Alibaba revenue soars ahead of IPO

Wed Aug 27, 2014 5:24pm EDT
 
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By Abhirup Roy and Alexei Oreskovic

(Reuters) - Alibaba Group Holding Ltd's [IPO-BABA.N] revenue accelerated in the second quarter on strong gains in its mobile business, providing investors with what may be the final glimpse of the Chinese e-commerce company's financials before its expected landmark market debut.

Alibaba, whose IPO could be the largest ever by a technology company, said mobile revenue was roughly a third of its total transaction volume in the three months ended June 30, up from 27.4 percent in the first three months of the year.

Revenue in the second quarter increased 46 percent year-on-year to $2.54 billion, a faster pace than the 38.7 percent revenue growth that Alibaba posted in the first quarter.

Net income attributable to Alibaba's ordinary shareholders nearly tripled to $1.99 billion, or 84 cents per share, in the quarter.

"The main positive I take away is that (it) seems the mobile monetization is on a very strong upwards trajectory," Atlantic Equities analyst James Cordwell told Reuters.

"The results are very positive overall for the forthcoming IPO and I think you can see valuations to head north of $200 billion as we go through the IPO process," Cordwell said.

Alibaba accounts for about 80 percent of all online retail sales in China, where rising Internet usage and an expanding middle-class helped the company generate gross merchandise volume of $296 billion in the 12 months ended June 30.

With people increasingly accessing the Internet from smartphones and tablets, online companies ranging from social networks such as Facebook Inc (FB.O: Quote) to e-commerce companies like Amazon.com Inc (AMZN.O: Quote) have been investing heavily to develop their mobile platforms.   Continued...

 
People play in a hall inside Alibaba's headquarters in Hangzhou, Zhejiang province, April 23, 2014. REUTERS/Chance Chan