News24
15 May 2019, 20:12 GMT+10
The Alibaba Group posted quarterly revenue and earnings that topped analyst estimates as personalised recommendations drive consumer spending across its shopping sites.
Revenue at China's biggest e-commerce company rose 51% to 93.5bn yuan ($13.6bn) in the three months ended in March, the company said. That compares with the 91.7bn-yuan average of analysts' estimates compiled by Bloomberg. Adjusted earnings-per-share was 8.57 yuan, topping projections for 6.5 yuan.
The Hangzhou-based company predicted revenue in the current financial year of more than 500bn yuan. Recommendations to users based on their preferences are now driving more sales than traditional search, boosting Alibaba's ability to provide targeted advertising for merchants on its main Taobao platform.
That's helping the e-commerce operator generate more revenue at a time escalating U.S.-Chinese tensions threaten to dampen the world's number two economy.
The "testing of new recommendation-based advertising indicates monetization will kick in soon, supporting faster earnings recovery," Binnie Wong, a Hong Kong-based analyst with HSBC, said in a report ahead of the results.
The new features could help improve the conversion rate for merchants, Wong wrote.
Shares of Alibaba rose 2.8% to $174.84 in New York on Tuesday, before the earnings were announced. The stock has gained 28% compared with an 11% gain for the NYSE Composite Index.
Earlier on Wednesday, rival Tencent Holdings Ltd. posted earnings that topped estimates even as revenue growth slowed to the lowest since its 2004 initial public offering.
Alibaba, Tencent to show how China is handling the trade war
Alibaba's full-year revenue rose 51% to 376.8bn yuan, toward the bottom of its forecast range of 375-383bn yuan.
The core commerce business posted revenue of 78.9bn yuan, a jump of 54%.
Revenue from the cloud unit surged 76% to 7.7bn yuan, the company said. The business is becoming a key pillar of growth, with more than half the market in China.
The cloud business could post growth of 46% per year through 2022, according to Bernstein estimates.
In Asia, Gartner forecast that Alibaba last year accounted for 19.6% of the Asian market for infrastructure as a service and infrastructure utility services, two of the most popular forms of cloud business.
That means its regional market share rose by nearly a third from 2017, while Amazon's fell slightly to 11%.
Sales from the digital media entertainment unit rose 8% to 5.7bn yuan.
Get a daily dose of Beijing Bulletin news through our daily email, its complimentary and keeps you fully up to date with world and business news as well.
Publish news of your business, community or sports group, personnel appointments, major event and more by submitting a news release to Beijing Bulletin.
More InformationNEW DELHI, India: Apple has ramped up shipments of iPhones from India to the United States, chartering aircraft to move hundreds of...
TAIPEI, TAIWAN: A strong push from artificial intelligence demand lifted TSMC's quarterly revenue to new highs, with the chipmaker...
The US president's Golden Dome initiative envisions armed satellites designed to neutralize incoming missiles ...
The US presidents Golden Dome initiative envisions armed satellites designed to neutralize incoming missiles Elon Musk's SpaceX has...
New Delhi [India], April 18 (ANI): In a major step to combat the worsening water crisis in the national capital, the Delhi government...
Narendra Modi said he discussed collaboration in technology and innovation with the tech mogul as Tesla and SpaceX eye entry to the...
FORT WORTH, Texas: American Airlines will begin offering free high-speed Wi-Fi to passengers in January 2026, joining a growing list...
LONDON, UK: Electric vehicle sales surged globally in March, with strong growth in China and Europe offsetting slower momentum in North...
New York City: New York: Goldman Sachs has signaled a prolonged downturn in oil prices, forecasting a steady decline through the end...
NEW YORK, New York - U.S. stocks were volatile again Friday as President Donald Trump blasted Federal Reserve chair Jerome Powell for...
BRUSSELS, Belgium - The Europesn Central Bank has slashed official interest rates in the wake of the financial crisis triggered by...
BISMARCK, North Dakota: Federal officials have ordered the company running the Keystone Pipeline to take several safety steps after...