SHANGHAI: China’s Alibaba Group Holding on Wednesday missed analysts’ estimates for third-quarter revenue, hurt by softness in the retail market and sagging economic recovery in the world’s second-largest economy.
U.S.-listed shares of Alibaba rose 1.3% in pre-market trading after the company flagged an increase of $25 billion to its share repurchase program through the end of March 2027.
Net income attributable to ordinary shareholders was 14.4 million yuan ($2 million) and net income was 10.7 million yuan ($1.51 million), a decrease of 77%.
The company said in December that Wu, group CEO since September, would directly oversee its domestic e-commerce arm, increasing his focus on the core divisions of the company as it combats slower earnings growth and rising competition.
“Our top priority is to reignite the growth of our core businesses, e-commerce and cloud computing,” Wu said on Wednesday.
Alibaba is under pressure as consumers in China, the world’s second-largest economy, have been cutting costs in response to a stuttering post-COVID recovery, boosting low-cost domestic e-commerce players such as PDD Holdings.
PDD, which owns Pinduoduo and overseas-focused platform Temu, soared past Alibaba on Dec. 1 to become the most valuable Chinese e-commerce company after Morgan Stanley downgraded Alibaba on concerns over slower turnaround in its cloud business and customer management revenue.
Alibaba scrapped plans to spin off its cloud business last year, citing uncertainties over U.S. curbs on exports to China of chips used in artificial intelligence applications, in a big blow to its market value at the time. Last week, sources told Reuters that Alibaba was looking to sell a number of consumer sector assets, including its grocery business Freshippo, which has been locked in a price war with Walmart’s membership chain Sam’s Club, leading both sides to cut prices on popular items.
A Freshippo spokesperson had denied the reports of a potential sale.
Alibaba’s International Digital Commerce segment, which operates various retail and wholesale marketplaces including AliExpress and Alibaba.com., performed strongly, with AliExpress orders rising 60% on the year.