Alibaba Group reported total revenue of RMB50,184 million (US$7,403 million) for Q2 2017, an increase of 56% year-over-year. Tmall recorded 49% year-over-year growth for physical goods GMV.
- Revenue from core commerce increased 58% year-over-year to RMB43,027 million (US$6,347 million).
- Revenue from cloud computing increased 96% year-over-year to RMB2,431 million (US$359 million); it reached a key milestone of exceeding one million paying customer
- Revenue from digital media and entertainment increased 30% year-over-year to RMB4,081 million (US$602 million).
- Revenue from innovation initiatives and others increased 21% year-over-year to RMB645 million (US$95 million)
Tmall recorded 49% year-over-year growth for physical goods GMV in the quarter ended June 30, 2017. Fashion and apparel, consumer electronics and fast moving consumer goods, or FMCG, were among the key categories that experienced robust and reaccelerating GMV growth during the quarter according to Alibaba.
Alibaba has established Tmall as a leading brand-building and distribution platform that is capturing increasing digital marketing and commerce spending from owners of both domestic and international branded products that are doing business in China. During the quarter, international brands such as Moet Hennessy, Victoria’s Secret, Roland and Abercrombie & Fitch established Tmall flagship stores to engage with and sell their
products to consumers on its platforms.
Annual active consumers (annual active buyers) on Alibaba’s China retail marketplaces reached 466 million, an increase of 12 million from the 12-month period ended March 31, 2017. Mobile MAUs on its China retail marketplaces reached 529 million in June, an increase of 22 million over March 2017.
Net income was RMB14,031 million (US$2,070 million), income from operations was RMB17,513 million (US$2,583 million) and adjusted EBITDA was RMB25,124 million (US$3,706 million). Operating margin was 35%, adjusted EBITDA margin was 50% and adjusted EBITA margin for core commerce was 63%。
Integration of online and offline retail experience
In May 2017, Alibaba completed the privatization and the acquisition of a controlling stake in Intime Retail Group for HK$12.6 billion (US$1.6 billion). Intime is a leading department store and mall operator in China with 49 department stores and shopping malls as of June 30, 2017.
Alibaba expects Intime to support its strategy to transform conventional retail, especially in soft goods and branded products, by leveraging Alibaba’s substantial consumer reach, insight, and technology.
Revenue from Alibaba’s international commerce retail business reached meaningful scale at RMB2,638 million (US$389 million) in the quarter ended June 30, 2017, representing a 136% year-on-year growth, driven by strong growth in its Southeast Asian platform Lazada (Alibaba increased its ownership in Lazada to 83%)and its China outbound platform AliExpress.
Lazada launched “Taobao Collection” in Singapore and Malaysia, which expands Lazada’s product offering by giving local customers access to products from China.
In June, Alibaba hosted Gateway ’17 in Detroit, Michigan – a conference where 3000 U.S. small businesses, farmers, brands, and entrepreneurs attended to learn about how to sell to China using Alibaba as their gateway. Businesses such as Gerber, Stadium Goods, and 100% Pure shared their experiences on how Alibaba has helped them grow their businesses by tapping into the China market, which is good for the Chinese consumer as well as for business growth and jobs creation in the United States.
On September 25, Alibaba will host a similar event in Canada to educate and engage Canadian businesses in selling to China.
In July Alibaba launched its first AI-powered voice assistant, Tmall Genie, which was developed by Alibaba’s AI Lab leveraging Alibaba’s AI technology. The Tmall Genie assists with shopping, ordering local services, searching for information, controlling smart appliances and playing multi-media content, including educational stories and music for children.
In August, with Marriott, Alibaba established a joint venture to provide a completely new travel experience for hundreds of millions of Chinese consumers with personalized VIP experiences, cashless travel and an integrated loyalty program.