Despite a sharp increase in turnover, Alibaba has recorded its first loss in nine years. The reason being, the Chinese government imposed a record-breaking fine on the e-commerce company for monopoly practices at the end of last year.
More than 1 billion active customers
In the last quarter of its broken financial year, Alibaba saw its turnover rise by no less than 64 per cent to 187.4 billion yuan (24 billion euros). But due to the mega fine of the equivalent of about 2.3 billion euros that Beijing imposed in December, the Chinese online retailer suffered an operating loss of 7.66 billion yuan (984 million euros). Not taking the fine into account, the operating profit would have increased by 48 per cent, stated the e-commerce group in an accompanying note to the figures.
Alibaba's 'punishment' did not end at a fine. Jack Ma's company was also required to take a series of measures to ensure fair competition and respect consumer rights. The actions against the online retailer are part of Beijing's wider efforts to curb the power of its own large tech companies. Earlier, the authorities also stopped the planned IPO of Alibaba sister company Ant Group at the last minute.
In the full financial year 2020/2021, Alibaba generated revenues of over 717 billion yuan (92 billion euros), an increase of 41 per cent. Operating profit fell by 2 per cent to the equivalent of 11.5 billion euros. Taking all services into account (retail, entertainment, etc.), the Chinese group now has more than 1 billion active customers, almost a quarter of them coming from outside of China.