This post was originally published on this site
https://i-invdn-com.investing.com/news/LYNXMPEA7S04H_M.jpg
Investing.com – Alibaba (NYSE:BABA) Group Holding Ltd.’s (HK:9988) Hong Kong shares tumbled after the Chinese e-commerce giant slashed its outlook for fiscal 2022 revenue.
Shares fell 10.13% to HK$140.20 ($18) by 9:46 PM ET (2:46 AM GMT).
Alibaba reported a less-than-expected 29% rise in revenue for the September quarter to CNY200.7 billion ($31.44 billion). The company forecast 20% to 23% growth in fiscal 2022 revenue, lower than the widely expected 27% growth. Net income also fell 81% to CNY5.4 billion, also missing estimates after Alibaba marked down the value of equity investments.
The company will share more details on its outlook at an annual investor forum starting Dec. 16, said Alibaba CEO Daniel Zhang.
Weaker consumer spending and intensifying competition contributed to the lowered outlook. The slowdown is likely to continue into the December quarter inclusive of the Single’s Day shopping festival. Alibaba recorded sales of $84.5 billion for the event during the previous week, which was another record but a sharp slowdown compared to previous years.
Competitors such as JD (NASDAQ:JD).com Inc. (HK:9618) and Pinduoduo (NASDAQ:PDD) Inc. are also upping the competition for Alibaba users. Pinduoduo’s number of annual active shoppers hit 849.9 million in the 12 months to June 2021, surpassing Alibaba’s figure. JD.com is also attracting new brands like Starbucks (NASDAQ:SBUX) and Estee Lauder (NYSE:EL) to join its platforms.
The latest COVID-19 outbreak in the country is also dampening consumer sentiment. “Looking ahead, we will continue to invest heavily into three growth engines of domestic consumption, globalization, cloud computing and data intelligence,” said Zhang.
