Alibaba Sales Surge During Lockdown
Alibaba Group Holding Ltd reported on Friday their forecast beating their fourth-quarter revenues and profits. This is as more people shopped online for essentials because of the coronavirus lockdowns.
As everyone stayed indoors and brick-and-mortar stores remained shut during the health crisis, online orders surged. The company’s core commerce business rose nearly 19% to 93.87 billion yuan or $13.16 billion in the quarter.
Stock market reports say the company’s revenue at its cloud computing business rose by about 58%.
Maggie Wu, Alibaba CFO, said the results contrasted with the company’s guidance from the previous quarter. That was when it had predicted a drop in revenue.
She said she was pleased to report that they reported better than expected results in the March quarter.
China’s economy is starting up again far ahead of major economies in Europe and the United States. The e-commerce company said it expected to generate more than 650 billion yuan in revenue in fiscal 2021.
It has been expanding into new businesses and technologies to cope with heightened competition in online shopping from smaller rivals.
Alibaba Revenue Rises
Its overall revenue rose to 114.31 billion yuan or $16.02 billion in the quarter ending on March 31. That was from about 93.50 billion yuan a year earlier.
Stock market analysts had expected revenue of 107.04 billion yuan.
Alibaba said that gross merchandise volume exceeded $1 trillion for the first time in its fiscal year ending in March.
Excluding items, it earned 9.20 yuan per American Depository Share. Analysts were expecting 6.10 yuan per ADS.
U.S.-listed shares of the company were marginally up in stock trading before the bell.
CFO Wu said it was closely monitoring a bill passed this week by the U.S. Senate. It would have required listed companies to reveal they are not owned by a foreign government. The bill is written to apply to all foreign companies, particularly China.
Wu said, referring to U.S. accounting rules, that Alibaba’s financial statements are prepared in accordance with U.S. GAAP. They have been an SEC filer since 2014 and hold themselves to the highest standard of transparency.
Meanwhile, Alibaba began allowing U.S. companies to sell through Alibaba.com last summer. This was after they had previously used the platform mainly as a way to connect Chinese suppliers with buyers across the world.
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