Alibaba Surpasses Q3 Earnings & Revenue Estimates

Alibaba Group Holding Limited (BABA - Free Report) reported third-quarter fiscal 2020 (ended Dec 31, 2019) earnings of $2.61 per ADS, surpassing the Zacks Consensus Estimate by 16%. Also, the bottom line increased 49% year over year.

It reported revenues of RMB161.5 billion (US$23.19 billion), up 38% from the prior-year quarter. The year-over-year revenue increase was driven by strength in the company’s China commerce retail business and cloud computing.

Also, revenues surpassed the Zacks Consensus Estimate of US$22.68 billion.

Revenues by Segments

Alibaba has four reportable segments — Core Commerce, Cloud Computing, Digital Media and Entertainment, and Innovation Initiatives. The details of these segments are discussed below.

Core Commerce: This segment comprises marketplaces operating in retail and wholesale commerce in China, and international commerce. The segment’s revenues in the quarter totaled RMB141.5 billion (US$20.3 billion), reflecting an increase of 38% on a year-over-year basis.

China commerce retail business(68% of total revenues)The business vertical’s revenues in the quarter were RMB110.5 billion (US$15.9 billion), reflecting an increase of 36% year over year.

China commerce wholesale business (2% of total revenues) — This business generated revenues of RMB3.4 billion (US$483 million), reflecting a 25% increase from the year-ago quarter. The increase was due to a rise in average revenues from paying members on 1688.com, strength in domestic wholesale marketplace and revenue growth from Lingshoutong.

International commerce retail business (5% of total revenues) — Revenues in the quarter were RMB7.4 billion (US$1.06 billion), increasing 27% year over year. The increase was driven by revenue growth from AliExpress and Lazada.

International commerce wholesale business (1% of total revenues) — This business generated revenues of RMB2.46 billion (US$353 million), increasing 13% from the prior-year quarter. The growth was due to an increase in the number of paying members on the alibaba.com platform.

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