Alibaba powered ahead of analyst estimates to see revenues rise 37 per cent over its previous quarter, but concerns remain over growing government crackdowns.
The Chinese ecommerce giant saw revenues hit RMB221.1 billion (£25.09 billion) over its third quarter, comfortably beating analyst expectations.
However, its growth was largely driven by its recent acquisition of supermarket chain Sun Art which it purchased in October, as well as China’s economic growth during the period.
Not including sales from new investments, Alibaba saw revenues jump 27 per cent year-on-year, while income from operations rose 24 per to RMB49 billion (£5.56 billion).
This marked the slowest pace of growth since Alibaba went public in 2014 excluding the first quarter of 2020 when China was ravaged by the pandemic.
Despite the promising sales figures, analysts have warned that the Chinese government’s growing scrutiny of Alibaba’s dominant market position could pose major threats moving forward.
This regulatory pressure has seen 15 per cent wiped off Alibaba’s market value since October, when its founder Jack Ma made a speech criticising the country’s financial system.
Ma’s speech plastered a target on Alibaba’s head leading Ant Group’s initial public offering (IPO) to effectively be cancelled in November.
Ant Group, Alibaba’s financial technology business, was set to achieve the biggest ever stock market debut raising a record $37 billion.
The delayed or potentially cancelled IPO, alongside an investigation into Alibaba’s dominant market position, has left the door open for rivals like JD.com and Pinduoduo to expand.
“If the Chinese government is looking to crack down on outspoken entrepreneurs and take a more conservative line with their larger tech businesses then this will dent investors’ confidence in the brand, and may create an opening for others to exploit,” Publicis Sapient’s retail analyst Andy Halliwell said.