Alibaba reported 14 percent revenue growth to reach 234.16 billion renminbi, or $32.29 billion, for the second quarter, beating analysts’ estimates, according to Refinitiv data.
In the three months ended June 30, income from operations jumped 70 percent year-over-year to 42.49 billion renminbi, or $5.86 billion, the company said on Thursday.
After the announcement, stocks of the U.S.-listed Alibaba advanced around 4 percent in premarket trading.
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Alibaba attributed the growth to the company’s reorganization efforts, “which [are] beginning to unleash new energy across our business,” said Daniel Zhang, chairman and chief executive officer of Alibaba Group.
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Alibaba’s core domestic e-commerce business, which falls under the Taobao and Tmall Group, rose 12 percent year-over-year to reach 30.16 billion renminbi, or $4.2 million.
The company said Taobao app’s average daily active users grew 6.5 percent year-over-year, mainly driven by the three-week-long 618 shopping festival. During 618 this year, spending by the app’s VIP customers grew in the double digits. On the secondhand marketplace Xianyu, daily active user grew 18 percent year-over-year.
Zhang took a positive outlook on China‘s consumption rebound post-pandemic, despite recent deflationary pressure. “As economic and consumer activities continue to resume, our businesses demonstrated encouraging trends,” Zhang told analysts in the earnings call.
The company’s overseas e-commerce business, which includes AliExpress, Lazada and Trendyol, jumped 41 percent to 22.12 billion renminbi, or $3.1 million, in the quarter.
Alibaba’s cloud business resumed growth in the period, posting 4 percent year-over-year growth to reach 25.12 billion renminbi, or $3.5 million. The cloud unit is expected to go public within a year, along with IPO plans for Freshippo, its supermarket unit as well as its logistics unit Cainiao.
“Freshippo might use proceeds from an IPO valuing it at $4 billion to chase Walmart’s lead in grocery e-commerce sales. After an IPO that could value it at $45 billion, Alibaba’s cloud unit might scale up with support from new strategic investors to tackle Tencent, Huawei and China Telecom,” said Bloomberg analysts in a research note.