Alibaba falls short of expectations with its latest financial results and cuts f...
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Alibaba falls short of expectations with its latest financial results and cuts forecast
3 hours agoOn Thursday, Alibaba presented its financial report for the July-September quarter, with revenue and earnings falling short of forecasts.
Revenue increased by 29% year-on-year to 200.69 billion yuan ($31.43 billion), which was lower than the 206.173 billion yuan ($32.28 billion) projected by analysts. Compared to the previous quarter, this quarter's growth rate has decreased
The adjusted net profit was 28.52 billion yuan, a 39% decrease year-on-year. The decline in profits was due to increased investment in its key strategic areas, the company explained, adding that investments in areas within its commerce segments, such as Taobao deals, local consumer services, community marketplaces, and Lazada, rose by 12.58 billion yuan ($1.97 billion) from the year-earlier period.
Alibaba’s core commerce business saw revenue grow 31% year-on-year to 171.17 billion yuan, missing expectations.
Despite being China's largest e-commerce company, Alibaba faces increasingly fierce competition from counterparts JD.com and Pinduoduo, as well as social media companies like TikTok's parent company ByteDance.
In terms of cloud computing business, it increased by 33% year-on-year to 20 billion yuan ($3.13 billion). The adjusted EBITA of this department was 396 million yuan ($62.01 million), compared with a loss of 567 million yuan ($88.79) in the same period last year.
The company also slashed its revenue guidance for its current fiscal year. It previously predicted 930 billion yuan in revenue, or a 29.5% year-on-year growth. However, it now anticipates year-on-year growth to range between 20% and 23%.
Alibaba's US-listed shares are down 9.6% in early Thursday trade. The stock is on track for its worst single-day percentage decrease since December 24, 2020, when it fell 13.3%.
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