Alibaba Group Holding Ltd Q3 Revenue Falls Short Of Estimates

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Revenue from China commerce business rose 32% YoY to $3.42 billion

Alibaba has released its December quarter results. The Chinese e-commerce giant’s revenue fell short of Wall Street estimates, sending the stock down by as much as 8.5% to $90.20 in pre-market trading Thursday. Alibaba reported revenue of $4.21 billion, up 40% from the same quarter last year. Despite an impressive growth, its revenue missed the consensus estimate of $4.45 billion.

Alibaba’s GMV jumps to $127 billion

The Hangzhou-based company’s earnings fell 28% to $964 million or 37 cents a share. Excluding one-time charges, its earnings were up 13% YoY to 81 cents per share. Analysts polled by Thomson Reuters had called for 75 cents in EPS. Alibaba’s revenue growth was driven by more users buying items through their mobile devices.

For the December quarter, mobile accounted for 42% of the company’s total transactions, up from 36% in September quarter and 20% in the same quarter last year. The number of active mobile users surged from 217 million in September quarter to 265 million at the end of December. The Jack Ma-led company said that gross merchandise volume for the quarter rose 49% YoY to 787 billion yuan ($127 billion).

Alibaba’s mobile revenue jumps 448%

The company’s EBITDA margins improved significantly during the third-quarter. Alibaba reported EBITDA margin of 58%, up from 50.5% in the September quarter. Revenue from China commerce business rose 32% YoY to $3.42 billion, driven by growth in online marketing services and commission revenue. Mobile revenue skyrocketed 448% YoY to $1.03 billion in the quarter ended December. The company saw an increase in the mobile monetization rate.

Recently, Alibaba CEO Jack Ma said that the company was “still a baby” and will see significant growth going forward. Yesterday, Chinese regulator State Administration of Industry and Commerce (SAIC) criticized Alibaba for failing to crack down on the sale of counterfeit goods, employees taking bribes, and other illegal activities on is platforms.

Alibaba shares were down 6.04% to $92.52 in pre-market trading Thursday. Its stock had rallied more than 40% since Alibaba’s September IPO until Wednesday.

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