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Alibaba: Stocks fall after slowdown warning in China

Alibaba shares fell more than 10% in Hong Kong trading after the Chinese online retail giant warned of a slowdown in consumer spending. The company expects its annual revenue to grow at its slowest since going public in 2014. The weak numbers underscore the company's struggles with increasing compet

Alibaba: Stocks fall after slowdown warning in China
Written byTimes Magazine
Alibaba: Stocks fall after slowdown warning in China

Alibaba shares fell more than 10% in Hong Kong trading after the Chinese online retail giant warned of a slowdown in consumer spending. The company expects its annual revenue to grow at its slowest since going public in 2014. The weak numbers underscore the company's struggles with increasing competition and Beijing's regulatory action.

Shares of Alibaba, which was listed in the US on Thursday, ended the New York trading session by more than 11%. In the 3 months to the end of September, Alibaba's sales rose 29 percent to 200.7 billion yuan ($31.4 billion; £23.3 billion), the slowest growth rate in a year and a half.

The company also expects annual sales to grow between 20% and 23%, below analyst projections. Alibaba head Daniel Zhang told investors that increasing competition and falling consumption in China were the main reasons behind weaker growth.

Chinese buyers are becoming more cautious in spending as the novel coronavirus epidemic, power shortages, and real estate market worries weigh on sentiment. Current figures do not include sales from this month's Single Day or the "Global 11.11 Shopping Festival", the annual shopping festival.

Alibaba's glamorous events this year are usually more ridiculous than ever after Beijing cracked down on business and slowed China's economic growth. Sales for the 11-day event grew the slowest since its launch in 2009, 8.5% more than a year earlier. However, customer spending still hit a new record of 540.3 billion yuan.

Beijing has been researching Alibaba for having imposed strict new rules on the country's big tech company. Earlier this year, he paid a $2.8 billion fine after an investigation found he had abused his market position for years. Alibaba also said it would change the way it does business. The company's stock has lost more than a third of its value so far this year.




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