Chinese B2B company Alibaba has registered a 55% rise in net profit this quarter in comparison to same period last year. It is because of handsome growth in subscribers – 750,937+ paying members – and Alibaba’s added-value services posing 25% of its revenue and including additional advertising options, the company sees more than just one profitable quarter; additional ones are expected down the light.
Alibaba has been increasing growth efforts all around, spanning various interests for its web portal. Team growth, product launches and more have been focal points for Alibaba, and it’s affected their bottom line positively for Q3. As the global market makes its international rounds, Alibaba is finding new relevance in new markets.
According to David Wei, Alibaba CEO, small Chinese firms, which make up a large part of Alibaba.com’s membership base, face growing pressure from an appreciating yuan and higher raw material and staffing costs. Such pressures could potentially eat into Alibaba’s customer base.
Despite of this, Wei is optimistic that he expects solid net profit growth in the next few quarters. He also mentioned that a higher price will be conclusively implemented in 2012 on its international platform, as Alibaba will replace the low-prices membership option for an extended offerings package.
A rise of 130.1 Chinese Yuan in net profit within just one year is something some can only dream of, but that doesn’t mean the architect behind online shopping giant Taobao and Yahoo China is through there. As covered here, some rumor that Alibaba may be interested in acquiring Yahoo; the very same Yahoo that currently owns 38% of the Chinese company.