Alibaba’s share price gains 1.58% after it posted a 51% increase in Q4 sales

Shares of the group gained US$2.76 to close the day’s trading at US$177.60 following the earnings announcement.

Alibaba Group on Wednesday reported a strong top-line for the fiscal fourth quarter, beating estimates. Shares of the group gained 1.58% or US$2.76 to close the day’s trading at US$177.60 following the earnings announcement.

The group said revenue for the fourth quarter surged 51% year-on-year to reach 93.5 billion yuan, beating the 91.58 billion yuan estimate analysts had expected, based on IBES data from Refinitiv.

For the full year, Alibaba said its revenue was at 376.84 billion yuan, up 39% after excluding the boost from newly acquired businesses, such as food delivery firm ele.me.

Alibaba share price

Alibaba’s shares rose 1.7% to US$177.55 on the New York Stock Exchange moments after its fourth-quarter results release. Its shares peaked US$179.88 at around 2.50pm New York time before settling the day’s trading at US$177.60, at a gain of 1.58% or US$2.76.

Year-to-date, Alibaba shares have risen by around 30%.

Alibaba earnings report highlights

Alibaba said it expects revenue for the full fiscal year ending in March 2020 to top 500 billion yuan, which will be a 33% year-on-year increase.

Net income attributable to ordinary shareholders rose to 25.83 billion yuan, from 7.56 billion yuan in the same period a year earlier.

The group said sales came mainly through selling advertising and promotional services to third-party merchants that post products on two of its e-commerce websites, Taobao and Tmall. The firm’s focus on customers in more rural areas has paid off, as over the past year, more than 70% of the increase in annual active customers came from less developed cities in China.

Alibaba said its mobile monthly users reached 721 million in March, an increase of 22 million in three months and 104 million shoppers compared to a year ago.

The group which has invested heavily in cloud computing, saw revenue for this business segment rise by 76% in the fourth quarter.

Tapped by chairman Jack Ma to be his successor in September 2018, chief executive Daniel Zhang will formally replace Mr Ma later this year. Mr Zhang is the mastermind behind the world’s largest retail event Singles’ Day, which is held annually on November 11.

Read more about Alibaba shaking up the banking industry

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