December 8, 2022

BABA stock falls due to missing quarterly results

BABA stock falls due to missing quarterly results

Ali Baba (Baba) reported quarterly results in December early Thursday that beat earnings estimates but showed the slowest revenue growth in eight years. BABA stock is down.


The Chinese e-commerce company reported adjusted earnings of $2.65 per share on revenue of $38.06 billion. Analysts expected Alibaba to report earnings of $2.55 per share on revenue of $38.9 billion. Revenue jumped 10% from the same period last year, its slowest growth since it went public in 2014.

BABA stock fell 3.3% to 106.10, during the morning move on stock market today.

In late November, Alibaba lowered its revenue growth forecast to a growth rate of 20% to 23% for the 2022 fiscal year. This is down from a previous forecast released in May by about 30%. Alibaba blamed a further slowdown in consumer spending and increased competition.

China stock reached The past year is due in large part to intensified crackdowns by Chinese government regulators. In addition to Alibaba, stocks were severely affected Baidu (Baidu) And the Tencent Holdings (TCEHY). The crackdown that began in late 2020 has hit nearly every corner of the industry, prompting investors to withdraw from Chinese stocks.

Alibaba stock does not reflect the value of the company

BABA stock is down 55% this year.

“Our current share price does not fairly reflect the value of the company,” Chief Financial Officer Toby Shaw said on an earnings conference call. “At current price levels, we plan to continue with our share buybacks. At the same time, we will maintain a strong cash position that will give us financial flexibility for future investments.”

During the December quarter, Alibaba repurchased approximately 10.1 million ADRs for $1.4 billion.

The company added 43 million active customers during the quarter, to 1.28 billion. Revenue from the cloud segment rose 20% to $3.07 billion.

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