Alibaba.com Q2 net profit rises 46 pct | business | Hindustan Times
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Alibaba.com Q2 net profit rises 46 pct

Alibaba.com Ltd, China's largest e-commerce company, reported a 46 percent rise in quarterly profit, beating analyst expectations, as the number of China paying subscribers increased and value-added-service revenue jumped.

business Updated: Aug 10, 2010 15:58 IST

Alibaba.com Ltd, China's largest e-commerce company, reported a 46 percent rise in quarterly profit, beating analyst expectations, as the number of China paying subscribers increased and value-added-service revenue jumped.

Alibaba.com said it was taking a cautious view on upcoming quarters as exports from China would be impacted by yuan appreciation and rising costs of labour and raw materials.

"Against the current economic backdrop, rather than simply emphasising the acceleration of customer acquisition, we will be focusing more on evolving the level of services and providing more value-added services to help our customers truly move to 'Work-at-Alibaba'," the company said in a statement.

The e-commerce company, which operates online sites connecting millions of buyers and sellers globally, is the listed unit of Alibaba Group, in which Yahoo! Inc holds a a near 40 percent stake. Alibaba Group also owns Taobao, China's largest online market place and Alipay, the country's dominant e-payment system.

Alibaba.com said April-June profit rose 46 percent to 362.95 million yuan ($53.6 million) from a restated 249.16 million yuan a year earlier. That beat an average forecast of 306.4 million yuan from four analysts polled by Thomson Reuters I/B/E/S.

Total revenue grew 49 percent to 1.37 billion yuan. Deferred revenue and customer advances for the quarter, a key measurement of future performance, rose 35 percent.

Alibaba.com competes with Global Sources Ltd in China's 1.6 billion yuan business-to-business (B2B) online marketplace industry. In the first quarter, Alibaba.com had 74 percent of the market by transaction value.

Founded by the charismatic Jack Ma, considered a pioneer in China's e-commerce sector, Alibaba.com stopped selling shark fin products last year, a reflection of Ma's stated distaste for the controversial food.

Web commerce in China has surged as buyers tap the Internet for better deals from more suppliers in the nation's highly fragmented distribution networks.

Alibaba.com's shares are down about 14 percent this year, underperforming a slight decline in the Hang Seng Index.