(Reuters) – China’s Alibaba Group Holding Ltd beat Wall Street estimates for third-quarter revenue on Tuesday, as its e-commerce business benefited from a switch to online shopping triggered by the coronavirus pandemic.
The results come as China clamps down on company founder Jack Ma’s business empire, having forced the suspension of a $37 billion IPO for financial affiliate Ant Group.
In November, Alibaba’s China-focused Singles Day sale – the world’s biggest online shopping event that eclipses the revenues generated on US shopping holidays Black Friday and Cyber Monday – registered sales of $74 billion in November.
Alibaba’s total revenue rose 37% to 221.08 billion yuan ($34.24 billion) in the three months ended Dec. 31, above analysts’ estimates of 214.38 billion yuan, according to IBES data from Refinitiv.
Core commerce revenue from its main e-commerce sites rose 38% to a record high of 195.54 billion yuan, powered by the company’s Chinese operations as the economy rebounded from the COVID-19 crisis.
Net income attributable to ordinary shareholders was 79.43 billion yuan, or 28.85 yuan per American depository share, compared to 52.31 billion yuan, or 19.55 yuan per ADS, a year earlier.
Revenue for cloud computing rose 50% year on year, hitting 16.12 billion yuan, as the division posted a positive EBITA for the first time.
Alibaba also said it was “unable to complete a fair assessment” of the impact that Ant’s stalled IPO will have on the company.
Authorities suspended the planned offering after Ma made public remarks criticizing the company’s financial regulators in November. In December, regulators launched a separate investigation into Alibaba over alleged monopolistic practices.
Hans Chung, analyst at KeyBanc Capital Markets, wrote that the tight scrutiny from regulators was a continuing source of concern, though he thoughts the risks would be manageable.
Ma made his first public appearance in three months in January, helping allay investor concerns and boosting the company’s share price.
(Reporting by Chavi Mehta in Bengaluru and Josh Horwitz in Shanghai; Editing by Sriraj Kalluvila and John Stonestreet)