DE4CC0DE-5FC3-4494-BCBF-4D50B00366B5
Technology

Alibaba Misses Revenue Estimates In Q1 As E-commerce Growth Slows

By Dayeeta Das
Share this article
Alibaba Misses Revenue Estimates In Q1 As E-commerce Growth Slows

China's Alibaba Group Holding Ltd missed analyst estimates for first-quarter revenue on Tuesday, as its e-commerce business was hurt by rising competition from smaller players such as JD.Com Inc and Pinduoduo Inc.

Alibaba's results mirror those of e-commerce giant Amazon.com Inc in the United States, as the easing of pandemic-related restrictions has led to more consumers visiting physical stores rather than ordering online.

Core commerce revenue for Alibaba rose about 35% to 180.24 billion yuan in the quarter, compared with estimates of 184.23 billion yuan. In the fourth quarter, the unit's revenue was up more than 70%.

Overall, revenue rose about 34% to 205.74 billion yuan ($31.83 billion) in the first quarter ended June 30, below estimates for 209.39 billion yuan, according to IBES data from Refinitiv.

Quarterly Performance

Net income attributable to shareholders rose to 45.14 billion yuan, compared with 47.59 billion yuan a year earlier.

ADVERTISEMENT

On an adjusted basis, the company earned 16.60 yuan per share, above estimates for 14.43 yuan.

Ant Group, the fintech affiliate of Alibaba Group, recorded a profit of about 13.48 billion yuan in the quarter ended March, according to the Chinese e-commerce giant's filing.

Alibaba, which holds about a third of Ant, posted a profit of 4.49 billion yuan for the quarter ended 30 June from its investments in the financial conglomerate.

Revenue in Alibaba's cloud computing division grew 29% year-on-year, reaching 16.05 billion yuan ($2.49 billion)

ADVERTISEMENT

The results come amid an ongoing Chinese regulatory crackdown on industry, during which Alibaba has become one of the main targets.

Late last year, regulators halted a planned $37 billion IPO of Ant Group in Shanghai and subsequently called for a restructuring of the financial unit.

Later, in April, China's anti-monopoly regulator fined Alibaba $2.75 billion for engaging in anti-competitive practices.

Regulatory Changes

During an earnings call with investors, Alibaba CEO Daniel Zhang said the company would continue to monitor the impact of ongoing regulatory changes on the company's business.

ADVERTISEMENT

He cited a recent regulatory crackdown on community marketplace platforms letting sellers offer items below market price as one example of a sector the company is monitoring.

"We are in the process of studying the regulatory requirements, evaluating the potential impacts on our relevant businesses and we will respond positively with actions," Zhang said.

News by Reuters, edited by ESM. For more Technology news, click here. Click subscribe to sign up to ESM: European Supermarket Magazine.

Get the week's top grocery retail news

The most important stories from European grocery retail direct to your inbox every Thursday

Processing your request...

Thanks! please check your email to confirm your subscription.

By signing up you are agreeing to our terms & conditions and privacy policy. You can unsubscribe at any time.