Alibaba Group Holding Limited (BABA) reported 34 percent growth in its e-Commerce business revenue and 59 percent growth in its cloud business, surpassing the growth rates of the cloud businesses of Amazon and Microsoft. For the upcoming quarter and the November 11 event, Alibaba has high hopes.
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After the biggest Chinese public company announced results for the second quarter of fiscal 2021, which ended in September, company’s shares grew 4.24 percent in Friday trading. There is a rise of 35.7 percent in stock’s price since the start of the year that is down almost 8 percent this week.
News of the suspension of the IPO of the financial technology company Ant Group, which was expected to be the largest IPO in history, followed Alibaba’s quarterly report, with Alibaba controlling approximately 33 percent of the shares of Ant Group. In the last quarter, Alibaba received nearly 4.7 billion RMB from Ant Group which is a large part of its overall profit.
The company reported $4.83 in earnings per share, higher than the $2.08 per share forecast by analysts, but overall quarterly earnings dropped from that of a year ago.
The quarter’s total revenue rose 30 percent (compared with the value of last year) to $22.83 billion, but was below the $23.19 billion forecast.
Revenue from the core e-Commerce group soared 34% to $18.9 billion, but was slightly below the estimates of analysts. The revenue from Alibaba Cloud rose 59 percent to $2.4 billion meeting expectations.
Alibaba Cloud is the world’s fourth largest provider of public cloud computing, according to Synergy Research Group, after Amazon Web Services, Microsoft Azure and Google Cloud. However, the cloud business of Alibaba is growing faster than the 29 percent revenue growth of Amazon Web Service or Microsoft Azure’s 48 percent growth in the same quarter ended in September.
In the current quarter, the management of Alibaba also expects strong growth from its core e-commerce sector. For the next year, revenue growth could benefit from the highest annual sales on November 11. This year, sales of the 24-hour event totaled $38.4 billion, a 26 percent rise over last year’s same event.
