Alibaba.com Q3 profitgoes up the roof with 11.9 percent increase

Alibaba.com Q3 profitgoes up the roof with 11.9 percent increase

The listed unit of Alibaba Group operates an e-commerce website that links Chinese businesses looking to sell their goods to overseas buyers. Alibaba Group, founded by billionaire Jack Ma, is 40 percent owned by Yahoo Inc.

Alibaba.com’s exposure to international markets makes its turnover sensitive to the performance of the world’s major economies such as the United States and Europe.

"The third quarter of 2011 presented a picture filled with challenges arising from the weaknesses in the U.S. economy and the debt troubles in the euro zone, which have threatened to spin out of control," Alibaba.com said in its earnings statement.

"We are more cautious about the global economic outlook and believe that it may have a prolonged impact on China’s export sector," the firm said.

Growth in China’s factory output is likely to fall slightly to 12-13 percent in 2012 due to weakening global demand, the industry ministry said on Thursday, but that level probably still implies a comfortable GDP growth rate of 8-9 percent next year.

Fears that China may be set for a sharp slowdown flared again on Wednesday after HSBC’s flash PMI survey showed the factory sector shrank the most in 32 months in November on signs of domestic economic weakness.

"Despite the stress posed by the external environment, we will stay focused on upgrading our business model and building quality, trustworthy e-commerce platforms," Alibaba.com’s chief executive, Jonathan Lu, said in a statement.

Net profit for July-September rose to 409.7 million yuan ($63 million) from 366.1 million yuan a year earlier, below an average forecast of 432.23 million yuan from three analysts polled by Thomson Reuters I/B/E/S.

Revenue grew 10.6 percent to 1.6 billion yuan. Revenue from its international marketplace rose 11.8 percent to 947.5 million yuan.

Revenue from its China Gold Supplier membership package was up 11.5 percent at 918.6 million yuan, contributing 57.3 percent to total revenue. Value-added services formed 30 percent of China Gold Supplier revenue in the quarter.

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Posted by Hassan Ali on Nov 24 2011. Filed under Business. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry