Alibaba beats estimates on record Singles’ Day sales

(Reuters) – China’s Alibaba Group Holding Ltd. beat analysts ‘estimates for its second quarter results on Thursday, driven by record sales during its annual Singles’ Day shopping promotion and a growing demand for cloud computing services.

FILE PHOTO: The logo of Alibaba Group is seen during Alibaba Group’s 11.11 Singles Day a global shopping festival, at the registered office of the company, in Hangzhou, Zhejiang province, China, on November 10, 2019. (REUTERS photo/Aly Song, File/Photo

The e-commerce giant typically announces its highest sales in the December quarter due to its mega – “Singles ‘ Day” shopping bonanza ” in the month of November. The company said that sales during the 24-hour shopping event hit a record of $38.4 billion in 2019.

Alibaba primarily generates revenue through the sale of advertising and promotional services for third-party merchants that list products on e-commerce sites, Taobao and Tmall.

The company said it was in support of the fight against the corona virus outbreak in China, to ensure the supply of daily necessities of life, and the adoption of relief measures for the traders.

Alibaba affiliate, Ant Financial’s MYBank has been said that it could be a 20 billion yuan ($2.86 billion) in loans to companies in China, in the wake of the outbreak.

The outbreak, which originated in the city of Wuhan, which has resulted in businesses laying off workers, in search of cheaper funding and are struggling to restart production after an extended new year’s holiday as well as supply chains remained disrupted.

The epidemic is expected to pile more pressure on China’s economy, as the country is drawn with the Phase 1 deal with the United States of america to enlighten a long-term war, this trade had an impact on the growth rate.

Sales in the core of the company’s commerce business jumped by 38% to 141.48 billion yuan ($20.26 billion) in the third quarter, which ended on dec. 31, while revenue at its cloud-computing unit, has increased from 62 percent to 10.72 billion yuan.

Net income attributable to ordinary shareholders amounted to 52.31 billion yuan, of 33.05 billion yuan.

With the exception of the items, the company earned 18.19 yuan per American Depositary Share. Analysts had expected to 15.75 yuan per ADS, in accordance with the IBES data, on Refinitiv.

The turnover has increased from around 38% at 161.46 billion yuan, beating estimates of the 159.28 billion yuan.

U.S.-listed shares of the company were up nearly 1% at $226.30 in premarket trading.

Reporting Akanksha Rana, Bengaluru, and Josh Horwitz) in Shanghai; Editing by Sriraj Kalluvila

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