Alibaba posts 35% rise in quarterly profit
Print Edition
ALIBABA’S quarterly profit jumped 35 percent to 24.07 billion yuan (US$3.7 billion) as the company tapped booming e-commerce sales and other initiatives.
The company also said yesterday it would buy a 33 percent stake in its payment affiliate Ant Financial in exchange for certain intellectual property rights owned by the e-commerce giant.
The purchase is a “significant step for Alibaba to enhance our long-term strategic relationship” with the payment affiliate, in exchange for intellectual property rights, said Alibaba CEO Daniel Zhang.
“Importantly, an equity stake in Ant Financial enables Alibaba and our shareholders to participate in the future growth of the financial technology sector, as well as the benefits of user growth and improved customer experience,” he said.
E-commerce income jumped 57 percent to US$11.3 billion in the three months ended December last year and total year-on-year revenue growth surged 56 percent to US$12.8 billion, Alibaba said.
Gross merchandise volume of physical goods sold on the business-to-consumer site Tmall jumped 43 percent from a year ago, as major consumer goods, electronics and luxury brands have established flagship stores on the site.
Alibaba is also increasing its 2018 fiscal year revenue guidance to 55-56 percent, up from its previous estimate of 53 percent annual increase.
“Our core business generated significant cash flow of US$7.1 billion during the quarter, enabling us to invest in new retail, cloud computing, digital entertainment and globalization,” said Chief Financial Officer Maggie Wu.
Alibaba has also been expanding to offline retail in a bid to synergize business to combat rival Tencent Corp. Alibaba and an affiliate invested in a 36 percent stake in Sun Art Group Ltd in November to accelerate expansion of its new retail initiative nationwide.
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