Dive Brief:
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Alibaba on Thursday reported fiscal fourth-quarter revenue rose 39% year over year to RMB 24.2 billion ($3.7 billion U.S.), with marketplace revenue rising 41% year over year to RMB 18.34 billion ($2.84 billion U.S.), beating Thomson Reuters average analyst estimates.
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Annual active buyers on Alibaba’s China retail marketplaces increased to 423 million, a hike of 16 million over the prior quarter, while mobile app users in March 2016 reached 410 million, an increase of 17 million over December 2015.
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As with Amazon, Alibaba’s cloud services represent a formidable chunk of its business, growing 175% year-over-year in fiscal Q4 to RMB 1.066 billion ($165 million U.S.), an increase over the 126% year-over-year growth rate achieved in the prior quarter.
Dive Insight:
Alibaba has struggled somewhat to maintain the momentum sparked by its massive initial public offering in 2014, hampered in part by evidence of a slowdown in the Chinese economy.
Alibaba has made significant investments in a variety of overseas businesses (including a billion-dollar buy in Singapore-based e-commerce startup Lazada Group, its biggest foreign investment so far) in an effort to expand more widely across Asia. The retail giant is also making concerted moves to increase the number of big-name brands on its marketplace, and says it’s working hard to bring down the worrisome number of counterfeits on offer.
While some analysts told CNBC that Alibaba’s strength is an indication that the Chinese consumer base remains strong, others questioned whether its retail operations are at all profitable. Kynikos Associates founder Jim Chanos, for one, is still betting against Alibaba, saying he’s doubtful about its cash flow and questions the company’s own metrics, according to CNBC.
"We just don't see how profitable or unprofitable that business is," Chanos said.
Alibaba's American depository shares rose 3.5% Thursday, according to CNBC and Reuters. Its U.S.-listed shares had fallen 7% so far this year through Wednesday’s close.
