BEIJING: Alibaba Group Holding Ltd’s first quarter revenue beat analysts’ estimates as China’s biggest e-commerce company sold more advertising to merchants on its platforms.
Sales rose 39 percent to 24.2 billion yuan (US$3.72 billion) in the three months ended March, the company said yesterday.
That compares with the 23.2 billion yuan average of estimates compiled by Bloomberg.
Adjusted earnings-per-share were 3.02 yuan, compared with analyst projections for 3.52 yuan.
Alibaba’s platforms, which link buyers and sellers, hit a 3 trillion yuan milestone of goods sold as the company continues to expand even as the Chinese economy grows at its slowest pace in 25 years. The online emporium is making more from mobile advertisements, deepening its push into rural domestic regions and branching out overseas to boost transactions.
“The company was able to better monetize on selling advertisements to merchants,” Morningstar Investment Service analyst Marie Sun said before the earnings. “As the economy growth slows, it seems that merchants are more willing to place ads with bigger platforms like Alibaba that have a wider reach of customers.”
Net income rose to 5.3 billion yuan. That compares with the 5.4 billion yuan average of estimates.
On Wednesday, Alibaba shares slipped after short-seller and hedge fund manager Jim Chanos told CNBC he is betting against the firm because of a lack of cash flow.
Chanos also said he is still bearish on China.
