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Alibaba adds 20 million users; sales surge 42 per cent

Alibaba Group boosted second-quarter revenues by 42 per cent, as the number of active users on its e-commerce sites grew by 20 million. 

“Alibaba had a great quarter, expanding our user base to 674 million annual active consumers, demonstrating our superior user experience,” said Daniel Zhang, CEO.

“We will continue to expand our customer base, increase operating efficiency and deliver robust growth. With strong cash flow from our core commerce business, we will continue to invest in technology and bring digital transformation to millions of businesses globally,” he said.

CFO Maggie Wu said the company was pleased to see sustained user engagement and consumer spending across its platforms. “We continue to invest for long-term growth while at the same time gaining cost efficiencies in our investment areas,” she said.

The group reported net income attributable to shareholders of RMB21.252 billion (US$3.096 billion), on total revenue of RMB114.924 billion (US$16.741 billion). The annual active consumers on the group’s Mainland China retail marketplaces reached 674 million in the year to June 30. 

The company said its Taobao marketplace was the fast-growing consumer community, adding users and strengthening engagement in less-developed areas of the mainland. “The increase in annual active consumers reflects strong user acquisition programs, such as referrals through the Alipay app and another record-breaking 6.18 Mid-Year Shopping Festival, which deepened our penetration into less-developed areas,” the company said. 

“During the quarter, more than 70 per cent of the increase in annual active consumers was from less-developed areas, demonstrating the success of our initiatives to cater to a broader base of users, such as using simpler interfaces for first-time or less-frequent users.”

Sales on grew at 34 per cent year on year, driven by increases in the number of users and their average spend, reflecting strength in fast-moving consumer goods, apparel, consumer electronics and home furnishings.

Alibaba’s self-owned-and-operated grocery-retail chain Freshippo (Hema) continued to achieve robust same-store sales growth, expand its footprint, optimising its stores and introducing new initiatives to improve the customer experience, the company said. As at June 30, there were 150 self-operated Freshippo stores in 17 mainland cities.

The group’s international business also showed growth, especially in Southeast Asia where Lazada showed “solid operational improvement” after strengthening its third-party marketplace business, management team and technology infrastructure. For the third consecutive quarter, Lazada achieved more than 100-per-cent year-on-year order growth.

This story first appeared on sister site Inside Retail Asia.

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