Alibaba.com, China's largest e-commerce firm, beat forecasts with a 29 percent rise in quarterly net profit, its smallest rise in about 1-1/2 years, and warned that the adverse global economic outlook could hit its second half.
Alibaba.com, the listed unit of Alibaba Group, which is 40 percent owned by Yahoo Inc, operates an e-commerce website that links Chinese small businesses looking to sell their goods to overseas buyers, which makes its turnover sensitive to the performance of the world's major economies such as the United States and Europe, which are struggling with crippling debt crises.
The global economy, especially in Europe and America, we think will turn weak, said Jonathan Lu, chief executive of Alibaba.com.
Alibaba.com said revenue from its China Gold Supplier package was up 20 percent at 921.19 million yuan in the quarter, contributing 56 percent to total revenues, it said in a statement on the Hong Kong stock exchange.
But paying members fell 2.1 percent from the previous quarter to 832,469. Its China Gold Supplier package and Global Gold Supplier package saw a 3.7 percent and 3.2 percent fall in subscribers, respectively, as the company tried to control the quality of subscribers.
If you look at their growth rate next year, it will probably slow down as well, said Dick Wei, an analyst of JPMorgan in Hong Kong. I think the negative outlook of the macro-economy will also affect them as well.
Net profit in April-June jumped to 464.55 million yuan ($99 million) from 362.96 million yuan a year earlier. That beat the average forecast of 420.4 million yuan from five analysts surveyed by Thomson Reuters I/B/E/S.
Revenue grew 19 percent to 1.62 billion yuan. Revenue from its international marketplace rose 20 percent to 948.97 million yuan.
Late last month, Alibaba Group struck a deal with Yahoo and Softbank Corp over a transfer of Chinese e-payments unit Alipay to group founder and chief executive Jack Ma.
Alibaba.com shares were up 2.69 percent before the results. They have lost about 35 percent this year, underperforming the Hang Seng Index, which is down 15 percent.
(Reporting by Melanie Lee and Lee Chyen Yee; Editing by Will Waterman)