Ali Baba (Baba) reported quarterly results early Thursday that beat expectations in profit and loss, while pointing to improved business conditions in June. BABA’s stock jumped.
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The China-based e-commerce giant reported adjusted earnings of $1.75 per US deposit share on revenue of $30.7 billion for the June quarter. Analysts expected Alibaba to report earnings of $1.58 per share on revenue of $30.1 billion, according to FactSet.
Alibaba shares jumped 2.3% to 97.95 during afternoon trading in stock market today. Besides BABA shares, other China issues also jumped.
JD.com (Dinar) jumped 3.8% to 63.50. Baidu (Baidu) rose 2.5% to 140.25. And the Bindudu (PDD) rose 4.3% to 51.75.
Meanwhile, Alibaba showed its first quarterly revenue decline as expected, down slightly by 0.09% from a year earlier. But this is a departure from the consistent double-digit gains in recent years.
Alibaba has blamed the Covid-19 outbreak in China for lower revenue. Moreover, the pandemic hit the local e-commerce business with supply chain and logistics disruptions in April and May.
BABA stock: signs of recovery in June
CEO Daniel Chang said in written notes with Alibaba earnings release. “We are confident in our long-term growth prospects due to our high-quality customer base and the flexibility of our diversified business model that caters to the different demands of our customers.”
Increased regulatory scrutiny has affected shares of BABA and others over the past two years. Also, along with the stringent regulatory environment, Chinese stocks are also dealing with a slowing economy, the Covid lockdown, supply chain issues and inflation.
“Despite the challenges posed by the resurgence of Covid-19, we have delivered stable revenue performance,” Alibaba CFO Toby Xu said in written remarks.
Much like Alibaba’s business in China Amazon‘s (AMZNUS operations. Alibaba’s cloud computing business is showing solid growth, just like Amazon’s thriving web services business.
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