Alibaba Sales Increase 46%
Buoyed By Mobile Ad Revenues
Spurred by mobile ad revenues, China-based e-commerce firm Alibaba Group announced its sales for the quarter ended June 30 jumped 46% to $2.54 billion. Net income almost tripled to $1.99 billion, or 84 cents per share. Higher costs narrowed Alibaba’s profit margin to 54%, down from 56% a year earlier.
Alibaba is bolstering its sales not only through its burgeoning platforms, but through added customers, as well. The company had 279 million active buyers at the close of the quarter, a 50% rise from a year ago. The number of monthly mobile users, meanwhile, increased 15% over the prior three months to 188 million. Digital is driving Alibaba’s advances, as about one-third of the company’s merchandise volume now stems from mobile, leaping from about 12% a year earlier. Acquisitions have strengthened the firm, too, as Alibaba has announced 29 deals worth $16 billion since the start of 2012.
Following strong quarterly profits gains, analysts say it now appears increasingly likely that Alibaba’s upcoming IPO will become the largest ever in the U.S., generating as much as $20 billion. Alibaba could be valued at $200 billion, according to experts, after it goes public on the New York Stock Exchange next month. It’s believed Alibaba will list the week of September 15, although the company could change its plans, based on investor sentiment and other factors.
While Alibaba has ties to payment processing, cloud computing and film production, it’s most well-known for its websites that allow merchants to sell items – including promotional products – directly to people worldwide. Alibaba was founded in 1999 by Counselor Power 50 member Jack Ma, a former schoolteacher who owns 9% of the tech firm.