Alibaba Beats Revenue Estimate, Misses EPS Forecast

The shares of Alibaba Group Holding Ltd. (NYSE: BABA) edged up by up to 3 percent during the pre-market hours on May 5, after the Chinese ecommerce giant reported its fourth quarter earnings results. The company has announced earnings per share (EPS) of $0.47, which failed to meet the  $0.54 EPS forecast of the Street. Meanwhile, Alibaba’s net revenue of about $3.75 billion managed to beat the $3.57 billion estimate of market analysts.

According to the Chinese ecommerce giant’s CEO Mr. Daniel Zhang, “Alibaba Group finished the fiscal year on a very strong note. In March, we surpassed RMB3 trillion in annual GMV, and our revenue for the year was over RMB100 billion. We achieved strong growth in mobile users, active buyers, and transactions.”

The ecommerce company revealed that its revenue from the retail marketplace in China amounted to approximately $2.84 billion, which represented a growth of 41 percent on a year-over-year basis. The annual active buyers increased by around 16 million, in sequential terms, to 423 million. On the other hand, the gross merchandise volume came in at $115 billion, up by $22 billion.

In addition, the mobile revenue of Alibaba climbed by 149 percent on a year-over-year basis to reach $2.03 billion. The monthly active users of the ecommerce platform rose by 17 million sequentially to 410 million, while the mobile  gross merchandise volume contributed 73 percent of the total gross merchandise volume. Meanwhile, the internet infrastructure business and cloud computing resumed its strong growth, as the company’s revenue soared by 175 percent on a year-over-year basis to hit $165 million.

Furthermore, Alibaba further stated that the Mobile Taobao app, which is a consumer community platform, is pushing the social commerce. The app serves more than just a sales and distribution channel for sellers. The ecommerce giant stated that merchants  liked to use Tmall to connect and establish relationships with their clients.

Apart from this, the Chinese firm mentioned that it accomplished its investment in Youku Tudou in the month of April this 2016. Through this, it “will be able to offer a multi-channel content distribution platform that may delight and entertain users on PCs, mobile devices, and in the living room as well.”

In other news, the Chinese ecommerce major also acquired a controlling stake in Lazada, which is Southeast Asia’s leading platform. Alibaba purchased the shares for nearly $1 billion. The ecommerce juggernaut intends to utilize this to ramp up its international strategy to reach the 560 million consumers in the stated region.

According to the company’s CFO Maggie Wu, “With several consecutive quarters of increases in revenue per active buyer and revenue per mobile MAU, we showcase the resiliency and growing clout of Chinese consumers. This bodes well for our business, as our annual active buyers on our China retail marketplaces increased to 423 million.”

As of 9:58 AM GMT -4 on May 5, 2016, the stock of Alibaba is changing hands at $79.15, up by 4.39 percent or 3.33. Moreover, its market capitalization currently stands at 198.97 billion.

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