Chinese tech giant Alibaba said Thursday it posted its first negative quarter of growth since 2014 in the second quarter of 2022, blaming “challenges posed by the resurgence of COVID-19,” according to a press release.
Alibaba’s April-June revenue fell 0.1 percent from the same period a year earlier, equivalent to $30.7 billion. according The Wall Street Journal. The driver of the revenue decline was supply chain and logistics constraints resulting from China’s strict “zero COVID-19” policies that have largely ravaged the Chinese economy, according to Alibaba. Press release.
“External uncertainties, including, but not limited to, international geopolitical dynamics, the resurgence of COVID, and China’s macroeconomic policies and social trends are beyond what we can influence as a company,” its chief executive said on Thursday Alibaba, Daniel Zhang. earnings call.
Alibaba shares rose about 1.3% by the end of the day Thursday, as a negative growth rate of 0.1% beat analysts’ expectations, according to the WSJ.
Alibaba launches in a flat.
$1 billion in revenue every 3 days. pic.twitter.com/vRzHdWhGyk
— Jon Erlichman (@JonErlichman) August 4, 2022
Alibaba executives are confident that as restrictions begin to ease, the company is poised for continued growth. (RELATED: Déjà Wuhan: Chinese city where COVID started ordered to lock down again)
“After a relatively slow April and May, we saw signs of recovery in our business in June. We are confident of our growth opportunities in the long term, given our high-quality consumer base and the resilience of our diversified business model that meets the diverse demands of our customers,” the company said in the press release.
China locked down large parts of the country to stop the spread of COVID-19 in April and May, which curtailed economic activity while adding complications to shipping within and between cities. according Reuters.
China’s overall economy also contracted in the second quarter, growing just 0.4% year-on-year and actually shrinking from the first quarter – the first time that has happened apart from the first quarter of 2020 when COVID-19 completely shut down the country , the Daily Caller News Foundation previously reported.
Alibaba did not immediately respond to DCNF’s request for comment.
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