Chinese e-commerce giant Alibaba on Thursday reported a loss of 20.6 billion yuan ($2.89 billion) for the third quarter, as the company grapples with an economic slowdown and an anti-monopoly crackdown.
The heavy net loss attributable to ordinary shareholders was primarily due to a “decrease in market prices of our equity investments in publicly traded companies”, among other factors, the company said in a statement.
Alibaba’s performance is widely seen as a gauge of Chinese consumer sentiment, given its market dominance.
Revenue for the three months ending September 30 was up three percent year-on-year at 207.2 billion yuan, which Chief Financial Officer Toby Xu said was achieved “in spite of the impact on consumption demand by the Covid-19 resurgence in China as well as slowing cross-border commerce”.
Alibaba said it achieved revenue growth by “enhancing operating efficiency” as well as through the expansion of its logistics and services businesses, despite a slump in e-commerce sales within China.
It comes after the company earlier this year reported flat quarterly revenue growth for the first time ever.
The company said in its statement on Thursday that revenue from domestic commerce had fallen in the third quarter, “mainly as a result of softer consumption demand, Covid-19 resurgence and restrictions, as well as ongoing competition”.
In a sign of difficulties for Alibaba, the company appears to have laid off a number of employees, with its headcount down more than 1,700 from the previous quarter.
China’s major tech companies have faced economic uncertainty, Covid-19 restrictions that have depressed consumer spending, as well as heightened scrutiny from regulators in recent months.
Fellow tech titan Tencent reported on Wednesday its second quarterly drop in revenue in a row.
Alibaba in particular has been at the centre of regulatory crackdowns at home and abroad.
US authorities have put the company on a watchlist that could see it delisted in New York if it does not comply with disclosure orders, causing its shares to slump.
Chinese authorities pulled a planned IPO by the company’s financial arm Ant Group at the last minute in 2020, then hit Alibaba with a record $2.75 billion fine for alleged unfair practices last year.
The company’s Singles Day e-commerce festival, which traditionally dwarfs similar US events such as Black Friday and Cyber Monday, has been more muted in recent years.
Alibaba — alongside main rival JD.com — did not release full sales figures for the shopping bonanza for the first time ever this year, instead saying in a statement that sales were flat from last year.