“IN FIVE years, we will sell one trillion dollars.” That is the bet that Jack Ma, the chairman of Alibaba, made with American businessmen on a recent trip to Chicago. The Chinese firm is already the world’s biggest e-commerce outfit. But now Mr Ma thinks he can more than double the volume of sales on his firm’s online-sales platforms by 2020.
First, he must win over investors. The firm’s shares have fallen sharply from their peak of $119 late last year, though at around $74 they remain above the $68 price at which they (or rather, shares in a “variable interest entity” linked to Alibaba, and registered in the Cayman Islands) were floated last September. On August 12th Alibaba unveiled its latest results. Its quarterly revenues grew by 28% year on year to 20.2 billion yuan ($3.3 billion), and profits rose by 23% to 10.6 billion yuan. Yet investors were still disappointed. The firm now plans to spend up to $4 billion on buy-backs to bolster its share price.
Part of the reason that profit growth was not stronger is that Alibaba is investing heavily in such growth areas as the mobile internet. Promisingly, its quarterly...
from The Economist: Business http://ift.tt/1JeTrD1
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