Alibaba Earnings Report Expected To Show Big Jump In Revenue

Alibaba Group (BABA) is expected to show its best revenue growth in three years when the China e-commerce giant reports earnings results for its fiscal fourth quarter. The Alibaba earnings report arrives early Thursday. Alibaba stock was down in recent action.


Analysts expect it to report that revenue soared 72% to $27.8 billion for the period ended March 31. In addition to being its best growth in three years, that would also be Alibaba’s fourth straight quarter of accelerating revenue growth.

The consensus among Wall Street analysts is for Alibaba to report $1.79 earnings per share, up 38%, according to FactSet.

Alibaba stock has been on a downtrend since November, even though it continues to deliver strong earnings and sales growth. Shares dipped 0.7%, closing at 219.90 on the stock market today

Alibaba Earnings Pressured By Spending

Analysts expect pressure on profits due to higher spending on growth initiatives. That’s especially in lower-tier cities and in segments with lower online penetration.

Last month, Alibaba paid a $2.8 billion antitrust fine by Chinese regulators for abusing its market dominance over merchants and rivals. BABA stock spiked 9% in heavy volume, largely due to relief that the penalties weren’t worse.

Fears over policy tightening and lofty valuations have pummeled many China technology stocks. Adding to the pressure are worries over Sino-U.S. trade relations.

Alibaba stock sank in early November. That came after Shanghai exchange officials suspended the $34.5 billion spinoff of Ant Group, the fintech arm of Alibaba.

Shanghai and Hong Kong exchange officials suspended the initial public offering due to the company’s inability to fulfill conditions amid changes in the regulatory environment.

China’s List Of Big Internet Companies

Alibaba is among the most dominant internet companies in China. Rivals include (JD), Tencent Holdings (TCEHY), Baidu (BIDU), Pinduoduo (PDD) and Vipshop (VIPS).

Alibaba is the largest e-commerce company in China in terms of gross merchandise volume. It also operates a fast-growing cloud computing unit. Other business units include digital media, entertainment, retail operations and a grocery business.

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Please follow Brian Deagon on Twitter at @IBD_BDeagon for more on tech stocks, analysis and financial markets. 


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