One of the Chinese technology giants is trying to find its way back to the top. Alibaba Group has stepped the upwards trajectory of its total revenue, net income and the value of its stocks. In fiscal year Alibaba earned almost 10 bn USD in net income. Over 50 percent more than just two years ago.
Alibaba Group is a Chinese multinational company which specializes on e-commerce, internet, retail and technology. It was founded in late June of 1999 by a group of 18 students led by later billionaire Jack Ma. Alibaba became very soon one of the most expanding Chinese companies, that later went public via IPO at Hong Kong Stock Exchange.
At the end of 2020 Alibaba Group stocks suffered a crash to the lowest close in around 6 months, following an antitrust investigation by Chinese regulators. They stated that it opened an investigation into Alibaba because of the monopolistic practices.
Alibaba went almost bankrupt, but in 2023 it announced a restructuring plan for the following years. This plan reorganized Alibabba´s business structure into six independently run entities: Cloud Intelligence Group, Taobao and Tmall Group, Cainiao Smart Logistics Network, Local Services group, Alibaba International Digital Commerce, and the Digital Media and Entertainment group. Each business unit would have their own CEO and board of directors and be able to seek their own fundraising and market listings.
Alibaba Group started to rise from the ashes very soon. In 2023 Alibaba gained revenues almost 870 bn RMB which represented a year-on-year increase by nearly two percent. In the 2024 fiscal year its revenues reached more than 941 bn RMB – another increase on the year-on-year basis by 8,5 percent. Net income rose during the same period from 47 to 71,3 bn RMB. It was an increase by more than 51 percent. Its operating income rose by almost two thirds between 2022 and 2024 to more than 113 bn RMB.
Now Alibaba Group seems to be stabilized which is also being appreciated by the investors. Alibaba stocks gained around 16,5 percent on the year-on-year basis. Since the beginning of this year the increase of the stocks market value was much more substantial because the Alibaba stocks gained more than 27 percent.
Anyway, the Alibaba stocks are still below their all-time highs reached in the turn of 2020, but in recent several months it seems that Alibaba is again in the spotlight of investors. Only time will tell whether Alibaba Group definitely survived its death.
Alibaba Group Holding Ltd. (Stocks year-to-date change in %)
Source: Marketwatch.com
Oleh Shalenyk, financial analyst of Alpho
