Chinese retail group Alibaba has published better-than-expected quarterly results: turnover went through the roof, but its profit is under pressure because of increased investments.
In 2018’s first quarter (and the final one in the company’s fiscal year), Alibaba Group’s turnover grew 61 % to 9.9 billion dollars (8.3 billion euro). Its profit dropped a third to 2.2 billion dollars (1.8 billion euro), because of long-term growth investments, said CEO Daniel Zhang in the press release.
“With the continuing roll out of our New Retail strategy, our e-commerce platform is developing into the leading retail infrastructure of China. During the past year we also doubled down on technology development, cloud computing, logistics, digital entertainment and local services so that we are in a position to capture consumption growth in China and other emerging markets.”
For its full fiscal year, Alibaba’s turnover grew 58 % to 39.9 billion dollars (almost 34 billion euro) and the group has forecast another 60 % growth for its next fiscal year. The company is also increasingly focused on offline retail (with chains like Hema, Tmall Supermart and Intime), has an Southeast Asian presence through Lazada and already has more than 552 million Chinese active users on its marketplaces.