Alibaba's stock falls as e-commerce pressure sparks revenue miss

By Emily Bary

Profit for the latest quarter exceeded expectations

Alibaba Group Holding Ltd. shares are heading lower in Thursday's premarket action after the Chinese e-commerce giant posted a revenue miss driven by a shortfall in its big e-commerce marketplaces.

The company posted fiscal first-quarter net income of 24.27 billion renminbi ($3.3 billion), or 9.89 renminbi per American depositary share, compared with 34.33 billion renminbi, or 13.30 renminbi a share, in the year-earlier period.

On an adjusted basis, Alibaba (BABA) (HK:9988) earned 16.44 renminbi a share, whereas analysts tracked by FactSet were modeling 15.00 renminbi.

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Alibaba's revenue rose to 243.24 billion renminbi from 234.16 billion a year prior, while the FactSet consensus was for 248.32 billion renminbi.

U.S.listed shares of Alibaba are down more than 4% in morning action.

The company hauled in 113.37 billion renminbi from its Taobao and Tmall e-commerce businesses, below the 121.70 billion renminbi that analysts were expecting and down from the 114.95 billion renminbi seen a year earlier.

"Our focus on enhancing user experience by offering quality products at attractive prices with great service led to stabilizing market share of Taobao and Tmall Group," Chief Executive Eddie Wu said in a press release.

Alibaba's cloud intelligence unit saw a 6% growth in revenue to 26.55 billion renminbi, while analysts were looking for 26.07 billion renminbi.

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The company called out "double-digit public cloud growth and increasing adoption of AI-related products" in its release. Product revenue related to artificial intelligence was up by a triple-digit percentage relative to a year earlier, Alibaba said, and the company intends to keep investing as it looks to hold onto its market leadership.

Alibaba made $5.8 billion worth of share repurchases in the June quarter.

-Emily Bary

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08-15-24 0730ET

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