Chinese Alibaba has trumped analysts’ turnover and profit expectations with its first quarter results. Its profit even doubled compared to the year before.
Strong growth in international markets
The company’s total turnover jumped up 56 % to 50.18 billion yuan (6.4 billion euro), significantly better than what analysts had expected. Its first quarter profit also spiked, nearly doubling to 14 billion yuan (2.3 billion euro). The downside is that only its online sales generate a profit, because every other division is still onerous, mainly because of enormous marketing efforts.
Its eCommerce turnover grew 58 % compared to the year before and is the company’s prime source of income, representing 85 % of the group’s total turnover. The Cloud Computing division even published a 96 % growth, although the other divisions also experienced sizeable turnover growth.
Alibaba still generates 73 % of its turnover from its home territory, China, but its growth pace is significantly lower than in international markets. Alibaba’s turnover abroad grew 136 % compared to a “mere” 57 % in China. AliExpress and Lazada’s expansion were the main catalysts for turnover increases abroad.