Commerce
Alibaba saw strong growth across all its commerce platforms which drove a 29% increase in total core commerce revenue. The company’s efforts in expanding product offerings and improving user engagement helped drive customer acquisition across top-tier and lower-tier cities as well as growth in average consumer spending.
Annual active customers on China retail marketplaces as of September 30 was 757 million, reflecting a quarterly net increase of 15 million. Alibaba’s Taobao Deals, which is aimed at value-conscious customers, played a significant role in bringing customers from lower-tier cities onto the company’s platform.
Due to the COVID-19 pandemic, several consumers turned to online channels to order groceries and fresh foods and this trend, which is still ongoing, drove growth in Alibaba’s retail channels Freshippo and Taoxianda. For Freshippo, annual active customers as of Sept. 30 reached over 26 million.
The pandemic also accelerated digitalization across the restaurant and service industry and this has benefited Alibaba’s Ele.me platform. Ele.me expanded its delivery services beyond food to categories such as groceries and flowers and these efforts helped drive a 45% year-over-year increase in average daily number of paying customers during the second quarter.
Alibaba also saw solid growth in its businesses related to international markets. Its cross-border import platform Tmall Global saw a 37% year-over-year growth in GMV during the quarter while the number of brands and merchants on the platform grew double-digits.
Cloud computing
Another key area of focus is cloud computing. During the second quarter, revenues in cloud computing grew 60% compared to the prior year driven by strong demand across the Internet, retail and finance industries. More than half of the A-share listed companies are customers of Alibaba Cloud and their average spending rose 45% YoY during the quarter. Alibaba expects its cloud business to turn profitable by the end of the current fiscal year. The company sees cloud computing as a significant area of growth and it is increasing its investments in this space.
Click here to read the full transcript of Alibaba’s Q2 2021 earnings conference call