Alibaba Posts Strong Second Quarter Mobile Results Ahead of IPO

NEW YORK (TheStreet) – Alibaba posted strong calendar second quarter mobile results, as the Chinese e-commerce company moves towards an initial public offering expected sometime in September.

The company grew revenue over 46% from year-ago levels to $2.54 billion, while total gross merchandising volumes (GMVs) rose a similar percentage, led by a near-doubling in Tmall volumes. Alibaba also disclosed in its second quarter results that mobile GMVs now account for 32.8% of the company's total marketplace volume, a near tripling from this time last year.

Alibaba's quarterly results indicate that the company is making continued progress in capturing a rising share of the Chinese mobile commerce market ahead of its highly anticipated initial public offering. However, mobile growth may be cutting into the company's short-term profitability trends. Alibaba's operating profit rose 26% to $1.1 billion, a slower pace than the company's overall revenue growth rate.

Read More: Alibaba Restructures Alipay Relationship

Earlier in August, Alibaba restructured its relationship with payments business Alipay in a move that gives the e-commerce giant a smaller exposure to financial services, but the potential to receive a larger pie of fees from those businesses.

Alibaba disposed its SME loan business to Small and Micro Financial Services Company, which also owns Alipay, for a $518 million cash consideration and annual fees for seven years based on the average daily size of the SME loan portfolio. Between 2015 and 2017, Alibaba will receive a fee equal to 2.5% of the daily average loan balances of the SME business. For remaining years, Alibaba will receive an amount equal to its 2017 fee.

If you liked this article you might like

Equifax Breach Reveals Frightening Truth: Companies Can Delay Disclosing Hacks

How Alibaba's 'Genie' Smart Speaker Can Overcome the Amazon Echo's 3-Year Head Start and Still Win

Facebook, Apple, Netflix and Google Have Caught the Flu -- Here's How Not to Get Killed By It

How to Play the Coming 'FANG Flu'

Travis Kalanick and the Terrible, Horrible, No Good, Very Bad Week