Alibaba reports slowest ever revenue growth for March quarter on the back of slowing economy amid pandemic lockdowns

E-commerce giant Alibaba Group Holding reported a 9 per cent increase in revenue for the March quarter, the slowest pace on record, on the back of a slowing economy in China amid ongoing pandemic lockdowns.

The Hangzhou-based company, which owns the South China Morning Post, said its revenue reached 204.05 billion yuan (US$32.19 billion) for the quarter, beating the expected 200.6 billion yuan, according to estimates by 34 analysts surveyed by Bloomberg. The increase was primarily driven by revenue growth in domestic commerce, local consumer service and cloud segments.

Alibaba’s cloud business, which the company is betting on as a major new source of revenue and profits, reported a full-year profit of 1.1 billion yuan though, marking the first time that the company has turned a profit from the business.

The net loss widened to 16.24 billion yuan, compared with 5.48 billion yuan a year earlier. This was worse than the average analyst estimate for net income of 10.5 billion yuan. The drop was attributed to equity investments in publicly-traded companies, internal investments in new businesses such as Taocaicai and Taobao Deals, and the continued impact of Covid-19.

Adjusted profit fell 24 per cent year on year to 20 billion yuan during the quarter.

Daniel Zhang Yong, chairman and chief executive of Alibaba, noted that the company “saw a low single-digit decline in revenue growth in April” compared to the same period last year, as the Omicron outbreak dragged business performance.