China's e-commerce giant Alibaba saw its quarterly sales rise, boosted by robust advertising revenues and diversification efforts from cloud to meal delivery, despite competitive edge on all fronts.
Alibaba, listed in New York, announced Thursday that it has recorded a 61% sales jump in the first quarter (April-June) of the year, to 80.9 billion yuan ($ 12.2 billion)), minus more what the analysts at the Bloomberg office expected.
What reassures the market: the title Alibaba jumped at 4.55% on Wall Street around 13:45 GMT.
Admittedly, the group saw its net profit decline by 41% to $ 1.3 billion, but this decline is explained in its opinion by exceptional fees and rewards paid to employees of its financial arm Ant Financial due to an improved valuation of the subsidiary.
On the other hand, China's largest online retailer is benefiting fully from the slow growth of mobile transactions: at the end of June, the platforms had 634 million active monthly users who connected via smartphones, 20% more than a year earlier.
After investing heavily in artificial intelligence, the group founded by the iconic multi-billionaire Jack Ma offers advertisers the ability to focus more and more on the consumer.
As a result, in its core online sales business, which still delivers the vast majority of its revenues (86%), Alibaba saw its revenue increase 61% to $ 10.5 billion.
The group is counting on its technological lead to stop Chinese rivals to lower their market share, JD.com but also Pingduoduo – a low-priced article platform recently listed on Wall Street.
– Shops in hard –
But Alibaba also relies on the combination of its e-commerce platforms and traditional physical stores: identifying better consumer trends, improving its algorithms and improving the focus of advertising media.
"Everything is there, Alibaba has a wealth of consumer data and the growing interactions between its services (…) help to strengthen the strength of its advertising adaptation technologies," notes Cindy Liu, an industry analyst. eMarketer cabinet.
Moreover, a sign that the diversification strategy is paying off, Alibaba's revenues earned by the other business sectors are merging.
They have almost doubled for cloud or cloud computing and have risen 46% for entertainment and media (the Youku video platform).
Daniel Zhang, General Manager of Alibaba, said Thursday "a + continuum + diversified services", an ecosystem where consumers stay longer.
With its Taobao and Tmall platforms, Alibaba dominates about 60 percent of China's online retail market, according to eMarketer.
But the group develops close interactions with the traditional hard-core business: it invests in distribution chains, while its own connected miniskis thrive under the Hema brand (45 branches in China).
– Ant Financial under pressure –
Alibaba said on Thursday that her home delivery service Ele.me, which he had bought the entire capital in April, had managed to bring "about $ 3 billion in investment promises," including from the Japanese Softbank. .
What can it afford to resist fierce competition, especially against Meituan-Dianping Chinese moloch deliveries of dishes.
Another highlight: Ele.me recently worked with American coffee giant Starbucks, who was very popular in China, to deliver his drinks.
But the expansion of Hema supermarkets and the acquisition of Ele.me also weighed on the Alibaba margins: the adjusted earnings per share this quarter amounted to 8.04 yuan, below expectations (8, 19 yuan).
"Despite the short-term costs, the group is building a robust ecosystem," and "offering diversified products" will support sales growth, mitigates Mae Huang, SWS Research analyst, quoted by Bloomberg.
On the other hand, Ant Financial, a company controlled by Jack Ma, who manages the Alipay electronic payment application, suffers from his long struggle with the competitive system of the web giant Tencent … just like the recent hardening of Beijing for the finances in line .
In this context, Ant Financial, which announced that Alibaba will acquire 33% in January, has postponed the IPO, initially planned for this year, reports the Financial Times, which mentions sources that are close by.