Despite softer demand and supply chain and logistics disruptions, Alibaba Group reported revenue and profits for Q3 that exceeded Wall Street estimates. Revenues increased by 2 percent to 247.8 billion yuan renminbi (€34.1b) from RMB 242.6 billion for the period ending Dec. 31. The Chinese e-commerce behemoth said in a statement, said it expects a “continued recovery in consumer sentiment and economic activity.”
Aided by an 89 percent decline in goodwill, Q3 operating income soared to RMB 35.03 billion (€4.8b) from RMB 7.07 billion. The resulting operating margin was 14.1 percent versus 2.9 percent in the year-ago period. Net income climbed by 69 percent to RMB 46.9 billion (€6.5b) from RMB 27.8 billion.
China sales declined by 1 percent to RMB 170 billion (€23.4b) as international revenues increased by 8 percent to RMB 19.5 billion (€2.7b). In aggregate, the Taobao and Tmall businesses realized a mid-single-digit drop in quarterly sales due to soft consumer demand, ongoing competition, and a surge in Covid-19 cases in China. The demand for fashion and accessories was weakened but higher demand for healthcare, pet care and fresh produce products. Cloud sales rose 8 percent to RMB 20.2 billion (€2.8b).
