Chinese e-commerce giant Alibaba saw its turnover grow by 41 % in the past quarter. Analysts are still worried, as this is the lowest turnover increase in three years' time.
40 % retail growth
In the past quarter, Alibaba managed to gain 41 % more turnover than the year before, totalling 117 billion yuan or 15.5 billion euros. There was growth in all departments of the retail and tech company, but cloud services performed best with an 84 % turnover increase. Alibaba currently holds half of the Chinese market in cloud services.
Retail turnover (from both online marketplaces and offline shops) grew by 40 %, but that growth should accelerate when Alibaba starts making full use of the new recommendation system and the updated search engine launched in the past quarter. Already, the new design has apparently led to increased customer involvement and conversion.
Remarkably, Alibaba still keeps pulling in new consumers: the monthly number of active mobile users in the home market grew by 33 million compared to the previous quarter. The e-commerce giant has reached about 699 million users that way. Growth mostly stems from smaller cities, where the company is betting both on simpler interfaces for new users and on new models to allow merchants and farmers in the country to sell across all of China.
Chinese economy is slowing down
Net profit grew 37 % to 33.1 billion yuan or nearly 4.4 billion euros: a pleasant surprise, as analysts were expecting a profit of 'just' 22.1 billion yuan. Alibaba's quarterly figures are a welcome bit of good news after more than twenty Chinese companies were forced to issue profit warnings.
Still, even Alibaba can not escape the hovering dark cloud: the turnover increase has been the lowest since 2016, bringing an end to a spectacular series of ten quarters in a row with over 50 % growth. Analysts have observed that the Chinese economy is slowing down: growth is less vigorous and the impact of the Chinese-American trade war is becoming palpable.