Alibaba's Q1 Results: Revenue Miss Despite Revival Efforts

Alibaba Non-GAAP EPADR of $2.26 beats by $0.17, revenue of $33.47B misses by $1.15B

Alibaba press release (NYSE:BABA): Q1 Non-GAAP EPADR of $2.26 beats by $0.17. Revenue of $33.47B (+4% Y/Y) misses by $1.15B. More on Alibaba Alibaba: Stay Calm And Keep Buying Alibaba: Buybacks To Fuel Growth In FY Q1 Earnings Alibaba's Future: International Commerce And Cloud AI Deployment Michael Burry's Scion Asset sheds Safe Bulkers, adds Hudson Pacific, others in Q2 Alibaba Q1 earnings on deck: What to expect

Alibaba dips after Q1 revenue misses estimates despite ongoing revival efforts

For the fiscal first quarter ended June 30, non-GAAP earnings per American depositary share, or ADS, fell 5% year-over-year to RMB16.44 ($2.26), but beat estimates. Meanwhile, revenue grew about 4% year-over-year to RMB243.24B ($33.47B) but missed analysts' expectations. "In this quarter, we continue to invest for growth in our core businesses while reducing losses in other business units through operating efficiency. We maintained the integrity of our margins and delivered consistent adjusted EBITA," said Alibaba's CFO Toby Xu. Alibaba, once China's best contender to become a trillion-dollar company, has been facing competition from rivals such as PDD (PDD) and JD. com (JD). Net income declined 27% year-over-year to RMB24.02B ($3.31B) for the quarter, starting April 1 to June 30, 2024. "Our focus on enhancing user experience by offering quality products at attractive prices with great service led to stabilizing market share of Taobao and Tmall Group as we returned the business on the growth trajectory," said Alibaba's CEO Eddie Wu. Revenue from Cloud Intelligence, which is developing AI models, rose 6% year-over-year to about RMB26.55B or roughly $3.65B. Alibaba said AI-related product revenue continued to grow at triple-digits year-over-year. The company noted that it will continue to invest in customers and technology, mainly in AI infrastructure, to increase cloud adoption for AI and maintain its market leadership. Alibaba International Digital Commerce -- which operates various retail and wholesale marketplaces including Lazada, AliExpress, Trendyol, Daraz, Miravia and Alibaba.com -- saw revenues increase 32% year-over-year to RMB29.29B ($4.03B). Taobao and Tmall Group's revenue fell about 1% year-over-year to RMB113.37B ($15.60B). Revenue from the company's China commerce retail business in the quarter ended June 30 dipped 2% year-on-year to RMB107.42B ($14.78B). Revenue from China commerce wholesale business in the quarter was RMB5.95B ($819M), an increase of 16% year-over-year. Local Services Group revenue increased 12% year-over-year to RMB16.23B ($2.03B), driven by the order growth of Amap and Ele.me, and revenue growth from marketing services. Revenue from Cainiao Smart Logistics Network grew 16% year-over-year to RMB26.81B ($3.69B), mainly due to increase in revenue from cross-border fulfillment solutions. Digital Media and Entertainment's revenue climbed 4% year-over-year to RMB5.58B ($768M). Stock Buyback: Alibaba said that during the quarter it bought back 613M ordinary shares (equivalent to 77M ADSs) for $5.8B, including the repurchase of about $1.2B of ADSs.