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Alibaba Warns Of Slowest Revenue Growth Since Debut

China's Alibaba Group Holding Ltd forecast annual revenue to grow at its slowest pace since its 2014 debut and its second-quarter results missed expectations amid slowing consumption in the country and tighter regulatory scrutiny.

US-listed shares of Alibaba, which expects its fiscal year 2022 revenue to grow by 20% to 23%, were down 3% before the opening bell on Thursday.

The company last week recorded its slowest sales growth during its annual Singles' Day, the world's biggest online shopping fest.

Regulatory Crackdown

China's big tech companies have also been under pressure as the country's regulators clamped down on powerful players from Alibaba to ride-hailing giant Didi Global Inc, citing antimonopoly and security reasons.

Regulatory crackdown had also hurt Chinese gaming and social media giant Tencent Holdings, which posted its slowest quarterly revenue growth since it went public in 2004.

Alibaba's founder Jack Ma has been largely out of public view since criticizing China's regulatory system last year. His empire then faced heavy official scrutiny, which led to the suspension of Ant's $37 billion IPO last November.

Read More: Alibaba Should Align Operations With Consumer Preferences, Says Analyst

Quarterly Performance

For the reported quarter, the e-commerce juggernaut's revenue growth rose 29% to 200.69 billion yuan ($31.44 billion), its slowest rate of growth in six quarters. Analysts on an average had expected revenue of 204.93 billion yuan, according to Refinitiv data.

On an adjusted basis, it earned 11.20 yuan per share, below estimates for 12.36 yuan.

Alibaba's fintech affiliate Ant Group recorded a quarterly profit of about 19.7 billion yuan for the quarter ended June. It records its profit from Ant one quarter in arrears.

In August, the company missed analyst estimates for first-quarter revenue, as its e-commerce business was hurt by rising competition from smaller players such as JD.Com Inc and Pinduoduo Inc.

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

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