Alibaba’s Q3 net profit rises 15% to US$1.1b
Print Edition
ALIBABA reassured investors with a solid rise in profits as the Chinese e-commerce giant released yesterday its first earnings report since successfully completing the world’s biggest stock offering in September.
The company, whose services are similar to those offered by United States Internet titans Ebay, PayPal and Amazon, said its third-quarter net profit climbed by 15 percent to US$1.1 billion.
Adjusted earnings per share, the benchmark used in the US where Alibaba is listed since its US$25 billion stock offer, came in at 45 cents, a 9.4 percent increase in line with analyst expectations.
Revenue soared by 53.7 percent from the same quarter of last year to US$2.7 billion, beating analyst forecasts, and the number of active buyers rose by 52 percent.
However, using compatible GAAP accounting measures its net profit slid nearly 39 percent which the company said was due to a stepped-up writedown in the value of intangible assets and share-based compensation charges.
“We delivered a strong quarter with significant growth across our key operating metrics,” Alibaba Group Chief Executive Jonathan Lu said in a statement.
Headquartered in Hangzhou, capital of Zhejiang Province, Alibaba operates China’s most popular online shopping platform, Taobao, which is estimated to hold more than 90 percent of the online market for consumer-to-consumer transactions.
As it does not sell products directly, but acts as an electronic middleman, Alibaba has been able to generate enviable profit margins.
The company also seems to be managing well the transition to mobile devices.
It pointed to a staggering 1,000 percent rise in revenue generated from people accessing its services via mobile devices, to US$606 million.
Mobile now accounts for 35.8 percent of sales by one measure, up from 32.8 percent in the previous quarter and 14.7 percent one year ago.
“We extended our unrivaled leadership in mobile with 217 million monthly active users on our mobile commerce apps in September,” said Lu.
That represented a 15.4 percent gain from the previous quarter and a 139 percent jump from one year ago.
Chinese operations accounted for four-fifths of revenue, although its international businesses continued to expand strongly.
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