Alibaba misses revenue estimates; boosts buyback by $25 bln (updated)

Haidilao International Holding

07/02/2024 11:39

(Adds details on share repurchase, shares in paragraph 2, 3)
       SHANGHAI, Feb 7 (Reuters) - China's Alibaba Group
Holding  9988.HK  on Wednesday missed analysts' estimates for
third-quarter revenue, hurt by softness in the retail market and
sagging economic recovery in the world's second-largest.
    The company's U.S.-listed shares  BABA.N , which announced
an increase of $25 billion to its share repurchase program
through the end of March 2027, were up 3.5% in premarket
trading.
    Alibaba announced the split of its business into six units
last March in a transition overseen by CEO Eddie Wu and Chairman
Joe Tsai, both Alibaba co-founders.
    Wu, Group CEO since September, has been consolidating his
control over Alibaba's core businesses and has told staff the
company's strategic focuses would be "user first" and
"AI-driven" as it combats slower earnings growth.
    However, the e-commerce giant is under pressure from a slow
recovery in China's online shopping market after the country
lifted its pandemic curbs a little more than 12 months ago. 
    Consumers in the world's second-largest economy have been
cutting costs in response to a stuttering post-COVID recovery,
boosting low-cost domestic e-commerce players such as PDD
Holdings  PDD.O , which owns Pinduoduo and overseas-focused
platform Temu, and prompting Alibaba to increase its focus on
discounting and lower-priced goods.
    Last year, Alibaba scrapped plans to spin off its cloud
business, citing uncertainties over U.S. curbs on exports to
China of chips used in artificial intelligence applications.
    Meanwhile, Alibaba's logistics division, Cainiao, has
applied to list in Hong Kong, and just last week, sources told
Reuters Alibaba was looking to sell a number of consumer sector
assets, including its grocery business Freshippo, retailer
RT-Mart and shopping mall operator Intime.
    The company reported revenue of 260.35 billion yuan  ($36.19
billion) for the three months ended Dec. 31, compared with
262.28 billion yuan expected by 19 analysts polled by LSEG.

($1 = 7.1941 Chinese yuan renminbi)

 (Reporting by Harshita Varghese, Savyata Mishra and Casey Hall;
Editing by Himani Sarkar ad Sriraj Kalluvila)
 ((Casey.Hall@thomsonreuters.com;))