibaba's decision to abandon its plans to spin off its cloud computing business has negatively impacted its share price and raised doubts about its ability to create a new growth story.

The Bank of England's interest rate increases have disproportionately affected low-income mortgage holders in the UK, leading to a high number of borrowers falling behind on their bills and struggling to meet basic needs.

Deep dives

Ali Baba's Stock Declines as Plans to Spin Off Cloud Business Collapse

In a recent announcement, Ali Baba revealed that it is abandoning its plans to spin off its cloud computing business. This decision had a significant negative impact on the company's share price, which dropped by almost 10%. Ali Baba's restructuring efforts, aimed at revitalizing its business, have faced numerous challenges. Investor enthusiasm for China's reopening story has waned, exposing deeper economic issues. Furthermore, difficulties faced by smaller media enterprises and US export controls on crucial semiconductors have affected Ali Baba's cloud business. This turn of events leaves investors skeptical about Ali Baba's ability to create a new growth story.

Introduction

4min

Impact of Announcement on Share Price, Investor Concerns, and Strain on Low-Income Borrowers

3min

EY's Leadership Race and the Challenges Ahead

2min

Challenges Faced by Consulting Businesses and the Case of EY

3min

More than half of low-income UK households with mortgages have fallen behind on one or more of their bills and Alibaba disappointed investors after announcing that it ditched plans to spin off its cloud business. Plus, the FT’s Stephen Foley talks about EY’s new leader Janet Truncale and how she might steer the accounting firm.

Mentioned in this podcast:

Alibaba ditches plans to spin off cloud business and list supermarket

EY picks Janet Truncale as the first woman to lead a Big Four firm

Low-income borrowers hit hardest by Bank of England rate rises

The FT News Briefing is produced by Fiona Symon, Sonja Hutson, Kasia Broussalian and Marc Filippino. Additional help by Manuela Saragosa, Josh Gabert-Doyon, Sam Giovinco, Peter Barber, Michael Lello, David da Silva and Gavin Kallmann. Our engineer is Monica Lopez. Topher Forhecz is the FT’s executive producer. The FT’s global head of audio is Cheryl Brumley. The show’s theme song is by Metaphor Music.

Read a transcript of this episode on FT.com

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