Xunlei(US:XNET) Sou Hu Cai Jing·2026-01-15 03:00Core Viewpoint - The recent lawsuit filed by Xunlei against former CEO Chen Lei highlights ongoing issues of corruption and mismanagement within the company, bringing renewed attention to past scandals and the need for corporate governance reform [1][16]. Group 1: Legal Actions and Allegations - Xunlei has officially sued former CEO Chen Lei for infringing on company interests, with the Shenzhen court accepting the case [1]. - Chen Lei was previously accused of embezzling company assets and creating false contracts to siphon funds, leading to his dismissal in April 2020 [1][3]. - The internal investigation revealed that Chen Lei allegedly used a company called Xingronghe to facilitate the misappropriation of nearly 200 million yuan [5][8]. Group 2: Financial Performance and Mismanagement - During Chen Lei's tenure, Xunlei reported a total loss of nearly 1 billion yuan over three years, with significant declines in revenue attributed to poor business decisions and corruption [3][16]. - The company’s revenue for Q3 2023 was reported at $126.4 million, a 57.7% increase year-over-year, indicating a recovery from past financial mismanagement [16]. Group 3: Internal Dynamics and Corruption - Chen Lei's leadership was characterized by a concentration of power among a small group of executives, notably involving his relationship with Dong Xue, which raised concerns about conflicts of interest and nepotism [13][17]. - Allegations include the misuse of company funds for personal benefits, such as excessive reimbursements and hiring of unqualified consultants, which were actually relatives of Dong Xue [14][15]. - The internal culture under Chen Lei reportedly encouraged unethical behavior, with employees feeling pressured to conform to personal relationships for career advancement [14][18]. Group 4: Implications for Corporate Governance - The situation at Xunlei serves as a cautionary tale for other companies regarding the selection and oversight of executive leadership, emphasizing the importance of ethical standards and accountability [17][18]. - Legal actions taken by Xunlei are seen as a necessary step to reclaim lost assets and restore investor confidence, signaling a commitment to addressing past wrongs [16][18].