Alibaba’s net profit increased 3.4 times year-on-year from October to December

The financial report for the 10th to December period of fiscal year 2024 released by Alibaba Group, China’s largest e-commerce company, on February 20 showed that net profit reached 48.9 billion yuan, 3.4 times that of the same period last year. The earnings of the main e-commerce business and cloud business have improved, and the investment income calculated by equity method from its financial company Ant Group has also increased.

Sales increased by 8% year-on-year to 280.1 billion yuan. It exceeded the market expectations of LSEG statistics in the UK (279.6 billion yuan). In terms of sales of various businesses, China’s domestic retail business, led by the main business e-commerce, increased by 5% due to increased commission income from sellers. In addition, the overseas e-commerce business increased by 32%. Driven by artificial intelligence (AI)-related businesses, the cloud business grew by 13%.

In terms of adjusted EBITA (earnings before interest, taxes, depreciation and amortization) of various businesses, among the six businesses, three businesses, namely domestic retail business, cloud business and logistics business, achieved profitability. The domestic retail business, which accounts for most of the profits, increased by 2% year-on-year, and the cloud business increased by 33% year-on-year. The logistics business decreased by 76% year-on-year.

The investment income calculated by equity method from Ant Group, a subsidiary of the financial company, was 4.4 billion yuan. It was only 80 million yuan in the same period last year, a significant improvement. The impact of losses related to Gao Xin Retail, which operated large supermarkets in the same period last year, has also disappeared.

In the financial report release, Alibaba CEO Wu Yongming said that it will continue to implement the strategy of focusing on e-commerce and cloud computing, and continue to invest to promote long-term growth. In terms of cloud business, Alibaba recently opened a data center in Mexico and began to explore the Central and South American market.

While focusing on e-commerce and cloud business, Alibaba is also promoting business adjustments such as compressing physical store business.