Stay-at-home orders during the Covid-19 pandemic pushed up sales on China’s major e-commerce platforms as more people went online for daily essentials.
Industry behemoth Alibaba Group Holdings Ltd. reported stronger-than-expected 22% revenue growth for the fiscal fourth quarter ended March 31. Rival Pinduoduo Inc. posted a 44% revenue gain for the same three months.
“The pandemic has fundamentally altered consumer behavior and enterprise operations, making digital adoption and transformation a necessity,” said Daniel Zhang, chairman and chief executive officer of Alibaba. Total annual active customers on Alibaba’s platforms expanded to 960 million globally, or about one of every eight people worldwide, the company said.
Alibaba’s revenue climbed to $16.1 billion, according to the company’s earnings report Friday. Net income declined 99% to $49 million, mainly reflecting decreases in the market value of equity investments in publicly traded companies, Alibaba said. On an adjusted basis, Alibaba earned $1.30 a share, up 7% from a year ago.
The company projected that sales for its next fiscal year could jump 25% to $91 billion. For the 2020 fiscal year, Alibaba’s revenue rose 35% to $72 billion. Net income for the year was $19.8 billion, up 75% from the previous year.
Discount group-buying site Pinduoduo reported revenue of $923.8 million. Its net loss widened to 4.12 billion yuan in the quarter ended March 31 from 1.88 billion yuan a year earlier.
The five-year-old marketplace has attracted 628 million active buyers, an increase of 42% year-on-year.
“Despite the outbreak and seasonality, we were able to ship on average 50 million daily orders in March to meet our users’ needs,” said David Liu, Pinduoduo’s vice president for strategy. “As the economy worldwide regains its foothold, we are seeing opportunities for investments and partnerships such as our recent investment in GOME Retail Holdings. Our strong balance sheet allows us to act quickly on such opportunities.”
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