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TEHRAN, May 15 - Chinese e-commerce giant Alibaba Group Holding Ltd beat fourth-quarter revenue forecasts on Wednesday, thanks to growth in its core business and its diversification into cloud computing and other services.
TEHRAN, Young Journalists Club (YJC) -Alibaba is diversifying to include new business lines such as cloud computing as a boom in its core e-commerce has peaked and its top line growth is slowing.
It reported a 51% increase in group revenue for January-March from a year earlier to 93.50 billion yuan ($13.6 billion), beating estimates of 91.58 billion yuan, according to IBES data from Refinitiv.
Sales excluding revenue from consolidated businesses grew 39 percent year-on-year.
While still solid, Alibaba’s top-line growth rates have slowed sharply from a few years ago, as have those of its domestic rivals such as JD.com, which last week reported its slowest quarterly revenue growth since it listed in 2014.
Shares in Alibaba rose more than 2% to $179.79 in pre-market trading in New York after its fourth-quarter results release.
It said its net income attributable to ordinary shareholders rose in the quarter to 25.83 billion yuan from 7.56 billion yuan in the same period a year earlier.
Investors were impressed by the performance of new businesses.
The group has made money primarily by selling advertising and promotional services to third-party merchants that list products on Taobao and Tmall, two of its e-commerce sites, but has also in recent years invested heavily in cloud computing.
In another change of tack, it opened 135 supermarkets in China under its Hema division, according to its earnings release.
Revenue from the company’s cloud computing business rose 76% in the fourth quarter, it said.
It is still a relatively small part of Alibaba’s overall business, accounting for 8% of group revenue in the fourth quarter. However, the company is now the world’s third-largest cloud service provider, after Microsoft Corp and Amazon.com Inc, and the largest in China with a market share of over 40%, according to data from IDC.
Source: Reuters
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