Chinese internet heavyweight Alibaba ADR (NYSE:BABA) recently reported below-expected quarterly revenue and slow active user growth.
A year-on-year increase of 34% was recorded in the company’s revenue for the June quarter. However, analysts’ expectations of RMB209.16 billion could not be met with the company managing to secure just RMB205 .74 billion ($31.86 billion).
The chasm would be much greater if Sun Art, a supermarket chain, hadn’t been bought by Alibaba last year. Without the acquisition, the company’s revenue would have only risen 22% to RMB187.30 billion ($29 billion).
In June, Alibaba’s Chinese marketplaces had 939 million monthly active users, up 14 million from March. The March number was 23 million more than December’s, indicating a slowdown in growth as consumers return to normalcy after a tough pandemic period.
Aside from Sun Art, Alibaba had other revenue drivers; Cloud computing and commerce. More individuals utilizing the site to buy groceries and gadgets helped the company’s commerce sector. Search monetization and recommendation feeds also allowed the business to yield more revenue.
Adjusted revenues were RMB16.6 per diluted ADS, more than the projected RMB14.37.