AFP – Chinese e-commerce giant Alibaba reported a 29-per-cent fall in quarterly profit yesterday as it battles sluggish consumption during an economic slowdown.
Net income attributable to shareholders came in at CNY24.3 billion (USD3.3 billion) in the quarter ending June 30, Alibaba said in a corporate filing, down from CNY34.3 billion in the same period in 2023.
Alibaba runs some of China’s most popular e-commerce apps and its performance is widely considered an indicator of broader economic trends.
China released another series of disappointing indicators yesterday, despite recent government measures to boost growth.
Alibaba’s revenue for the first quarter was CNY243.2 billion, up four per cent from the previous year.
“In this quarter, we continue to invest for growth in our core businesses while reducing losses in other business units through operating efficiency,” chief financial officer Toby Xu said in the filing.
Alibaba made USD5.8 billion of share repurchases in the first quarter, part of an effort to reassure investors amid narrowing profits.
Its results contrasted starkly with rival shopping app operator JD.com, which announced a whopping 92.1 per cent increase in profit for the past quarter.
Yesterday’s results come at a time when Alibaba is increasingly being challenged by Pinduoduo, another shopping app whose parent company owns internationally popular budget shopping app Temu.
As sluggish growth hits consumers’ wallets, more shoppers are turning to generally lower-priced items on the Pinduoduo app rather than Alibaba’s Taobao and Tmall platforms.
