Alibaba's Latest Earnings Highlight Mixed Results and Strategic Shifts

Published 10 hours agoBABA

Alibaba's Latest Earnings Highlight Mixed Results and Strategic Shifts

Alibaba's recent financial performance has been a mixed bag, with a notable rise in revenue but a substantial decline in net income, prompting investor concern. In its fourth-quarter results for 2024, Alibaba reported a 7% increase in revenue year-over-year, reaching RMB 221.874 billion (approximately $30.7 billion). However, its net income took a significant hit, dropping 86% to RMB 3.27 billion (around $453 million), according to Nasdaq.

The growth slowdown in Alibaba's e-commerce platforms, Taobao and Tmall, is a key concern. Despite a double-digit increase in gross merchandise volume, customer management revenue merely edged up by 5%. This stagnation is attributed to heightened competition from rivals like Pinduoduo and Douyin, which have been gaining market share through aggressive discount strategies, notes Business Standard.

Alibaba is increasingly turning to its cloud and AI sectors as new growth avenues. Although cloud revenue increased by 13% to RMB 31.74 billion (approximately $4.35 billion), overall growth was modest at 3% year-over-year. Notably, AI product revenue continues to surge with triple-digit growth for the sixth straight quarter. The company has announced plans for substantial investments in cloud and AI infrastructure over the next three years, aiming to strengthen its competitive position, as reported by Alibaba Group.

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