The Wall Street Journal (WSJ), citing Ant, reported that the company had a pre-tax profit of 5.3 billion yuan for the same quarter a year ago. It marked the third time that Ant had a quarterly loss since its unit’s result was disclosed by Alibaba in the early part of 2014. Alibaba blamed the loss on increased investments to capture growth. The WSJ quoted Alibaba, saying it “stepped up its investment to acquire more users and capture growth opportunities of the offline payment market,” which hurt results. The loss was also due in part to spending so as to expand the business internationally.
Ant operates Alipay, the digital payment service in a battle with Tencent‘s WeChat Pay for dominance in China. Alipay ended the September quarter with more than 700 million active users — that’s up from 520 million in January. WeChat Pay had more than 800 million users as of June. Earlier in 2018, Ant became the most valuable tech startup after raising $14 billion investors in China, the U.S. and overseas, giving it a value of $150 billion.
Investors were clearly optimistic about Ant’s future after watching it diversify into credit services, asset management and online banking since spinning off from Alibaba four years ago, when the Chinese eCommerce giant went public (Ant also owns the Alipay payment platform). Ant has additionally invested in several internet-based startups, such as the Chinese bike-sharing company Ofo, food delivery app operator Ele.me, and Indian payment company Paytm.
As Ant expands its footprint into wealth management, consumer lending and overseas markets, it has posted a 65 percent leap in profits this fiscal year. It posted 9.18 billion yuan in pre-tax profit in the fiscal year ending in March, Bloomberg reported. Oh, and it has 870 million annual active users globally.