Alibaba Group Holding Ltd. BABA 4.28% said an extended shopping event in November helped boost its profit and sales for the last three months of 2020, a period that also saw the technology giant and its founder attracting scrutiny from Chinese regulators.
The Chinese e-commerce giant’s annual 11.11 Global Shopping Festival, normally a one-day affair, ran from Nov. 1 to Nov. 11. That generated 498.2 billion yuan, equivalent to $74.1 billion, in gross merchandise value during those 11 days, excluding unpaid orders, up 26% from the same time frame in 2019, the company said Tuesday.
Sales for the fiscal third quarter rose about 37% to 221.08 billion yuan, ahead of the 214.29 billion yuan analysts polled by FactSet had expected.
The company’s cloud-computing revenue grew 50% to 16.12 billion yuan, a gain the company attributed to customers in the internet, retail and public sectors. Alibaba said it processed 583,000 orders per second during the 11.11 event.
The company’s results come after the suspension of a blockbuster initial public offering of Alibaba affiliate Ant Group Co. in November, a sudden halt to what would have been the world’s largest IPO. The move delivered an extraordinary rebuke to Jack Ma, the billionaire co-founder of both Alibaba and Ant who drew the ire of Chinese regulators when he gave a speech at a financial forum in Shanghai in October. Chinese authorities have launched a probe into Alibaba for alleged anticompetitive behavior on its e-commerce platform.
Alibaba on Tuesday said it would continue to communicate with China’s State Administration for Market Regulation on compliance with regulatory requirements.
The Hangzhou, China-based company also attributed its strong quarter to China’s recovery from the effects of the Covid-19 pandemic. “Thanks to the rapid recovery of China’s economy, Alibaba had another very healthy quarter,” Chairman and Chief Executive Daniel Zhang said.
Alibaba posted net income attributable to ordinary shareholders of 79.43 billion yuan, compared with 52.31 billion yuan in the comparable quarter last year. Earnings were 28.85 per American depositary share, compared with 19.55 yuan per ADS in the year-ago period. Excluding special items, earnings were 22.03 yuan per ADS, beating the 20.71 yuan per ADS analysts were expecting.
Core commerce sales at the company, which runs China’s two most popular e-commerce platforms, rose 38% to 195.54 billion yuan.
Write to Dave Sebastian at [email protected]
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