Alibaba's Earnings Rise Remarkably in the Second Quarter
Chinese e-commerce giant Alibaba Group reported on Thursday that it has generated more profits in the second quarter, driven by gains from its core e-commerce business.
The online retail group stated that its net income in the three months ended September 30 remarkably climbed by 146 percent to CN¥17.41 million ($2.63 million), more than doubling the CN¥7.1 million it earned in the same quarter a year ago.
Analysts had expected the company to report earnings of about CN¥12 million. It also showed that the upcoming Singles’ Day event was not a problem for Alibaba’s second quarter. The period usually tends to be slower during this occasion.
Alibaba’s chief executive Daniel Zhang said that their consumer insights and technology innovation were the main contributors behind their customer value proposition across the Alibaba economy.
Diluted earnings per share (EPS) rose to CN¥6.78 per share, adding 128 percent to last year’s CN¥2.97.
Overall revenue grew as much as 61 percent year-over-year to CN¥55.12 million ($8.33 million), compared to CN¥34.29 million in the past year as it strengthened from sales growth in its China and international commerce retail business as well as Alibaba Cloud.
It has also beaten analysts’ estimate of CN¥52 million.
Alibaba’s online retail websites, Taobao and Tmall.com, collectively raised core commerce revenue by 63 percent from CN¥28.49 million to CN¥46.46 million ($7.03 million).
Its cloud computing business was also able to bring in sales of CN¥2.98 million, generating 99 percent more than last year’s CN¥1.49 million.
The company’s chief financial officer Maggie Wu stated that the second-quarter non-GAAP free cash flow of CN¥22.51 million ($3.40 million) will be used to invest in their future growth areas of core commerce, including cloud computing, digital pursuit, and other innovation plans.
As a result of these figures, Alibaba has adjusted its revenue growth forecast for the December quarter from the previous range of 45 to 49 percent, to 49 to 53 percent. It also expects to profit from the acquisition of logistics division Cainiao Network.
Following an upbeat earnings result, the China-based e-commerce group’s shares was up by 0.9 percent to $187.87, after its pre-market trade added 2.8 percent to $191.40 on Thursday.
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