Alibaba’s cloud services business emerges as bright spot for tech giant amid slower growth in core e-commerce operations
- Alibaba Cloud operates in a domestic market that is worth about US$158 billion annually
- This business unit currently offers cloud computing services in 25 regions around the world
The Hangzhou-based firm’s Alibaba Cloud unit, which is China’s largest cloud infrastructure services provider, operates in a major domestic market that is worth about 1 trillion yuan (US$158.1 billion) annually, said Daniel Zhang Yong, Alibaba’s chairman and chief executive, in a conference call with analysts on Thursday.
In the three months ended December 31, Alibaba Cloud revenue totalled 19.54 billion yuan, up 20 per cent from a year earlier, on the back of robust demand from the financial services and telecommunications industries. This segment contributed 8 per cent to the group’s overall revenue of 242.58 billion yuan last quarter.
Alibaba Cloud recorded a 134 million yuan profit last quarter, recovering from a 221 million yuan loss a year earlier, according to Alibaba’s financial statements. Alibaba is the parent of the South China Morning Post.
Cloud computing services enable companies to buy, sell, lease or distribute a range of software and other digital resources as an on-demand service over the internet, just like electricity from a power grid. These resources are managed inside data centres.
Alibaba Cloud, which offers cloud computing services in 25 regions around the world, is relying less from major customers in the internet sector, as it pursues business in other industries.
