Daniel Zhang, who recently stepped down as chairman and CEO of Alibaba, has surprised many by also relinquishing his role in overseeing the company’s cloud division, just months after taking it on. This decision caused a 3% drop in Alibaba’s stock in Hong Kong on Monday.

This move marks Zhang’s complete departure from Alibaba’s core management team, as the company faces a challenging economic environment in China. Zhang had previously stated that one of his reasons for stepping down as CEO was to focus on the spin-off of Alibaba’s cloud business.

Eddie Yongming Wu has been appointed as the acting chairman and CEO of Alibaba’s cloud unit, according to the company’s announcement on Monday. 

Meanwhile, Joseph C Tsai, one of Alibaba’s co-founders, has assumed the role of chairman of Alibaba Group, and Wu is now the chief executive officer and director, completing the company’s leadership transition.

Alibaba has been undergoing a significant restructuring, dividing itself into six business units with the eventual goal of spinning most of them off and listing them to maximize returns for shareholders. 

In May, the company announced its intention to list its cloud unit within the next year, a plan that it reaffirmed in this latest announcement.

Daniel Zhang, who joined Alibaba in 2007, is well-known for creating the company’s annual Singles Day online shopping event. He took over as CEO in 2015 and later became chairman in 2019. 

Zhang’s departure marks the end of an era during which Alibaba became China’s largest company and expanded into various new sectors. 

He will now oversee a $1-billion technology investment fund on behalf of Alibaba.