At the same time the Hangzhou-based company said sales from its commerce business rose 34% in the three months ending in June, compared to a year ago.
Alibaba’s shares have soared by more than 20% this year as investors around the world poured money into technology companies seen to have benefited from people staying at home during the coronavirus pandemic.
Alibaba’s strong results mirror China’s economic rebound post the pandemic.
In fact, the company said as much during its earnings call – attributing the jump in revenue to China’s “effective management” of the outbreak in much of the country.
But there’s also the fact that the coronavirus fundamentally changed consumer behaviour in China.
In the midst of lockdowns, people flocked online to buy things like yoga mats and face masks.
Since then, as Chinese consumers came out of quarantine, there was a big rise in, for example, cosmetics sales.
But the pandemic also pushed more people online to buy their groceries, and it’s a trend that’s continued in a post-coronavirus China.
Still a rebound isn’t a recovery – yet. And while Alibaba’s recovery depends mainly on the fortunes of the Chinese market, tensions between Beijing and Washington will weigh on both its and China’s growth prospects.
Trump’s China crackdown
The placatory comments from Alibaba’s boss came in a week that has seen Mr Trump using his election campaign speeches to threaten further action to push back against China.
At an event in Pennsylvania on Thursday he said that if he is re-elected, Washington will impose tariffs on American companies that refuse to move jobs back to the US.
“We will give tax credits to companies to bring jobs back to America, and if they don’t do it, we will put tariffs on those companies, and they will have to pay us a lot of money,” he said.
That came on top of the president’s pledge earlier this week to offer tax credits to entice US firms to move factories out of China.
He also threatened to strip US government contracts from companies that continue to outsource work to China.