Alibaba’s surging e-commerce sales boost June quarterly earnings

Alibaba Group’s e-commerce business’ profit increase contributed to a blockbuster quarter for China’s top online player.



For the period ended June 30, China’s largest online retailer reported total revenue of 50.1 billion RMB ($7.1 billion U.S.), an increase of 56% year-over-year. This beat analysts' estimates of 47.7 billion RMB, according to Thomson Reuters. Net income was 14 billion RMB $2 billion U.S.).



A majority of this increase stemmed from Alibaba’s core commerce, which increased 58% year-over-year to 43 billion RMB ($6.4 billion U.S.). Sales across its e-commerce platforms made up 86% of revenue in the three months to June 30, up from 73% a year prior, according to Reuters.



The company’s annual active consumers (formerly defined as annual active buyers) on its Chinese retail marketplaces reached 466 million RMB, an increase of 12 million from the 12-month period ended March 31. Mobile active users (MAUs) on these retail marketplaces reached 529 million in June, an increase of 22 million over March 2017.



“Alibaba had a strong start to fiscal 2018, reflecting the strength and diversity of our businesses and the value we bring to customers on our platforms. Our technology is driving significant growth across our business and strengthening our position beyond core commerce,” said Daniel Zhang, CEO of Alibaba Group. “We are excited about the future as we continue to innovate and drive synergies among the businesses throughout the Alibaba ecosystem.”



Additional revenue drivers included gains in its cloud computing division which had a 96% year-over-year increase in revenue, pushing earnings to 2.4 billion ($359 million U.S.). Meanwhile, revenue from digital media and entertainment increased 30% year-over-year to 4.1 billion ($602 million U.S.).



We delivered excellent results in the first quarter, with robust revenue growth of 56%. The significant growth in customer management revenue represents the differentiated business value we provide to our customers,” said Maggie Wu, CFO of Alibaba Group. “It is our intention to continue investing in long-term growth opportunities, some of which are already delivering significant value to customers and investors.”