News this week: Yesterday, Alibaba Group
announced its financial results for the quarter ended 31st December
2014. Revenues in the period were US$4.2 billion, a year-on-year 40% growth,
but this missed the average analyst estimate of US$4.4 billion. In addition, net
income dropped 28% to US$964 million, and diluted earnings per share were RMB
2.29 (US$0.37).
Revenues from the
China commerce retail business in the three-month period were US$3.4 billion,
up 32% year-on-year, due to growth in commission revenue and online marketing
services revenue. Mobile revenues from the China commerce retail business grew
surprisingly by 448%, amounting at US$1.04 billion, caused by a greater
proportion of GMV generated on mobile devices and an increase in the mobile
monetization rate.
Separately, on
Wednesday, Beijing released a report criticising Alibaba for the number of
counterfeit goods available on its e-commerce platforms. The State
Administration of Industry and Commerce (SAIC) reportedly wrote the sternly
worded report in July, but held back releasing the report until after Alibaba’s
September IPO.
Alibaba’s stock
dropped 8.8% to close at a three month low of US$89.81 on Thursday. The
controversy may also have implications for Yahoo which announced this week it
has plans to spin off its US$40 billion Alibaba shares into a new company –
primarily to avoid paying taxes on the eventual sale of those shares.
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