Earnings

Alibaba Shares Down On Earnings Miss

Investors weren’t too keen on Alibaba’s latest earnings, pushing shares downward as a result.

Alibaba reported EPS of $0.63 for its fourth fiscal quarter, below expectations of $0.66.

This miss brought Alibaba (BABA) shares down the morning of the release. Pre-market trading saw value trending toward a loss of 3 percent. Upon Thursday’s opening bell, Alibaba opened down 3.02 percent, trading at $117.07. However, BABA stocks recovered later in the day.

The strength in the Chinese eCommerce giant’s report lay elsewhere.

For the quarter that ended March 31, Alibaba reported total revenue up 60 percent year over year to 38.58 billion yuan ($5.6 billion), well above analysts’ forecast of 36 billion yuan. This rate of growth, noted CEO Daniel Zhang, was the highest the company has achieved since its IPO.

Revenue from the company’s core eCommerce business was up 47 percent to 31.57 billion yuan ($4.58 billion). In fact, revenue was well up across all of Alibaba’s segments — cloud computing brought in $314 million, up 103 percent, and digital media and entertainment raked in $571 million, up a full 234 percent. Innovation initiatives and other revenue hit $133 million for the quarter, up 88 percent.

While cloud computing and digital entertainment division revenues have surged, they’ve yet to turn a profit.

“Our core commerce segment continued its significant growth and strong cash flow at large scale, enabling our aggressive investment in cloud computing, digital media and entertainment to drive the digital transformation of the economy and high-quality consumption across China,” Zhang said.

Alibaba also saw user numbers up for the quarter, with annual active buyers across Alibaba’s Chinese retail marketplaces hitting 454 million. Mobile monthly active users hit over 507 million.

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