×
You will be redirected back to your article in seconds

Alibaba Quarterly Profits Double to $2 Billion Despite Entertainment Losses

Chinese e-commerce giant Alibaba saw revenues increase by 56% to $7.4 billion in the three months to June, the company reported Thursday. Net income was up by 96% to $2.07 billion.

Alibaba’s digital media and entertainment division – now considered a core business area – had revenues of RMB4.08 billion ($600 million), but remained heavily loss-making. Net losses in the period were reported as RMB1.75 billion ($257 million), compared with RMB996 million ($146 million) in the comparable quarter in 2016.

The group portrayed the quarter as a period of continued investment in the division. “The management focus of our digital media and entertainment segment was on broadening our access to quality content, developing [streaming video platform] Youku Tudou’s subscription-based business, and expanding the products and services of [mobile browser] UCWeb,” the group said in a statement.

It said that its strategy of acquiring and developing licensed and original content yielded hit drama and variety shows during the quarter and that daily average subscribers of Youku video had more than doubled compared with a year ago. However, market reports now put Youku in third place behind streaming rivals iQIYI and Tencent Video.

“We believe a strong pipeline of content, especially with a focus on original content with visibility of content availability and broadcast timing flexibility, will bring us sustainable long-term advantages in video entertainment,” it said.

Alibaba shares are traded on the New York Stock Exchange and have climbed 29% in the past three months as the group has participated in the wider tech rally. They closed at $159.50 on Wednesday. Following publication of the quarterly results, the shares were up a further 5% to $167.60 in pre-market trading Thursday.

Management delivered a strongly bullish message about ongoing prospects. “Alibaba had a strong start to fiscal 2018, reflecting the strength and diversity of our businesses and the value we bring to customers on our platforms. Our technology is driving significant growth across our business and strengthening our position beyond core commerce,” said CEO Daniel Zhang.

The results reflect the ongoing strength of consumption by Chinese consumers – about 529 million mobile users were active on a monthly basis – and the popularity of e-commerce and doing business online. Major international brands including Moet Hennessy, Victoria’s Secret and Abercrombie & Fitch all used Alibaba’s T-Mall to build online platforms in China. The results include barely a month of the Intime brick-and-mortar department store chain in which Alibaba bought a controlling stake in May.

More Biz

  • CAA HQ LA

    Ex-Agent Stuart Manashil Ordered to Repay CAA in Fraud Case

    Former literary agent Stuart Manashil was ordered on Thursday to repay a $23,975 commission to CAA, which he admitted he had illegally diverted to a friend. Manashil, who now runs his own management company, pleaded guilty in March 2018 to a federal wire fraud charge. In a letter to U.S. District Judge Kimba Wood, Manashil [...]

  • "The Continent," directed by Chinese racer

    Alibaba Pictures Buys Into Chinese Director Han Han's Film Studio

    Alibaba Pictures confirmed that it has invested an undisclosed amount in Chinese celebrity blogger-turned-film director Han Han’s Shanghai Tingdong Film. Han’s upcoming “Pegasus” is one of the most anticipated films of the year in China. Alibaba Pictures, part of e-commerce giant Alibaba, is now the second-largest stakeholder in Tingdong. It has a 13.1% stake, according to Chinese [...]

  • Phil McIntyre Steps Down as Roc

    Phil McIntyre Steps Down From Roc Nation Management, but Remains Affiliated With Company

    Phil McIntyre has stepped down as president of Roc Nation Management, but his PhilyMack management company remains affiliated with Roc, a source close to the situation tells Variety. PhilyMack, which McIntyre founded in 2006, partnered with Roc Nation in 2015. The source stressed that McIntyre’s role at Roc Nation Management  — whose clients include Rihanna, [...]

  • Harvey Weinstein Trial

    Ben Brafman Drops Out of Harvey Weinstein Rape Case

    Harvey Weinstein has officially parted ways with defense attorney Ben Brafman, releasing a joint statement Thursday announcing the move. Weinstein had clashed with his defense attorney over strategy in his rape and sexual assault case. The pair issued a statement saying their parting was amicable, and that Brafman would cooperate fully with Weinstein’s new attorneys. [...]

  • Netflix - Apple TV

    Netflix Turns in Record Q4 Subscriber Gain, Price Increase Weighs on U.S. Forecast

    Netflix is beating Wall Street expectations for international subscriber growth — but its recently announced price increase in the U.S. may have put a damper on its momentum in the States. For the fourth quarter of 2018, Netflix reported 1.53 million paid net adds in the U.S. and 7.31 million internationally, to end the year [...]

  • Heather Parry Live Nation

    Live Nation Investigation of Heather Parry Also Targets Leakers (EXCLUSIVE)

    Over the past two weeks, the law firm of Paul Hastings LLP has been probing allegations reported by Variety last month that Heather Parry, the head of Live Nation Productions, had verbally abused employees and used offensive language in the workplace. But the lead investigator, Elena Baca, seems to be just as interested in uncovering [...]

  • Leslie Moonves

    Leslie Moonves to Pursue Arbitration for His $120 Million Severance From CBS

    Former CBS Corp. chairman-CEO Leslie Moonves will pursue an arbitration claim to fight CBS for the $120 million severance that he was denied last month when the company’s board of directors determined he was fired for cause. Moonves was ousted in September after multiple women came forward with allegations of sexual misconduct against the longtime [...]

More From Our Brands

Access exclusive content