In this video I try to answer the question many investors ask today: Is Alibaba (NYSE:BABA) stock worth buying, knowing the China risk? I will also explain what the Alibaba Group actually is, because it's a company that owns various businesses such as Taobao, Tmall, AliExpress, and many more. You can find the video below.
In Q4, Alibaba reported revenue of $28.6 billion, a 64% year-over-year increase. Operating income was negative for the first time in years as a result of the antitrust probe in China. In fiscal 2021, Alibaba generated 87% of its revenue and all of its profits from its core commerce unit, which includes its Taobao and Tmall marketplaces, brick-and-mortar stores, and cross-border and international marketplaces. It had more than 1 billion annual active consumers globally and $1.2 trillion in GMV.
Alibaba Cloud experienced robust revenue growth of 37% year over year during the March quarter. Its market share stands at 6%; for comparison, Amazon's AWS has 32%.
The Alibaba business
Alibaba Group owns many businesses, so I'll list some below and discuss them further in the video.
- Taobao (which means "searching for treasures" in Chinese): A business-to-consumer (B2C) business. It has over 2 billion listings in products and services.
- Tmall: A platform for high-end B2Cs such as Piaget, Nike, and Ralph Lauren that want a presence in the Chinese market.
- Tmall Global: A cross-border business-to-consumer marketplace.
- AliExpress: An international commerce retail marketplace.
- Alibaba.com: A wholesale marketplace.
- Alibaba Cloud: A web services business similar to Amazon's AWS and Microsoft's Azure.
- Freshippo: A high-tech grocery chain.
*Stock prices used were the closing prices of July 17, 2021. The video was published on July 19, 2021.