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·         Alibaba Stock Gains As Quarterly Earnings Easily Beat Views

·         Alibaba Offers a Positive Signal Amid China’s Sagging Growth



Alibaba Stock Gains As Quarterly Earnings Easily Beat Views


Brian Deagon, Investor's Business Daily

Nov 1, 2019


Alibaba (BABA) reported better-than-expected fiscal second-quarter results, as its cloud computing revenue soared 64%. The Alibaba earnings report came before the market open.


The China e-commerce giant reported adjusted earnings of $1.83 per share on revenue of $16.65 billion. Wall Street expected Alibaba earnings of $1.51 per share on revenue of $16.47 billion.


Revenue climbed 40%...





Alibaba Offers a Positive Signal Amid China’s Sagging Growth

Rising sales and profitability suggest the country’s growing middle class still feels inclined to spend despite the trade war and other problems.


By Paul Mozur, The New York Times (NYT)  

Nov. 1, 2019


SHANGHAI — Alibaba, the Chinese e-commerce giant, reported better-than-expected sales growth for the three months that ended in September, in a sign that the world’s largest group of consumers is still shopping online despite the country’s slowing growth.


An e-commerce goliath and a symbol of China’s rising tech prowess, Alibaba has lately taken on a different significance to investors: a canary in the coal mine of China’s slowing economy.


China this month posted its slowest economic growth figures in three decades. The simmering trade war with the United States has hit the country’s exports and investments, while Beijing has kept banks from turning on the lending spigot to wean the country from its addiction to borrowing. 


Chinese consumers, a powerful and growing source of spending that international companies like General Motors and Starbucks have come to rely on, have shown uncharacteristic signs of skittishness. Some young people say they are putting off spending on big-ticket items to prepare for what would be the first slowdown in their lives.


Still, Alibaba has been able to shrug off signs of economic wear. It has prospered thanks in large part to an ever-expanding Chinese middle class, which turns to the internet to buy just about everything.


In an investor call,  Daniel Zhang, the chief executive, acknowledged that “geopolitical uncertainties” put pressures on global growth, but added that Alibaba’s new challenge was to find “more opportunities in an uncertain environment.”


“We see great potential in domestic consumption as an important driver for the Chinese economy,” said Mr. Zhang. He added that Alibaba has benefited as consumers have made up a larger portion of China’s overall economic growth, noting that retail sales in the first nine months of 2019 grew at a faster pace than the economy as a whole.


The company said Friday that its revenue had risen 40 percent, to $16.7 billion . Net profit more than tripled to $10.1 billion based on shifts in its investments, including a one-time gain of nearly $10 billion it recognized after receiving a one-third stake in Ant Financial, its online payment sister company. Without that gain, it said, its profit would have risen 30 percent compared with a year ago.


Nevertheless, Alibaba has not been immune to China's slowdown...