Alibaba quarterly profits almost double to $1.55 bn

Alibaba posts strongest sales quarter since 2014 IPO, helped by China's online shoppers

Shares of Alibaba Group Holdings (BABA) were lower by 2.6% in early trading on results for the fourth quarter, which fell below expectations despite a doubling of fiscal fourth quarter earnings.

Alibaba said growth in new business lines contributed to an increase in total revenue to 38.6 billion yuan ($5.6 billion) in the quarter to the end of March, above an average forecast of 36 billion yuan according to Thomson Reuters I/B/E/S.

Despite the revenue growth, Alibaba's adjusted earnings-per-share of 4.35 yuan failed to meet estimates of 4.51 yuan.

The humble sandle-wearing former English teacher has become an icon for e-commerce entrepreneurs after he founded Alibaba 16 years ago and today has a market capitalization of US$246.12 billion. Initially, Alibaba shares fell as much as 5.6% to $114 in NY, the biggest intraday drop in nearly a year.

While Chinese consumption remains strong, the world's second largest economy showed signs of cooling as retail sales and industrial output growth sputtered in April with regulators cracking down on swelling financial leverage.

Income tax expenses soared 149 percent to 4.6 billion yuan in the March quarter.

The firm acquired the Singapore e-commerce site Lazada a year ago. Growing Chinese affluence is propelling billionaire founder Jack Ma's worldwide expansion, which include helping a million American businesses tap Chinese consumers and reaching foreign shoppers through AliExpress.

Alibaba has said it also plans to expand internationally for future growth. Revenue in those nascent divisions is surging, but they are yet to make money. The increases were mainly driven by the robust revenue growth of its China commerce retail business and Alibaba Cloud, as well as the consolidation of recently acquired businesses Youku Tudou and Lazada, the company said.

Revenue from the firm's core e-commerce business unit increased 47% to 31.57 billion yuan, above the previous quarter's 45% rise. Alibaba will need "further spending to fill out its original content offerings". It closed the year with a loss of 1.68 billion yuan (US$244 million), improving on last year's operating loss of 2.61 billion yuan (US$378.1 million).

Digital media and entertainment revenue grew even faster, rising 234% year-on-year to $571m.

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