Alibaba’s profit rises 58%, but sales fall short of expectations | Wilnesh News

Chinese e-commerce giant Alibaba Its September quarter profit beat forecasts on Friday, but sales fell short of expectations as a downturn in the world’s second-largest economy hit consumer spending.

Alibaba said its net profit for the quarter ended Sept. 30 rose 58% year-on-year to 43.9 billion yuan ($6.07 billion) due to the performance of its equity investments. This compares with the London Stock Exchange Group’s (LSEG) forecast of $25.83 billion.

“The year-over-year increase was primarily attributable to changes in the mark-to-market value of our equity investments, lower investment impairments and higher operating income,” the company said of the annual profit increase in its income statement.

Meanwhile, revenue was 236.5 billion yuan, up 5% year-on-year, but lower than analysts’ forecast of 238.9 billion yuan, according to London Stock Exchange Group.

The company’s New York-listed shares have risen nearly 17% so far this year. The stock was up 3% in pre-market trading at 12:24pm London time following the release of quarterly earnings.

The market is currently paying attention to whether Beijing will adopt a series of stimulus measures in the near future, including a five-year economic stimulus plan The 1.4 trillion yuan package announced last week, It will help revive the country’s growth and stem the long-term slump in the real estate market.

So far, the impact on the retail sector looks promising, with sales growing 4.8% better than expected Annual growth in October comes as China’s recent Singles Day shopping holiday – widely seen as a barometer of consumer confidence across the country – regained some luster.

Alibaba strongly supports “strong growthDuring the holiday season, its Taobao and Tmall Group businesses saw gross merchandise volume (an industry metric that measures sales over a period of time and does not equate to a company’s revenue), as well as “a record number of active buyers.”

“Alibaba’s prospects remain closely tied to the trajectory of the Chinese economy and changing regulatory policies,” ING analysts said on Thursdaypointed out that the company’s report on Friday will reveal the growth momentum of China’s economy.

At the same time, the sales of overseas online shopping businesses such as Lazada and AliExpress increased by 29% compared with the same period last year, reaching 31.67 billion yuan.

Alibaba’s Cloud Intelligence Division reported that sales in the September quarter rose 7% annually to 27.65 billion yuan, while sales in the three months to June increased 6% annually. The slight acceleration comes as the company continues to work to leverage its cloud infrastructure and reposition itself as a leader in the booming field of artificial intelligence.

“The growth of our cloud business has accelerated compared with previous quarters, with double-digit growth in public cloud product revenue and triple-digit growth in artificial intelligence-related product revenue. We are more confident than ever in our core business and will continue to The investment supports Alibaba CEO Eddie Wu in a statement on Friday.

Alibaba was hampered last year by Beijing’s sweeping crackdown on big internet and tech companies in 2022 Overhauled the division’s leadership and shaped it into a future growth driver, strengthening competition with rivals including Baidu and Huawei domestic, and Microsoft and OpenAI in the United States

Alibaba launched its own ChatGPT-style product, “Unified Qianwen” last year, and this week launched its own artificial intelligence search tool for small businesses in Europe and the Americas, winning Important five-year partnership In September, it provided cloud services to Indonesian technology giant GoTo.

Speech at Feitian Conference in SeptemberAlibaba’s Wu said the company’s cloud unit is “investing in the research and development of artificial intelligence technology and the construction of global infrastructure with unprecedented intensity,” noting that the future of artificial intelligence “has only just begun.”

This breaking news story is being updated.