Online retail giant Alibaba has lowered its second quarter forecast because of slower Chinese economic growth, which in turn influenced Chinese consumer spending.
Slower AliExpress growth
Alibaba said its "gross merchandise value", which is the total sum of sold goods before expenses, will not grow as fast as expected. According to the company, growth will be several % lower than previously anticipated.
The Chinese online giant also expects AliExpress' growth to slow down to the lower end of the double-digit range. Unfavourable exchange rates in countries like Russia and Brazil were to blame. Alibaba's international turnover has suffered because of AliExpress' slower growth as it is mostly dependent on the online marketplace.
Despite the lower forecast and slower growth for the Chinese economy, its online trade nevertheless grows a lot. In the first quarter of its fiscal year, Alibaba still managed a 28 % growth compared to the year before. However, in the first quarter of 2014, the company managed a 45 % growth.