Alibaba’s quarterly profit fell by 69% – Kommersant
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In the third quarter ended December, Chinese online retailer Alibaba’s net profit fell by 69%, to $2 billion. The company’s revenue increased by 5%, amounting to $36.7 billion. Revenue from the main divisions of the holding – marketplaces Taobao and Tmall Group – increased only by 2%, to $18.2 billion. These results were worse than expected – Alibaba shares are down almost 6% today. As part of the publication of the financial statements, the company also announced the expansion of the share repurchase program for the next three years – by $25 billion, to $35.3 billion.
2023 has been a challenging year for Alibaba. In March was announced on a large-scale restructuring of the company, within the framework of which it should be divided into six independent business groups, each of which will hold an IPO. Later, some changes had to be made to the restructuring plan – for example, Alibaba refused from spinning off the cloud business into a separate company.
The weak quarterly results are due, among other things, to the fact that the Chinese economy is recovering more slowly than previously expected. The quarterly report included costs of $3 billion due to severe deterioration in the performance of some assets, such as the video service Youku and the Sun Art supermarket chain.
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