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Alibaba Misses Profit Forecast Despite 54 Percent Sales Increase

Alibaba Misses Profit Forecast Despite 54 Percent Sales Increase

By Reuters | Updated: 4 November 2014 18:22 IST

Alibaba Group Holding, posted net profit well below estimates even as revenues rose in the Chinese e-commerce giant's first quarterly report to Wall Street since its record-setting $25 billion (roughly Rs. 1,53,300 crores) listing.

The profit miss was due to share-based compensation expenses and an increase in amortisation of intangible assets, the company said.

Net income attributable to shareholders fell 38.6 percent year on year to $494 million (roughly Rs. 3,000 crores) in its second quarter to Sept. 30, under performing analyst estimates of $1.17 billion (roughly Rs. 7,100 crores), according to a Thomson Reuters SmartEstimate poll of 21 analysts.

Revenue for the quarter rose 53.7 percent to 16.83 billion CNY ($2.75 billion) (roughly Rs. 16,800 crores), above expected sales of $2.7 billion (roughly Rs. 16,500 crores). Mobile revenue was more than ten times higher than in the same period last year. Diluted earnings per share were $0.20.

Alibaba shares were up 2.8 percent in pre-market trading in New York, from $101.80 at Monday's close.

© Thomson Reuters 2014

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Further reading: Alibaba, Internet