Ant Group reportedly saw a 92% decline in its quarterly profit.
The FinTech company continues to face challenges in reviving its business amid an economic downturn and regulatory scrutiny, Bloomberg reported Wednesday (Feb. 7).
Ant Group’s profit contributed 80 million yuan (about $11 million) to Alibaba Group, which translates to an estimated 240 million yuan (about $34 million) in profit for the FinTech company’s September quarter, according to the report.
The decrease in profits for Ant Group is primarily attributed to an increase in net investment loss, while the operating profit remained largely flat, the report said.
Ant Group is awaiting a financial holding company license, which would make possible a revival of its initial public offering (IPO), per the report.
Ant Group has been at the heart of Beijing’s crackdown on Alibaba and was fined over $1 billion in July, according to the report.
Last year, Ant Group proposed a buyback plan to reduce investors’ exposure to the firm, the report said. This buyback plan resulted in a decrease in the company’s valuation.
To seek growth opportunities, Ant Group is using its payments network, Alipay, to collaborate with digital wallets across Asia for transactions outside their home markets, per the report. The company has expanded its services into a foundation for cross-border payments called Alipay+.
Additionally, Ant Group is preparing to break off its international business, along with blockchain and database management services, according to the report.
In November, Ant Group received approval from the Chinese government to roll out products powered by its large language model, Bailing, to the public, the report said. The move allows the company to use the popularity of Alipay to gain more data and insight into user habits.
In September, Ant unveiled two applications, Zhixiaobao and Zhixiaozhu, which serve as customer question-answering and financial professional assistant tools, respectively, per the report.
When announcing the launch of its financial large language model, Ant Group said it intends to use the technology across all digital financial services in collaboration with institutions in the Chinese market.