The company said its board of directors had agreed to separate the cloud computing business.
Chinese consumer spending has gained some momentum since the country abandoned its strict anti-coronavirus policies late last year, but it remains relatively muted amid a shaky economic recovery.
Alibaba shares rose 2.5%, after an initial drop of about 1% shortly after the earnings report was released, as investors reacted to the company’s results and subsidiary plans.
Earlier this year, Alibaba announced plans to restructure into six units, a move that followed a two-year regulatory crackdown on China’s technology sector. It expects all of its units except for the China-facing e-commerce division to seek outside financing and go public.
On Thursday, Alibaba agreed to completely separate the Cloud Intelligence Group by distributing dividends to shareholders. It aims to complete the spin-off in the next 12 months.
Chief Financial Officer Toby Xu also said, “The Alibaba Board of Directors has approved the external financing start-up process for Alibaba’s international digital trade business group, the exploration of an initial public offering (IPO) for the Senao intelligent logistics group, and the implementation of the IPO of Fresh Hub.”
- Inclusion of the logistics arm
Earlier this month, Reuters reported that “the company’s logistics arm aims to raise $2 billion through a listing in Hong Kong likely to take place early next year.”
Net income attributable to common shareholders was 23.52 billion yuan, compared with a loss of 16.24 billion yuan.
Alibaba is also struggling to attract new users as China’s e-commerce sector matures, and is grappling with inroads from new competitors such as BDD Holdings and Douyin, the Chinese version of TikTok that is also owned by ByteDance. .
Alibaba Group’s revenue for the full year 2022 rose 2% to 868.69 billion yuan ($123.47 billion), marking the slowest growth rate since the company’s IPO in 2014. (Agencies)