Alibaba’s shares slide down after projecting slowing growth
By MYBRANDBOOK
Alibaba Group Holding shares slide after projecting revenue growth will be slow this year, reflecting post-COVID-19 economic uncertainty at home as well as the potential for U.S.-Chinese tensions to disrupt its business.
Its stock slid as much as 4% in Hong Kong, after a drop of almost 6% in New York before the weekend. The e-commerce giant forecast sales growth this year of at least 27.5% to more than 650 billion yuan ($91 billion), down from 35% previously and slightly below analysts’ estimates.
Online shopping began to bounce back from March, executives said. But the tepid outlook demonstrates the world’s second-largest economy has yet to fully shake off pandemic, with consumers still hesitant about spending on big-ticket items.
“The market is a bit disappointed despite the strength given 2Q guidance of 20-30% YoY growth for JD and 99% GMV growth in 1Q20 for PDD,” CICC analyst Natalie Wu wrote.
“We regard Alibaba’s advantage as a market leader as intact and unchanged in the longer run, though it may take several quarters for market sentiment to swing back.”
Alibaba has lost more than $70 billion of market value since the coronavirus first erupted in January, and now has to grapple with not just an uncertain global economic environment but also any potential fallout from U.S.-Chinese financial tensions.
On Friday, executives sought to assuage concerns about a U.S. bill that mandates much closer accounting scrutiny of U.S.-listed Chinese companies and may bar them from American bourses.
Chief Financial Officer Maggie Wu said Alibaba’s financial statements have been consistently prepared in accordance with U.S. GAAP accounting measures and were beyond reproach. “The integrity of Alibaba’s financial statements speak for itself, we have been an SEC filer since 2014 and hold ourselves to the highest standard,” she told analysts on a conference call. “We will endeavor to comply with any legislation whose aim is to protect and bring transparency to investors who buy securities on U.S. stock exchanges.”
The bigger short-term challenge is in reviving growth: Alibaba’s bread-and-butter customer management or marketing business grew just 3% in the March quarter. Much of that stems from weaker consumer sentiment during the Coronavirus-stricken quarter, when total Chinese e-commerce rose just 5.9% or at less than a third of 2019’s pace, according to government data. Jefferies analysts led by Thomas Chong wrote that Alibaba’s guidance was in fact a positive when viewed against an array of uncertainties gripping the post-Covid 19 global economic environment.
BREAKING NEWS
TECHNO TRENDS
Nazara and ONDC set to transform in-game monetization with ‘
Nazara Technologies has teamed up with the Open Network for Digital Comme...
Jio Platforms and NICSI to offer cloud services to government
In a collaborative initiative, the National Informatics Centre Services In...
BSNL awards ₹5,000 Cr Project to RVNL-Led Consortium
A syndicate led by Rail Vikas Nigam Limited (abbreviated as RVNL), along wi...
Pinterest tracks users without consent, alleges complaint
A recent complaint alleges that Pinterest, the popular image-sharing platf...
E-Magazine
TECHNOTAINMENT
Netflix adds 'Moments' feature for saving, sharing scenes from
Netflix has introduced a new “Moments” feature on its mobile app, whic
Jacqueline Fernandez come together with YouTuber Mr. Beast for
Jacqueline Fernandez has partnered with American YouTuber Mr. Beast to b
MOVERS & SHAKERS
Visa elevates Rishi Chhabra as new Country Manager for India
Rishi holds a Master’s in Industrial Engineering from The Ohio State Univ
Genesys welcomes Albert Nel as Senior VP and Regional Sales Le
Genesys continues to deepen its investment in the APAC region. Earlier this
OPEN YOUR EYES
INTERVIEWS
Alcatel-Lucent Enterprise Carrying a 100 year legacy ahead
A good amount of R&D works and global support services are operated out of
Alpha Max offers high end solutions in the network space to en
The vision at Alpha Max is to attain quality as the trademark and create a
HOT PICK
SonicWall Launches TZ80: A Powerful Solution for Remote Office
SonicWall announced today the launch of the TZ80, a groundbreaking securit
Gigabyte X3D Turbo: A Gaming Revolution
GIGABYTE X3D Turbo Mode is a cutting-edge feature that unifies cores distr
MAKE IN INDIA BRANDS
TATA CONSULTANCY SERVICES
VERSA NETWORKS INDIA PVT. LTD.
DRUVA SOFTWARE PVT. LTD.
WIPRO LTD.
EMINENT CIO'S OF INDIA
ICONS OF INDIA
Icons Of India : MUKESH D. AMBANI
Mukesh Dhirubhai Ambani is an Indian businessman and the chairman and ...
Icons Of India : AALOK KUMAR
Aalok Kumar is celebrated as a global leader and recipient of the Peop...
ICONS OF INDIA : SACHIN BANSAL
Sachin Bansal is an Indian entrepreneur. He is best known as the found...
PARTNER SPEAKERS
PSU
CERT-IN - Indian Computer Emergency Response Team
CERT-In is a national nodal agency for responding to computer security...
IREDA - Indian Renewable Energy Development Agency Limited
IREDA is a specialized financial institution in India that facilitates...
HPCL - Hindustan Petroleum Corporation Ltd.
HPCL is an integrated oil and gas company involved in refining, market...
VIDEOS
Top 25 Brands
Global Indian industry
Indian Tech Talent Excelling The Tech World - AJAY BANGA, President - World Bank
Ajay Banga is an Indian-born American business executive who currently...
Indian Tech Talent Excelling The Tech World - Aman Bhutani, CEO, GoDaddy
Aman Bhutani, the self-taught techie and CEO of GoDaddy, oversees a co...
Indian Tech Talent Excelling The Tech World - Rajiv Ramaswami, President & CEO, Nutanix Technologies
Rajiv Ramaswami, President and CEO of Nutanix, brings over 30 years of...
STARNITE AWARDS 2024
ITFORUM 2024
CMO of the Year
WOMEN LEADERSHIP
IMAGE GALLERY
TRENDS IN TECHNOLOGY
MORE VIDEOS
ADVERTISEMENTS
TECHNOLOGY DISRUPTION
UNICORNS REVOLUTIONISING
