Alibaba’s Earnings Revenue Forecast Grim

Alibaba Group Holding, the Chinese eCommerce player, has some rough days in store.

[bctt tweet=”Rough days in store for Alibaba?”]

As Reuters reported Monday (Jan. 25), Wall Street analyst consensus forecasts for Alibaba for the quarter that ended in December have the company showing top line growth of 26.6 percent. That’s not exactly a poor showing, in terms of absolute growth, but it should be noted that this is the slowest rate seen in all of the company’s three-and-a-half-year reported history.

The consensus numbers come through a poll of more than two dozen analysts via Thomson Reuters. The number is nearly half the rate expected over the same period for arch eCommerce rival JD.com, at 47 percent to 51 percent. The latter firm has posted gross merchandise volume up 82 percent in the first nine months of the year, a league better than the 34 percent seen through the same period for Alibaba. The key, says Reuters, has been that JD.com has been putting emphasis on grabbing affluent shoppers in China’s urban centers, which has helped the company buck the slowdown seen in the Chinese economy at large.

Now, Alibaba has been looking to embrace large cities too, with forays into Beijing and Shanghai, among other places. That would be a departure from its longstanding movement into rural areas.

In the meantime, said Reuters, moving into cities may be “a tough ask” for the company — JD.com has already “carved out its own space” and has been banking on quick delivery times and quality assurance. Alibaba, for its part, appointed a new executive to spearhead anti-counterfeiting efforts, while managing to sidestep being named last month to a blacklist formulated in the United States of sites that have facilitated sales of various fake goods, according to the Reuters report.