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Alibaba Group Holding Limited (BABA - Free Report) is set to report second-quarter fiscal 2022 results on Nov 18.

For the fiscal second quarter, the Zacks Consensus Estimate for earnings is pegged at $1.87 per share, indicating a decline of 29.4% from the prior-year quarter's reported figure.

The consensus mark for the same is pegged at $31.92 billion, which suggests growth of 39.8% from the year-ago quarter's reported figure.

The company's earnings surpassed the Zacks Consensus Estimate in three of the trailing four quarters and missed the same once, the average surprise being 10.63%.

Alibaba Group Holding Limited Price and EPS Surprise

Alibaba Group Holding Limited price-eps-surprise | Alibaba Group Holding Limited Quote

Factors to Consider

Alibaba's strong efforts to add value to consumers and sellers through the consumer segment, product enrichment and platform innovations are expected to have driven growth in its e-commerce business in the to-be-reported quarter by driving its customer momentum.

The infusion of advanced technologies such as Big Data and AI into BABA's e-commerce platform is anticipated to have continued helping it in delivering enhanced customer experience.

Apart from this, benefits from the Sun Art consolidation along with a spike in the average unit price per click and solid contributions from new monetization formats are expected to have driven growth in the China commerce retail revenues in the quarter under review.

Well-performing Lazada and AliExpress are likely to have aided the performance of Alibaba's International commerce retail business in the fiscal second quarter.

The increasing number of paying members on the alibaba.com platform coupled with solid momentum across cross-border-related value-added services is expected to have contributed well to the International commerce wholesale business's growth.

Apart from e-commerce, the company's robust cloud segment is expected to have sustained its momentum in the fiscal second quarter on a growing number of paying customers.

However, we note that the company has been spending heavily in new areas of core online retail business, including supermarkets, stores, new artificial intelligence, digital entertainment and cloud computing businesses. The impacts of increased expenses are expected to get reflected in Alibaba's upcoming results.

Alibaba's increasing regulatory concerns are anticipated to have been other major headwinds in the to-be-reported quarter.

Uncertainties associated with the ongoing pandemic are anticipated to have been concerning in the quarter under review.

What Our Model Says

Our proven model doesn't conclusively predict an earnings beat for Alibaba this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that's not the case here. You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter.

Alibaba has an Earnings ESP of -6.29% and a Zacks Rank #3, currently.