Why Alibaba Shares Tanked Today

Ali Baba (NYSE: BABA) posted its latest set of quarterly results late Wednesday, and investors responded by trading the major Chinese company’s shares lower the next day. During that trading session, the price of American Depositary Shares (ADSes) fell almost 4%, while remaining essentially flat. S&P500 Table of contents.

Turnover in the fourth quarter increased, while the adjusted net result decreased

For the fourth quarter, Alibaba posted total revenue of just over 260.3 billion yuan ($36.56 billion), up 5% year-on-year. According to non-GAAP (adjusted) standards, it earned just under 48 billion yuan ($6.7 billion), down 2% from the same quarter of 2022. On an ADS basis, that adjusted net income was 18.97 yuan ( $2.66).

Neither figure met analyst expectations. On average, forecasters tracking the growing tech stocks forecast slightly higher revenue earnings of nearly 260.7 billion yuan ($36.61 billion) and adjusted net earnings per ADS of 19.17 yuan ($2.69).

In the quarter, Alibaba’s largest business unit – its domestic e-commerce operations of Taobao and Tmall – saw its revenue rise a rather meager 2% to almost 123.8 billion yuan ($17.4 billion). It had more success at the international digital trading group that runs popular online retail site AliExpress, but even with 44% year-on-year growth, the figure was relatively low: less than 20 billion yuan ($2.8 billion).

The $25 billion added to the stock repurchase authorization made no impact

Alibaba did not provide any guidance in announcing its earnings figures. However, it briefly touched on its future strategy by quoting CEO Eddie Wu: “We will go a step further…

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