Despite the acceleration of cloud computing, profits fell short of expectations, and Alibaba’s stock price fell 3% before the market opened. | Wilnesh News

Alibaba Its core e-commerce business continued to face headwinds and missed revenue and profit expectations for the June 2024 quarter due to intensifying competition and cautious Chinese consumers.

At 06:58 a.m., Alibaba’s stock price fell approximately 3.49% in U.S. pre-market trading

Here’s how Alibaba’s June quarter performance compares to London Stock Exchange Group forecasts:

• income: 243.24 billion yuan (US$34.01 billion), compared with expectations of 249.05 billion yuan.
• net income: 24.27 billion yuan, expected to be 26.91 billion yuan.

Revenue increased by 4% annually, and net profit decreased by 29% annually. Alibaba said the drop in net profit was “mainly due to lower operating income” and “increased impairment losses” on investments.

Alibaba has been seeking to reignite growth after a tumultuous 2023, when it undertook its largest-ever overhaul of its corporate structure. High-profile changes in management followed, with Eddie Wu taking over as chief executive in September.

The e-commerce giant has been grappling with wary Chinese consumers and growing competition from rivals Jingdong and Temu’s master PDD.

Since taking the reins, Wu has worked to get Alibaba’s core Chinese e-commerce business back on its feet. The company is currently in a transition phase, with plans to focus more on third-party merchants selling in China through its platforms (Taobao and Tmall) while relying less on its direct sales business.

Wu has previously said the company intends to release new monetization features for its e-commerce platform, which will allow Taobao and Tmall businesses to resume growth in the second half of 2025.

In the June quarter, sales of Taobao and Tmall Group, which represent Alibaba’s e-commerce business in China, fell 1% from the same period last year to 113.37 billion yuan.

At the same time, Alibaba’s overseas online shopping businesses such as Lazada and AliExpress continued to become highlights, with sales in the international e-commerce department growing by 32% compared with the same period last year.

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