Alibaba raises sales forecast after results top estimates

Bloomberg

Alibaba Group Holding Ltd. raised its outlook for full-year revenue growth after reporting sales that beat analysts’ estimates, buoyed by advertisers who spent more to lure shoppers.
China’s biggest e-commerce company is now predicting a 49 to 53 percent rise in revenue in the current fiscal year, after acquiring and folding in results from its logistics arm Cainiao. It reported a 61 percent rise in sales to $8.3 billion in the three months ended in September, surpassing the 52 billion-yuan projected. Alibaba’s shares climbed 4.3 percent in pre-market trade.
The e-commerce giant has opened its wallet to woo shoppers and improve marketing services for merchants while splurging billions to look for new sectors of growth. It’s shaking up supermarkets and department stores while investing in artificial intelligence and cloud computing, areas in direct competition with Amazon.com Inc. The Chinese company’s cloud business almost doubled revenue in the quarter, sustaining a rapid pace of growth.
“Alibaba is doing really well in advertisement monetisation, in that sense it’s more like a media company than an e-commerce company,” said Steven Zhu, a Shanghai-based analyst at Pacific Epoch. “The company’s ability to make money from its mobile app has improved significantly.”