Signage at the Alibaba Group Holding Ltd. headquarters in Hangzhou, China, on Friday, Aug. 2, 2024.
Qilai Shen | Bloomberg | Getty Images
Alibaba missed top and bottom line expectations for the June quarter of 2024 as it continues to face headwinds in its core e-commerce business amid rising competition and a cautious Chinese consumer.
Shares of Alibaba fell around 3.49% at 06:58 a.m. in premarket trade in the U.S.
Here’s how Alibaba did in the June quarter versus LSEG estimates:
- Revenue: 243.24 billion Chinese yuan ($34.01billion) versus 249.05 billion yuan expected.
- Net income: 24.27 billion yuan versus 26.91 billion yuan expected.
Revenue was up 4% year-on-year, while net income dropped 29% year-on-year. Alibaba said the net income fall was “primarily due to a decrease in income from operations” and “increase in impairment” from its investments.
Alibaba has been looking to reignite growth after a tumultuous 2023, when it carried out its largest-ever corporate structure overhaul. This was followed by high-profile management changes, with Eddie Wu taking over the reins as chief executive in September.
The e-commerce giant has been grappling with a cautious Chinese consumer, along with increased competition from rivals such as JD.com and Temu owner PDD.
Since taking over the reins, Wu has been trying to get Alibaba’s core China e-commerce business back on a stable footing. It’s currently going through a transition phase where the company is planning to put more focus on third-party merchants selling via its platforms — Taobao and Tmall — in China, while reducing reliance on its direct sales business.
Wu has previously said the company intends to release new monetization features for its e-commerce platforms that should return the Taobao and Tmall business back to growth toward the latter half of 2025.
In the June quarter, sales from the Taobao and Tmall group, which represents Alibaba’s China e-commerce business, fell 1% year-on-year to 113.37 billion yuan.
Meanwhile, Alibaba’s overseas online shopping businesses, such as Lazada and Aliexpress, continue to be a bright spot, with sales in the international e-commerce division up 32% year-on-year.
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