Chinese tech giant Alibaba clocked an impressive fourth quarter, despite the ongoing US-Sino trade war, with revenue rising 51% to $13.9 billion beating estimate of $13.3 billion. The number of active customers reached 654 million, rising 18 million from the previous quarter and 102 million from the same period a year ago.
The main driver for this growth was e-commerce businesses made up of Taobao marketplace and Tmall. The core commerce revenue of the company rose 54% to $11.8 billion during the period, as the company continued to penetrate across the less developed cities and acquire new customers.
Owing to the increase in average spending per customer, Alibaba Cloud business emerged as a strong revenue generator as the cloud computing segment saw its revenue jump 76% to $1.15 billion.
However, operating income fell 5% during the quarter owing to $250 million lawsuit settlement in the U.S. and spending to consolidate Ele.me as well as increased inventory and logistics expenses at its new retail and direct sales businesses. However, investment income came at $2.8 billion during the said quarter offsetting that drop in operating income. As a result, adjusted earnings per share increased 50% to $1.28 beating expectations of $0.93.
By 2020, the company plans to grow its revenue by 32.7% to 500 billion RMB, or $74.5 billion, apparently unperturbed by the recently escalated U.S.-China trade war. The company confirmed negotiations to amend trade imbalance as well as addressing infringements on intellectual property rights. These will encourage more imports from outside of China.