Alibaba collapses on the stock market, loses more than 10% and drags down the entire Hong Kong list: the Chinese e-commerce giant expects sales to grow by 20-23% at the end of the year, but warns of “risks and uncertainties Which could harm your business. Also because the Chinese giant’s profits are weighed down by the regulatory tightening in China that is shaking the tech giants.
Long considered a model of success for Chinese companies, Alibaba was effectively clipped a year ago by the government that stopped the giant IPO of its subsidiary Ant Group, 48 hours before its debut: a shutdown that cost group of 27.4 billion euros of lost revenues. Then last spring the group was fined 2.3 billion for hindering competition.
In September, on the other hand, a tight regulation was taken on the big tech companies. Enough for Alibaba to announce an 81% drop in net profit yesterday in the second quarter of its fiscal year. The group recorded a profit of 5.37 billion yuan (741.3 million euros), compared to 28.7 billion yuan in the same period of 2020. The turnover instead increased by 29% in one year, to 155 billion yuan (21.4 billion euros).
“In this quarter, Alibaba continued to invest firmly in our three strategic pillars of domestic consumption, globalization and cloud computing to lay a solid foundation for our long-term goal of sustainable growth in the future,” said Daniel Zhang. president and chief executive officer of the group explaining that “our annual active consumers across the ecosystem have reached approximately 1.24 billion, with a quarterly net increase of 62 million consumers and we are on track to achieve our long-term goal. to serve two billion consumers globally ”.
For Maggie Wu, chief financial officer of Alibaba Group, “We have seen revenue growth of 29% year-on-year, driven by the performance of our diversified businesses. During this quarter, our continued investments in key strategic areas have led to robust growth for these young companies ”.
However, the group cut its year-end growth estimates: revenue growth was revised from 28% to 20-23%.