Alibaba says profit up 132% in 'outstanding' quarter amid soaring sales

Joanna Estrada
November 2, 2017

Looking ahead, the company increased its 2018 fiscal year revenue growth guidance.

Maggie Wu, Alibaba's CFO, said the group generated approximately 3.4 billion USA dollars in non-GAAP free cash flow during the quarter, "which enables us to invest in our future growth areas of core commerce, including logistics, cloud computing, digital entertainment and other innovation initiatives".

While Alibaba has both online and brick-and-mortar stores, it is the brand's e-commerce roots that are proving particularly profitable, bringing in 46.43 million yuan ($6.98 million).

The firm's shares - which have more than doubled in value this year - were up 3.1% in pre-market trading and were set to open at a record high.

China's biggest e-commerce company said net profit for the three months ending September 30 reached 17.67 billion yuan, (USD 2.67 billion), up from 7.62 billion yuan in the same period of 2016.

Adjusted earnings after excluding stock-based compensation and one-off charges rose 71 percent to 22 billion yuan.

Alibaba invested 25.7 billion yuan in the quarter versus 5.7 billion in the same quarter a year earlier. Revenue again almost double in the last quarter to reach RMB 3 billion ($447 million), up from RMB 2.4 billion in the previous quarter when it hit one million customers for the first time. That was better than the mean forecast of 52.2 billion yuan, according to analysts polled by Thomson Reuters.

"This quarter we delivered excellent results, with overall revenue growth of 61 per cent demonstrating the robust momentum in our core commerce business and across the Alibaba economy".

Revenue from Alibaba's fast-growing cloud computing business was 3.0 billion yuan, up 99 percent but slowing from a 130 percent rise a year earlier. Revenue from digital media and entertainment increased 33 percent to 4.8 billion yuan, and revenue from innovation initiatives and others increased 27 percent to 887 million yuan.

The company was now raising its growth forecast for revenues in the full fiscal year to 49-53 per cent, compared to a previous expectation of 45-49 per cent growth, citing the expected beneficial impact of its plan to take control of logistics company Cainiao.

Other reports by Click Lancashire

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