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Alibaba shares slump on slow Chinese spending

The company forecast that its annual revenue would grow at the slowest pace since its stock market debut in 2014.

IANS | New Delhi |

Alibaba shares slumped by more than 10 per cent in Hong Kong trade after the Chinese online retail giant warned of a slowdown in consumer spending, BBC reported.

The company forecast that its annual revenue would grow at the slowest pace since its stock market debut in 2014.

The weak figures underscore the firm’s struggles with increasing competition and Beijing’s regulatory crackdown, the report said.

On Thursday, Alibaba’s US-listed shares ended the New York trading session more than 11 per cent lower.

Alibaba chief executive Daniel Zhang told investors that increasing competition and slowing consumption in China were the main causes for the weaker growth.

Chinese shoppers have become more cautious about spending, with new coronavirus outbreaks, power shortages and concerns about the property market weighing on sentiment, the report said.

The latest figures do not include sales from this month’s Singles Day, or the “11.11 Global Shopping Festival,” annual shopping festival.

This year’s Alibaba’s usually glitzy event was a more toned-down affair than previously after Beijing cracked down on businesses and China’s economic growth slows, the report said.

In the three months to the end of September, Alibaba’s revenue rose by 29 per cent to 200.7bn yuan ($31.4bn), its slowest rate of growth for a year and a half.

The company also said it expects its annual revenue to grow by between 20 per cent to 23 per cent, lower than analysts’ forecasts.

Alibaba has come under intense scrutiny from Beijing as tough new rules have been imposed on the country’s big technology companies.