Alibaba (ticker: BABA) on Thursday said its sales for its second fiscal quarter rose 3% to $29.12 billion. Analysts had expected sales of $29.44 billion, according to FactSet.
While the figures mark a return to growth for Alibaba after recording flat annual sales for the first time in its first quarter, it is still a historically weak expansion. The company has suffered from Beijing’s zero-Covid policy and last week declined to release sales numbers for the biggest annual shopping event in China, Single’s Day, saying only that figures were comparable with the prior year.
American depositary receipts (ADRs) of Alibaba were up more than 3% in early trading, after falling in the premarket.
Alibaba stock is up nearly 16% over the past five days, as enthusiasm about possible changes to China’s Covid-19 policy and the face-to-face meeting between the country’s leader Xi Jinping and President Biden has fueled a rally in Chinese stocks.
“We generated another quarter of healthy revenue growth of 3% year-over-year in spite of the impact on consumption demand by the Covid-19 resurgence in China as well as slowing cross-border commerce due to increasing logistics costs and foreign currency volatility,” said Toby Xu, chief financial officer of Alibaba Group.
The company said the value of physical goods sold by its online retail brands Taobao and Tmall fell by a low-single-digit percentage from the prior year, due to soft consumption demand, Covid-19 restrictions, and competition. However, its international commerce and cloud business revenue both rose by 4%.
Alibaba booked a net loss of $3.16 billion for the third quarter, which it attributed to losses on its investments in other publicly traded companies.
Alibaba’s non-GAAP (Generally Accepted Accounting Principles) net income was $4.75 billion, up 19% from the prior year. Analysts had expected non-GAAP net income of $4.28 billion according to FactSet.
Alibaba said it was increasing its stock buyback program by $15 billion and extending it to the end of fiscal 2025.