For the quarter ending March 31, 2017 revenue was RMB38,579 million (US$5,605 million), an increase of 60% year-over-year. Revenue from core commerce increased 47% year-over-year to RMB31,570 million (US$4,587 million). Revenue from cloud computing increased 103% year-over-year to RMB2,163 million (US$314 million). Revenue from digital media and entertainment increased 234% year-over-year to RMB3,927 million (US$571 million).
For the fiscal year ended March 31, 2017, net cash provided by operating activities was RMB80,326 million (US$11,670 million) and non-GAAP free cash flow was RMB68,790 million (US$9,994 million).
Revenue from innovation initiatives and others increased 88% year-over-year to RMB919 million (US$133 million). Annual active buyers on our China retail marketplaces reached 454 million, an increase of 11 million from the 12-month period ended in December 2016. Mobile MAUs on our China retail marketplaces reached 507 million in March, an increase of 14 million over December 2016. The number of paying customers of our cloud computing business grew to 874,000 from 765,000 in the previous quarter. Operating loss from cloud computing was RMB505 million (US$73 million) and adjusted EBITA loss was RMB169 million (US$24 million).
Net income was RMB9,852 million (US$1,431 million), income from operations was RMB9,532 million (US$1,385 million) and adjusted EBITDA was RMB16,597 million (US$2,411 million). Operating margin was 25%, adjusted EBITDA margin was 43% and adjusted EBITA margin for core commerce was 59%. · Diluted EPS was RMB4.12 (US$0.60) and non-GAAP diluted EPS was RMB4.35 (US$0.63). · Net cash provided by operating activities was RMB10,746 million (US$1,561 million) and nonGAAP free cash flow was RMB7,980 million (US$1,159 million).
- Revenue from core commerce increased 45% year-over-year to RMB133,880 million (US$19,450 million).
- Revenue from cloud computing increased 121% year-over-year to RMB6,663 million (US$968 million).
- Revenue from digital media and entertainment increased 271% year-over-year to RMB14,733 million (US$2,141 million).
- Revenue from innovation initiatives and others increased 65% year-over-year to RMB2,997 million (US$435 million).
- Annual active buyers on our China retail marketplaces reached 454 million, an increase of 31 million from the 12-month period ended on March 31, 2016. Combined annual active buyers on our AliExpress and Lazada marketplaces was 83 million.
- Mobile MAUs on our China retail marketplaces reached 507 million in March, an increase of 97 million over March 2016.
- GMV transacted on our China retail marketplaces in fiscal year 2017 was RMB3,767 billion (US$547 billion), an increase of 22% compared to RMB3,092 billion in fiscal year 2016.
- We have capitalized on the trend of user growth and proliferation of usage in the transition from desktop computers to mobile. Mobile GMV transacted on our China retail marketplaces was RMB2,981 billion (US$433 billion), or 79% of total GMV, an increase of 49% year-over-year. Mobile revenue from the China commerce retail business was RMB90,731 million (US$13,182 million), or 80% of our China commerce retail revenue, an increase of 80% year-over-year. During fiscal year 2017, monetization of our mobile commerce platforms outpaced the monetization of the desktop computer platforms.
- The number of paying customers of our cloud computing business grew to 874,000 from 513,000 as of March 31, 2016. For the full fiscal year 2017, operating loss from cloud computing was RMB1,681 million (US$244 million) and adjusted EBITA loss was RMB476 million (US$69 million).
Net income was RMB41,226 million (US$5,989 million), income from operations was RMB48,055 million (US$6,981 million) and adjusted EBITDA was RMB74,456 million (US$10,817 million). Operating margin was 30%, adjusted EBITDA margin was 47% and adjusted EBITA margin for core commerce was 62%.
Diluted EPS was RMB16.97 (US$2.47) and non-GAAP diluted EPS was RMB23.44 (US$3.41).
Net cash provided by operating activities was RMB80,326 million (US$11,670 million) and nonGAAP free cash flow was RMB68,790 million (US$9,994 million).
BUSINESS AND STRATEGIC UPDATES:
Core Commerce Taobao – personalized data powering higher consumer engagement. The Taobao App’s highly relevant and engaging content continues to drive robust growth in active users and engagement. e three months since December 2016, we added 14 million mobile MAUs on our China retail marketplaces, increasing mobile MAUs to 507 million in March 2017. This strong mobile user growth reflects our efforts to establish the Taobao App as a destination platform not only for shopping, but also for sharing product knowledge and lifestyle content, which drive effective user engagement and retention. During the quarter, we launched new features and content, continuing to offer enhanced and unique user experience on the Taobao App. For example, the “digital mirror” feature on the Taobao App allows consumers to virtually apply different shades of makeup. In addition, following the successful launch of its webisodes series in 2016, during this quarter Taobao aired “Night Warriors,” a new series of webisodes that promotes household products. This video campaign is part of Taobao’s larger efforts to position itself as a lifestyle destination for consumers, especially younger shoppers.
Tmall – brands’ partner of choice. We have established Tmall as a leading brand-building platform that is capturing increasing marketing spend from owners of both domestic and international branded products doing business in China. As of March 2017, 75% of the consumer brands that ranked in Forbes Top 100 World’s Most Valuable Brands have established digital operations on Tmall. Tmall also enables brands to gain invaluable consumer insights for the China market for new product launches, brand-building, customer acquisition and customer lifecycle management. For example, during the quarter, Alfa Romeo, the luxury auto brand, forged an exclusive strategic partnership with Tmall to market and sell its cars online in China. The consumer data generated through our platforms enabled the automaker to gain greater insights about its potential customers in China faster and more effectively. In addition, Mattel, the leading global childhood 4 play and development company, began working with our AI Lab to develop new and innovative products, designed to aid child development through the use of cutting-edge technology and interactive learning.
Commerce technologies and services – offering value enhancing technologies and services for merchants. Since November 2015, we have used artificial intelligence to handle the massive volume of inquiries from consumers through chatbots. As of March 2017, this AI technology is able to handle on a real-time basis millions of customer inquiries daily. During this quarter, we made our AI technology available to merchants doing business on our China retail marketplaces through a service named “Store Concierge.” This proprietary technology uses natural-language processing to help merchants to efficiently handle consumer inquiries such as returns and refunds, especially during peak promotional seasons. It also supports other services, such as providing personalized recommendations and promotion and discount information. International – laying the foundation for long-term growth.
Our international consumer and cross-border businesses saw robust growth during the quarter. Our international consumer platform AliExpress and Lazada achieved 83 million annual active buyers combined for the twelve months ended March 2017. AliExpress currently operates sixteen local language sites, including sites in Russian, Spanish and French.
During the quarter, we joined forces with government entities to launch an e-hub for trade clearance and logistics in Malaysia under our Electronic World Trade Platform (eWTP) initiative to facilitate cross-border trade between China and Southeast Asia and among Southeast Asian countries. This digital free trade zone will offer simple and straightforward regulations, lower barriers for entry into new markets and provide small businesses with easier access to financing. Cloud Computing Alibaba Cloud was China’s largest provider of public cloud services in 2016, as measured by revenue, according to IDC.
In the March 2017 quarter, Alibaba Cloud launched 152 new products and features including cutting edge big data solutions. As of March 2017, paying customers for cloud computing grew to 874,000, an increase of approximately 109,000 from the previous quarter, driving revenue growth to 103% year-over-year. Our cloud computing customer base spans a variety of industries and businesses from startups to large corporations, covering industry segments across consumer brands, energy, financial institutions, healthcare, manufacturing, media and retail. Alibaba Cloud’s top priority remains expanding its market leadership.
Digital Media and Entertainment We see tremendous opportunities to drive synergies between our digital media and entertainment and core commerce offerings. We have leveraged the consumer reach of our commerce and affiliate payment businesses to drive subscriber growth for Youku Tudou’s premium online video content. In addition, data generated from our entertainment offerings have enabled us to drive better personalized recommendations on our core commerce platforms. UCWeb continues to experience rapid growth in its international user base. During the quarter, UCWeb’s news and content aggregator service, UC News Feeds, crossed 100 million MAUs in India and Indonesia combined.
Innovation Initiatives and Others AutoNavi has been strengthening its leading position as a digital map, navigation and location-based services infrastructure provider in China by utilizing big data and machine learning technology. Currently, AutoNavi not only supports our core commerce and other affiliated businesses (Taobao, Tmall, Koubei and Cainiao Network), but also serves enterprises in other industries in our ecosystem, such as ride sharing, mobile phone, food delivery, social media, and travel services. The use case expansion and improving user experience have supported rapid user growth for the AutoNavi App. According to Quest Mobile, the AutoNavi App is one of the top two map apps in China during the quarter, as measured by MAUs.
Source: Alibaba Earnings Release