Alibaba Group sign is seen on the World Artificial Intelligence Conference (WAIC) in Shanghai, China July 6, 2023.
Aly Song | Reuters
Chinese e-commerce giant Alibaba on Thursday said revenue grew by 14% 12 months on 12 months within the quarter ended June 30. That is the largest annual increase in sales for the reason that September 2021 quarter, in keeping with Refinitiv data.
The corporate’s U.S.-traded shares rose by 4.5% in premarket trading.
Here’s how Alibaba did within the June quarter versus Refinitiv consensus estimates:
- Revenue: 234.16 billion yuan ($32.29 billion) versus 224.92 billion yuan expected, up 14% 12 months on 12 months.
- Net income attributable to unusual shareholders: 34.33 billion yuan versus 28.66 billion yuan expected, up 51% 12 months on 12 months.
Alibaba’s important business, Taobao and Tmall Group, saw revenue rise 12% 12 months on 12 months to 114.95 billion yuan within the June quarter. The corporate noted that the Taobao app for online shopping saw each day lively users rise in June by 6.5% from a 12 months ago — and rose further to greater than 7% in July.
The corporate’s push into overseas markets also bore results, with revenue from international commerce retail surging by 60% 12 months on 12 months to 17.14 billion yuan within the June quarter.
That international demand also helped drive revenue for Alibaba’s Cainiao logistics business up by 34% to 23.16 billion yuan throughout the same period.
Alibaba’s cloud business reported revenue growth of 4% to 25.12 billion yuan. Those results were dragged down by a drop in revenue from top customers in addition to reduced need for distant work, streaming and education services within the wake of the coronavirus pandemic, the corporate said.
Investing more in AI
Nevertheless, Alibaba said it saw “strong demand” in its cloud business for training artificial intelligence models and related services.
“We consider the expansion opportunity driven by AI services have just begun. We consider the technology revolution built by AI not a brief term opportunity but the start of a recent era,” management said in a conference call with analysts Thursday.
They highlighted plans to take a position further in AI development and business opportunities.
“The Taobao app has the best potential to turn out to be a one stop smart portal for all times and consumption enabled by AI,” management said on the earnings call.
Because the craze over OpenAI’s ChatGPT within the last several months, many firms in China have rushed to announce their plans for similar products. ChatGPT is not officially available in China. Amid regulatory uncertainty, most similar AI products in China have focused on working with business partners moderately than offering public-facing chatbots.
In April, Alibaba launched its large language model (LLM) called Tongyi Qianwen. A LLM is a man-made intelligence model trained on huge amounts of knowledge. It’s also the idea for generative AI applications, similar to ChatGPT — which generate human-like responses to user prompts.
Alibaba announced earlier this month it would be opening a version of that model to third-party developers.
Alibaba restructure
Hangzhou-headquartered Alibaba has been undergoing major changes in recent months. In March, the corporate said it could split into six business groups, with some having the power to lift outside funding and go public. Alibaba has already said it plans to publicly list its cloud computing division.
Current CEO and Chairman Daniel Zhang might be stepping down in September, but remain head of Alibaba’s cloud computing business, because it pushes toward a public listing. Alibaba veteran Eddie Wu will succeed him as CEO, and Joe Tsai will take over as chairman, the corporate said in June.
“Alibaba delivered a solid quarter as we proceed to execute our Reorganization, which is starting to unleash recent energy across our businesses,” Zhang said in a release Thursday.