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Alibaba Stock Overview (NYSE:BABA) – All You Need to Know About Alibaba Group

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Alibaba Stock Overview (NYSE:BABA) – All You Need to Know About Alibaba Group

Alibaba Stock Overview (NYSE:BABA) – All You Need to Know About Alibaba Group

Vantage Updated Updated Thu, 2024 January 18 07:00

About Alibaba Group

History of the company [1,2]

Alibaba Group Holding Limited, perhaps one of the most renowned Chinese multinational conglomerates, was founded in 1999 by Jack Ma and a group of 17 co-founders. 

The story of Alibaba begins in Hangzhou, China, where Jack Ma, a former English teacher, recognized the untapped potential of the internet. At a time when China had limited internet penetration, Ma envisioned a platform that would connect businesses and consumers online. With this vision, he founded Alibaba and launched its first online marketplace, Alibaba.com, in April 1999.

Initially, Alibaba.com focused on connecting Chinese manufacturers with overseas buyers, providing a platform for international trade. The company quickly gained traction, and within its first year, it attracted investments from international firms, including Goldman Sachs in 1999, and shortly followed by SoftBank in Jan 2000.

In 2003, Alibaba expanded its operations with the launch of Taobao.com, a consumer-to-consumer marketplace, mounting a direct challenge to eBay’s presence in China. To gain an edge, Alibaba decided to offer its services for free, which attracted a significant number of users. This strategy proved successful, and Taobao emerged as the dominant e-commerce platform in China, effectively pushing eBay out of the market.

Building on its success, Alibaba continued to diversify its portfolio. In 2004, it launched Alipay, an online payment platform, to facilitate secure transactions on its marketplaces. Alipay quickly gained popularity and became a vital component of Alibaba’s ecosystem.

In April 2008, Alibaba made a groundbreaking move by introducing Tmall.com, a business-to-consumer platform that allowed brands to sell directly to consumers. Tmall.com focused on higher-quality products and attracted well-known international brands, strengthening Alibaba’s position in the market.

Alibaba’s growth continued with the introduction of additional breakthroughs and new ventures. In 2009, the company launched 11.11 Singles’ Day, a made-up event that would go on to become the world’s largest shopping holiday, dwarfing even the US’s Black Friday.

In 2010, it launched AliExpress, a platform targeting international consumers, before making its debuts on the New York Stock Exchange in September 2014.

Over the years, Alibaba expanded beyond e-commerce. It ventured into cloud computing with Alibaba Cloud, entered the entertainment industry through Alibaba Pictures, and invested in various sectors, including logistics, digital media, and financial services.

The company also made significant investments abroad, including acquiring a stake in Lazada, a leading e-commerce platform in Southeast Asia.

Despite its achievements, Alibaba has faced challenges and scrutiny. In 2020, the Chinese government launched an investigation into its business practices and fined the company a record USD 2.8 billion in 2021 [3]. Alibaba has since taken steps to address regulatory concerns and strengthen its compliance.

Business segments [4,5]

Currently, the technology giant categories its business units into three main segments – consumption, cloud and globalisation. These are further separated into seven sub-categories:

  • China commerce
  • International commerce
  • Local consumer services
  • Digital media and entertainment
  • Innovation initiatives and others
  • Logistics
  • Cloud computing and infrastructure

In March 2023, Jack Ma announced a major restructuring of the company, splitting it up into six smaller units. Five of these newly formed units will also have the ability to independently seek capital and potentially raise their own IPO.

The six newly-formed business units will be: a Cloud Intelligence Group, Taobao Tmall Commerce Group, Local Services Group, Cainiao Smart Logistics, Global Digital Commerce Group, and a Digital Media and Entertainment Group. 

Alibaba is headquartered in Hangzhou, China. Its staff strength is estimated to be 235,000  as of March 2023 [6]

About the stock BABA

BABA trading information

  • Primary exchange: NYSE
  • Ticker: BABA
  • Country: U.S. 
  • Currency: USD
  • Trading hours:
    • Main: 9.30am to 4pm ET, Mon to Fri
    • Pre-market: 4am to 9.30am
    • After-market: 4pm to 8pm 

When was BABA listed?

BABA was listed on the New York Stock Exchange on 19 September 2014. The stock price at IPO was USD 68 per share, raising USD $21.8 billion for the company [7]. The share price for BABA closed at USD 79.55 on 31 May 2023 [8].

Stock splits and dividends 

BABA has not undergone any stock splits to date. The share also does not pay dividends. 

Latest developments investors should note 

Revenue for FY 2022 improved by 2%, income from operations increased 44%

A combination of regulatory crackdowns and COVID-19 difficulties saw Alibaba endure an arduous two years in 2021 and 2022. However, in its latest earnings report, signals emerged that the company is well in recovery. 

Primarily, revenue for the fiscal year ended 31 March 2023 showed a 2% gain year-on-year to USD 126.5 billion [9]. This was driven by a spike in net operating income for the year, which rose 44% spike year-on-year to USD 14.61 billion [10]. Non-GAAP diluted earnings per share came in at USD 0.99, a rise of 4% year-on-year, while free cash flow was recorded at USD 24.9 billion [11]

Further shoring up these encouraging results, Alibaba announced plans to hire at least 15,000 new employees this year, putting to rest rumours that the tech titan planned to cut 20% of its workforce that had been circulating on Chinese social media [12]. The company added that out of the 15,000 new positions, 3,000 would be reserved for new graduates. 

Trade BABA with Vantage 

Vantage offers convenient and secure trading of BABA and other leading stocks. With share Contracts for Difference (CFDs), traders can access trading opportunities from stock price movements in all directions, without having to own the underlying assets. 
Trade BABA with zero commission using Vantage share CFDs. Sign up and start trading today!

References

  1. “About Alibaba – Alibaba”. https://www.alibabagroup.com/en-US/about-alibaba. Accessed 2 June 2023.
  2. “Nov. 11 Is Singles Day — Is It Bigger Than Black Friday? – Nasdaq”. https://www.nasdaq.com/articles/nov.-11-is-singles-day-is-it-bigger-than-black-friday. Accessed 2 June 2023.
  3. “China hits Alibaba with record $2.8 billion fine for behaving like a monopoly – CNN Business”. https://edition.cnn.com/2021/04/10/tech/alibaba-china-record-fine/index.html. Accessed 2 June 2023
  4. “Our Businesses – Alibaba”. https://www.alibabagroup.com/en-US/about-alibaba-businesses. Accessed 2 June 2023.
  5. “Alibaba will split into six units, reshaping Jack Ma’s business empire – CNN Business”. https://edition.cnn.com/2023/03/28/tech/alibaba-restructuring-ipos/index.html. Accessed 2 June 2023.
  6. “Alibaba’s Cloud Arm to Cut 7% of Staff in Overhaul, Sources Say – Yahoo! Finance”. https://finance.yahoo.com/news/alibaba-cloud-arm-cut-7-102544684.html. Accessed 2 June 2023.
  7. “Why Did Alibaba Choose to Go Public in the U.S.? – Investopedia”. https://www.investopedia.com/articles/investing/112614/alibaba-ipo-why-list-us.asp. Accessed 2 June 2023.
  8. “Alibaba Group Holding Limited (BABA) – Yahoo! Finance”. https://finance.yahoo.com/quote/BABA/history?p=BABA. Accessed 2 June 2023.
  9. “Alibaba Group Announces March Quarter and Full Fiscal Year 2023 Results – Businesswire”. https://www.businesswire.com/news/home/20230517005640/en/Alibaba-Group-Announces-March-Quarter-and-Full-Fiscal-Year-2023-Results. Accessed 2 June 2023.
  10. “Alibaba Group Announces March Quarter and Full Fiscal Year 2023 Results – Nasdaq”. https://www.nasdaq.com/press-release/alibaba-group-announces-march-quarter-and-full-fiscal-year-2023-results-2023-05-18. Accessed 2 June 2023.
  11. “Alibaba Group Announces March Quarter and Full Fiscal Year 2023 Results – Businesswire”. https://www.businesswire.com/news/home/20230517005640/en/Alibaba-Group-Announces-March-Quarter-and-Full-Fiscal-Year-2023-Results. Accessed 2 June 2023.
  12. “Alibaba says to hire this year, refuting layoff rumours – Reuters”. https://www.reuters.com/business/alibaba-says-hire-this-year-refuting-layoff-rumours-2023-05-25/. Accessed 2 June 2023.
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