Alibaba surges while Walmart stalls

Alibaba surges while Walmart stalls

Online retail giant Alibaba has again reported strong earnings, posting a 56% rise in quarterly revenue.

Net income grew by 94% to 14.7bn yuan ($2.2bn; £1.7bn;) for the three months ending June 30, compared to the same period last year.

The performance is in sharp contrast to US big box retailer Walmart, which posted a 23% drop in net income.

Analysts say the two results reflect both a global shift towards e-commerce and a broader shift towards Asia.

Alibaba's surging earnings

Investors have shown unbridled enthusiasm for Alibaba this year. The company's shares were up 5% on the results, and they are up 81% this year.

While these numbers seem almost unbelievable by US or European standards, some analysts think there's still plenty of room for growth.

"That's the challenge evaluating these companies because the market dynamics are so different than in the US and Europe," said Ben Cavender, from China Market Research Group.

He says e-commerce still only accounts for about 15% of the total retail market in China, so there's still plenty of untapped potential.
Read More...