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<Research>UBS: BABA-W's Cloud Biz Revenue Growth Beats Last Qtr; Mgmt Outlook on Capital Expenditure Still Key
Recommend 12 Positive 27 Negative 10 |
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BABA-W (09988.HK) recorded a 5% YoY increase in revenue to RMB248 billion for 2FQ ending September, beating expectations by 3%, according to a report from UBS. Excluding the impact of disposing of first-party offline retail assets, the company's revenue would have risen by 15% YoY. Its adjusted EBITA fell by 78% YoY to RMB9.1 billion, still beating UBS' expectation of RMB6.5 billion, thanks to better-than-expected profit margins in e-commerce and "all other" businesses. By business segment, BABA-W's China e-commerce group (Taobao & Tmall and instant retail) performed better than expected last quarter. Supported by strong AI demand, its cloud business revenue also beat forecasts with a surge of 34% YoY. With BABA-W's announced plans to ramp up investment over the next three years to exceed the original target of RMB380 billion and Tencent's conservative outlook, BABA-W management's outlook on future capital expenditure remains crucial. UBS gave Alibaba (BABA.US) a target price of USD216 and a Buy rating. AAStocks Financial News |
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