Alibaba’s income growth slows to 3-year low in Q2
Print Edition
ALIBABA Group Holding Ltd’s revenue for the three months ended in June rose 28 percent, missing analysts’ estimates, with growth slowing to its lowest rate in more than three years.
China’s biggest e-commerce company posted quarterly revenues of US$3.27 billion, below an expected US$3.39 billion, according to a Thomson Reuters SmartEstimate poll.
The drop in revenue growth came as gross merchandise volume — the total value of goods transacted across Alibaba’s platforms — rose 34 percent to 673 billion yuan (US$105 billion), also rising at its slowest pace in more than three years.
Alibaba, which has a market value of US$194 billion, is branching out from its online-only shopping platforms in a bid to stem a slowdown in revenue growth and the value of goods transacted over its websites.
We “made significant progress monetizing our mobile traffic, with our mobile revenue exceeding 50 percent of our total China commerce retail revenue for the first time,” Maggie Wu, Alibaba’s chief financial officer, said in a press release.
On Monday, Alibaba announced its purchase of a 20 percent stake in retailer Suning Commerce Group Co, a deal that could give it more traction in logistics and electronics, areas in which smaller but growing rival JD.com specializes.
Alibaba’s strategic priorities are internationalization, beating out competition in mobile, expanding into rural China and investing in cloud computing, Chief Executive Daniel Zhang said in the release.
The company’s non-GAAP net income was US$1.5 billion for its first quarter for the financial year ended in March 2016, up 30 percent year on year.
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