Alibaba adjusted net profit plummets 99.7pc to 86m yuan

Alibaba (9988) saw its adjusted net profit for the fourth quarter ending in March plummet 99.7 percent year-on-year to 86 million yuan (HK$99.2 million) – far below the market estimate of 14.4 billion yuan – dragged down by surging costs due to quick commerce business expansion, as well as the increase in artificial intelligence spending.

Meanwhile, China's largest e-commerce company's adjusted net profit for the fiscal year ended in March also dropped 62 percent to 60.66 billion yuan, while net profit went down 18.2 percent to 105.9 billion yuan. 

However, its quarterly revenue went up 3 percent to 243.3 billion yuan, close to the market expectation of 246.5 billion yuan. 

Its US-listed shares once fell more than 3 percent in the pre-trading market.

Like other tech giants, Alibaba has benefited from soaring business demand for AI. Revenue from Alibaba's Cloud Intelligence Group surged 38 percent to 41.63 billion yuan during the quarter, in line with estimates. 

"Our strategic investments continued to translate into business growth. Cloud Intelligence group's revenue continued to accelerate, with AI-related product revenue achieving triple-digit growth for the eleventh consecutive quarter," said chief executive Eddie Wu Yongming.

Alibaba reported revenue of 122.22 billion yuan in its China e-commerce business, which includes the highly competitive quick commerce segment, topping estimates of 119.85 billion yuan.

Besides, Ant Group posted a 78.7 percent fall in net profit to 1.15 billion yuan in the three months to December 31, according to Reuters calculations based on Alibaba's earnings released yesterday.

Staff reporter and Reuters

 

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