Market Value of Alibaba Rises to $7.5 Billion after Adjusting 2017 Growth Forecast

The market value of Alibaba rose to $7.5 billion after the largest e-commerce company in China adjusted its growth revenue for 2017 from 48% to 53%, giving investors the confidence that the company is doing fine despite the lulling economic recession China is facing in recent times, Bloomberg reports.

Market analysts had earlier forecasted in the December quarterly results for the company that Alibaba would only be able to attract a sales revenue with a 48% value to its last earnings, but the new estimate of 53% revenue for 2017 shows the company is set to break barriers to become one of the most profitable businesses in the world.


With a stable user-base of 443 million customers, Alibaba makes most of its money from e-commerce but it is now making huge returns from recent investments in cloud computing, digital advertising, online search business, and Netflix-like entertainment among others.

At the close of stock trading in New York, Alibaba’s stocks rose by 3.1% to stay at $101.43, and this among other excellent performances is encouraging the Chinese e-commerce giant to consider taking on Amazon and Microsoft in the cloud business among other competitive areas.

For the quarter ended December 2016, Alibaba Group realized $7.8 billion or 53.2 billion yuan when analysts had actually been looking forward to 50.1 billion yuan – a 54% earnings increase. Meanwhile, Bloomberg had tabulated a total net income of 13.6 billion yuan for the same period, but Alibaba had gone ahead to earn 17.2 billion yuan – a net income increase of 38%.

To this end, investors were estimated to earn 7.70 yuan on each share they hold with the company, but they had gone ahead to receive 9.02 yuan earnings per share after all adjustments were made for December last year.

Maggie Wu, the chief financial officer for the e-commerce company said over 500 million customers patronized Alibaba’s offerings for the December quarter, with nearly 80% of these using mobile devices to access the company’s products and services. This shows that users are not only merchants who desire to sell products on Alibaba, they are also shoppers who are spending more time accessing entertainment and other related services on the e-commerce site.

After a January meeting with US President Donald Trump, Alibaba’s Chairman Jack Ma revealed within the next five years, the company intends to get one million US businesses to use its platform with a corresponding one million Americans earning daily living from the platform; while 10 million small businesses from around the world will also be attracted to using the Alibaba platform to reach a wider, global audience.

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