Alibaba Group Holding Limited (BABA) 17 Nov 222023 Q2 Earnings call transcript

Good day, ladies and gentlemen. Thank you for standing by. Welcome to Alibaba Group's September Quarter 2022 Results Conference Call. At this time, all participants are in listen-only mode. After management's prepared remarks, there will be a Q&A session. to Investor call Relations like Lin, to now of Head of would turn over the Rob I Alibaba Group. ahead. go Please

call Thank replay and being the our Chief CEO; Financial Welcome our webcasted everyone. Tsai, Executive XXXX from With good This of on Toby Group's website. will Joe are website corporate and Xu, Chairman; us Chairman quarter be call. results of call to Zhang, IR today. Daniel Officer. the section Vice September available A conference you Alibaba day, later is also

quickly discussion me statements. let cover contain Now, the Safe Today's may Harbor. forward-looking

Forward-looking statements inherent and materially differ cause uncertainties that involve results to actual expectations. risks our current from may

a undertake except on on US risks under Hong note not filed detailed ADS, based of EBITDA, the statements on assumptions Form statements, uncertainties, basis. SEC per a and Please EBITDA we adjusted law. this measures and report discussion such of flow make and with and EBITA, as certain adjusted or Exchange. EBITA are margin, expressed call are on Stock income, to non-GAAP adjusted other net that non-GAAP any margin, diluted the or documents do of financial refer we the website this applicable on today to announced the please forward-looking we For Any that update XX-F that Kong adjusted required as non-GAAP our annual share, as use obligations on these earnings free latest cash call

metrics during year. same versus otherwise our our year-over-year to GAAP found stated, this earnings Unless call to release. the Our non-GAAP stated GAAP refer the measures on of of last results growth all rate quarter be and press reconciliations growth can

refer A addition, translator Please provide today's another for will Chinese third-party English. prepared will in conference management translation line. our details. their to press on In simultaneous give remarks release during call,

the case any and language With questions provide the translation. in Daniel. third-party in convenience the original will statements All that, consecutive Chinese, management both for During translations English will of and session, take discrepancy, we to prevail. I call In are turn now translator the will Q&A the will only. purpose

for Thanks convergence EBITA solid a Despite joining of ongoing forces in of resurgence uncertainty. these delivered increased earnings Thank today. We stable. This remains the challenges, you as traffic low market, considerable environment pursuit call business consumer a XX% everyone. Rob. single-digit but operations. our all Tmall quarter currency of of and year-over-year tension, difficulties for Alibaba's geopolitical full the depreciation, Hello efficiencies. is macro non-GAAP enhance In that the our created more demonstrates The inflation, year-on-year user these saw GMV quarter, result and Taobao importantly, of business operational high-quality of development the the we domestic our and this China resilience continue COVID-XX, to Alibaba ecosystem. decline a the

operations and appetite suspended was weak in experience. frequency. This in hurt a The consumer logistics of drop consumption resulting logistics has service different in merchant However, COVID one abnormal another, saw affected resurgence area after or and places. we purchasing

results is remains this In we terms strengthen and one, health now or execution quarter-over-quarter. care consumer categories, as categories, entrenched work by population continuing ensure our After many decline DAU our user categories, positive positive of operation, Interests-based to our users' Taobao, user stable. traffic wellness-related years relatively mind Tmall as and of shopping a such deeply of MAU the following the strategies. in recognized as show pet and committed recreation Number demand, destination. to engagement. have in growth. apparel the and environment, outdoor, electronics, such In we achieved slowed challenging

consumption streaming and interest focused and highlighting of the and journey of discovery We stimulated means further decisions communication. customer on the that Number two, purchase enhancing scale group. our across video, by the recommendations, we most engagement other engagement consolidate search, by through short-form algorithm-driven conversion and texts platform stickiness the factors are photos, user consumer influence drove live We features. our on other valuable

For during improved quarter, and the service services and with retention Number satisfaction we ended at of in XX,XXX as solid over XXVIP contribution. on customer required. population membership orders around number December consumers three, remain continually the delivery of and doorstep consumer rate million such XXX logistics growth with RMB months held XXXX, who experiences, the XX spent million retention service GMV in XX, a and investing Tmall by Taobao top of each membership on steady XX%. as XX this after

Our latest consumer relating satisfaction post-sales. and logistics to survey scores showed improvements in NPS

a line recent More than the XXX single-digit our million in XX.XX Tmall's total of November was period. during the last strategies performance now during with outlined GMV and year Global just year-on-year. related engaged were During XX XX. contents, Shopping same operation our Initial growth the seen November Taobao with fruits Festival, users

to buyers average increased. compared year, same number the total person the declined the last per Although, of GMV period

As the for the continue our XX bought than grow. to contribution total during Moreover, XXVIP GMV our November something XXVIP of by members more profile, consumer season. XX members to

categories, and saw XX positive Consumer interest-based electronics growth. product season. what of consistent with quarter, we and November also observed and Regarding rest growth categories, categories, health such the outdoor enjoy pets as during recreation positive the during wellness-related

event XX.XX ability Number in And services. the an become China time But by much a suspended for and across XX.XX and This on ability – celebrated abnormal improvements. XX% environment make campaign a year by average that regular in delivery consumption nearly the even deliveries. the performance: are are delivery areas time that suffered. embraced appetite starting experienced our seeing apparel usual recently, the the weakened society. through for one, seasonal or period, that and category impact three, Number logistic impacted than XX.XX two, to negatively in warmer and on few of orders period the delay October significant COVID. there thus, an China had fulfill to we of However, company's impacted has apparel across Number merchant entire for change temperature factors more was

to the as to merchants they choices, were of COVID-XX, across relating capture consumer uncertainties opportunity the to take much offer both this speaking, online and possible Objectively especially offline. the keen channel. Given every more growth available as advantage

convenience in rate decline revenue accommodates consumer b, return fulfillment returns account handling three to user the in than on collectively platform. streaming-driven for, making increasing in c, the live impact rate rate platform. return contributed was These -- the If and reasons: would our in of quarter, rate was sales; a, order and returns. the it return like our the calculation reasons rise COVID-related of, The share of rate larger not overall This order order I consistent. due accounted returns because that the on order return a to take management actually does in higher Take GMV. across was decline higher first improvements delivery; is experience remain higher to the order

from views monetization discovery less take page was a but growth, traffic efficient, lower short in algorithm-driven of our rate resulting recommendations term. the Second, in

light for presence traffic long-term services better to take local on and to year-on-year a and volume app revenue faster and the there comprehensive it more and network and of China. and hotel This registered to by its In and and Looking value, includes XXX this order related continued same stickiness staying proactively has platform map It to of destination, introduce unit an continue on quarter, of User by out navigation, series service version in segment, Post stations, costs traffic order XXX,XXX Post strategy communities, of navigation improvement. cities. various the order a new growth. robust touch Day in and was user record school enjoying than to for forward, XD recharging now launched efficiency, rapid the car consumer million has EV grew important has enhance city so in together users focus leading due top Cainiao to of retention adjusted its the with offered saw the time, level on stability to we population new in this the continued economics the Amap see a XX% rise both in will change villages mobile in it increase and operational its growth key historical to of for forth. business map, shade with our so Cainiao's serving including rate. new become sun, during road across of the composition fulfillment. the our cost services Amap, DAU to improvements failing, and in efficiency. its coverage business ensure monetization Amap the a logistic and were features, and reduction the products development, quarter station our consumers. week to of growth primarily rural growth clear continue a Ele.me, getting campuses locations. lane an is experiencing adapt strengthen which navigation, user operations On gas National At all its in holidays. booking, forecasting market are road Amap grow and Cainiao map point average residential to in in signals,

order the Southeast on volume restrictions to the to network business costs resumed. its and of Trendyol’s year-on-year US strength has dollar XX% Cainiao export build currency service. business, year-on-year volume rise over and consumer efficiencies. contributed AliExpress. the and service XX% fast-growing volume order offline of continued logistic deterioration as local other year-on-year in logistic declined for nodes order were For capability and its a Asia, grew e-commerce lifted X% overseas inflation logistics actively declines against market, global overseas enhance due further our markets, hubs and cross-border COVID-related to In shopping In in

investing For are business user just than taking to our and model adjust we value scaling. creating in steps AliExpress and rather Lazada,

cloud ensure overseas serve our to logistics development resale business quarters, of we strengthen of growth Alibaba structural capabilities few revenue that in past market. been X% Cloud's pursuing more We now high-quality interest supply in capabilities the our the continuing consumer hosting investing while the sustainable. In adjustments the growth, revenue these hybrid are be market. only structure year. will Public developing digit has that this cloud to segment, and to Cloud believe that long-term revenue development also Through We the In commoditized declined. year-on-year our and chain. in control is healthier the double Alibaba our was of meaningful abilities infrastructure sustainable this proactively and year-on-year quarter, Cloud over grew

Looking Its to services. revenue financial industry. total XX% XX% XX% contribution revenue services, industry sectors, Non-internet growing and quarter-over-quarter. The revenue by increased public to including our fastest from telecom year-over-year. grew at automotive,

the for partners and CIPU its capabilities will named significantly serve Alibaba's China's such in At and Cloud and solutions infrastructure relevant reduced processing reduction leverage under development. November, Conference Alibaba In ModelScope. to cloud processing our as cloud industrial efficiency open efforts wide-ranging source Ele.me, launch Taocaicai, These industry digitization. Businesses ahead, a It unveiled their proprietary measures Apsara beginning platform of included Model-as-a-Service Looking cost of to in i.e., Amap, achievements. important an will bear uncertainty, technological unit, improvement Deal, our early are many Lazada computing advancing fruit. and future the Big this have range in environment, full we losses. Taobao with purposes cloud Data important Youku,

business improvement and term value growth in to the provide continue on user investing core building of scale. to rather focus customer steady on will or business pursuing than quality capabilities short We

enters China of of also high-quality business operations. high-quality enter we area stage As a will development, an

during times years is of what Alibaba's today same in revenue XXXX. the from it September period scale quality XXXX. XX it in has X.X times our same was XXXX, the the in IPO during times, was period was XXXX. is significantly. cash the X flow improved and what in eight Adjusted business is EBITA the Free it Alibaba's During of what that

Over to in China's RMB GDP past years, trillion the almost eight RMB XXXX. XX doubled from XXX XXXX has in trillion

buyback continue we share program. are confident future, about and execute will our to We the

US$X existing US$XX As have utilized of towards repurchase program, date with under share billion billion billion we more our US$XX to go. November approximately to XX,

remain can has matter our ups upsize our repurchase We to more the action billion In us about future, another by even towards and confident tangible authorized share about Board return. no We world. prospects and downs. Alibaba's development. program enhancing US$XX as are of economic important the aligned believe role sales our a social believe process We addition, existing China in Alibaba shareholder the goals. digitalization the goals China's highly development in China's and with the long-term an believe and We play around in

from economy, commentary will, our adjustment society, return latest in of our our and government the relevant digital development policies the eventually can of make contributions COVID of massive the related businesses. unleashed. towards economy not we China, better potential and further note world's believe believe the China's and platform that Alibaba that as taken least, of economy but And employment ultimately, part to of platform lives. Last pass will everyone. businesses, that have COVID that We economy regulators unique pursuit We second small medium largest proactive lives you, serving and and will and promoting valuable Thank normal. about is high-quality and creating be

the the to financial Let microphone share me results with who pass you. Toby, will

Thank Daniel. you,

start the quarter. with financial me Let for highlights

RMBX.X driven compensation RMBXX.X of increase year-over-year. an an operations share-based increase This increase of quarter, an our billion, billion. billion, RMBXX.X the year-over-year by Income or mainly billion, was RMBX.X of X% expense RMBXXX adjusted XX% in total in quarter revenue of EBITA from was decrease for billion

During performance making XX% in of improved that three Overall, by costs efficiency year-over-year improve businesses continued XX%. loss increase points to percentage the our September EBITA enhancing quarter, and operating EBITA by resulted margin to RMBXX.X to operating we billion. adjusted optimizing adjusted have in

a trends excluding at cost stable remained of revenue, SBC. in look Cost Now September quarter. as at XX% percentage ratio revenue the let's of

contribute Our and our our traffic, by two quarter. spending expenses to points ratio ratio direct logistics results. primarily during marketing equity was increase an EBITA, to in ratio increase but reflecting our logistics, income administrative efficiency. year-over-year, Product expenses to driving subsidy retention optimizing our expenses user decrease and keep remained to sales decreased cost adjusted RMBX.X percentage businesses. optimizing X% across mainly acquisition year-over-year investees stable, General revenue inventory RMBXX.X services in through the efforts at XX%, development of in businesses offset and and ratio of our were user Sales we up method cost in able stable September pickup improving acquisition of equity stable and and due Non-GAAP continued billion partly remained of billion, net a quarter. grow,

decline Our value changes RMBXX.X a equity offset loss of increase investments, primarily net billion GAAP in net in in by loss from non-GAAP was year-over-year, fair billion, of increase partly to net the RMBXX.X our arising due income.

XXXX, we of net billion. As maintain to position of a XXth, September continue $XX billion RMBXXX strong or cash

is down operating net were cash respectively, operating by free and flow operating period investments generation. acquisition a Our the healthy activities year. In difference for RMBXX billion cash strong to RMBXX to flow cash in free RMBXX RMBXX net position between September a of billion billion, by which inflow up cash billion Net XXXX RMBX.X significantly billion and billion, quarter, compared and flow from and same billion was is supported ago. disposals cash billion from year CapEx were cash last at of flow versus by ago. cash reduced outflow RMBX.X the versus RMBXX RMBXX.X activities, year Majority

sustainability long-term have the repurchasing the aggressively. shares in have our our Importantly, given on we conditions and current of we market been the confidence business,

our cash the XXth, equivalent ended XX% repurchased to for million approximately XXXX, we fiscal program. have another period. first Xst about during share XXth, which of to billion, our XX.X approximately on flow $X.X repurchased November is ADS ADS we $X.X half From in our billion of For repurchase free October September

with confidence. to cash flow program this repurchase share strong Our free and give flexibility us execute sheet the balance

goods quarter Tmall results. year-over-year was look Customer RMBXX.X composed commission and let's decreased declined Customer of revenue advertising low Now China revenue. and in commerce management paid GMV of RMBXXX year-over-year. physical X% at decrease by management from by billion. to X% segment Revenue is our second a Taobao revenue September single-digits. billion,

Health’s X% as observe return positive consistent order billion, while growth sales by grew driven merchants, search Taobao advertising of provides paid it impacted is and revenue advertising, the others than reflected advertising EBITA during and quarter. improvement RMB percentage RMBXX non-search for Freshippo, declined points reduction X increased The segment RMB to EBITA macro margin conditions Segment growth businesses. in continued in RMB Taocaicai Alibaba -- sales to more billion revenue September higher basis, to loss due billion of XX% X.X quarter. significant this which, primarily also Freshippo GMV XX China Commerce strong improved Taobao Deals, combined overall billion on direct from year-over-year and revenue negatively adjusted and cancellations. by Tmall quarter. the other Commission to that reached Within our factors. Direct to by X.X

into Secondly, types margin three be can segregated businesses. further EBITA of

continued business, stable year-over-year. and marketplace Taobao EBITA margin to including Tmall exhibit existing our First,

Second, combined quarter. have cash Freshippo businesses, flow Freshippo’s by stores of majority achieved was driven continues which the EBITA to direct of positive. existing improve, during primarily margin Vast our the sales

new mentioned. Taocaicai significantly reduced and Deals previously businesses, Taobao as including losses Lastly, year-over-year,

quarter generated the billion. has as X loss transactions XXX of reduction RMB improve operating that led X% to completed narrowed in enhancing by significant on value-added adjusted year-over-year losses efficiency. September International was The Trendyol retail business billion, increase increased segment as Commerce services. rate challenges billion. strong result X% EBITA Our and over Revenue to by RMB was order billion depreciating by its primarily Lazada increasing year-over-year. in International order demand Europe RMB was an a a cross-border monetization to reduced from offset as Lazada primarily contributed RMB revenue by result million continued AliExpress well from as of in by increase RMB in X% in X.X XX%, of to a XX.X quarter. logistics The Trendyol. our International loss resilient faced growth growth Revenue Commerce September to grew XX.X segment and of from Alibaba.com due increase X% driven by in was challenging an to of -- partly Euro decrease value Commerce e-commerce cross-border costs. wholesale Alibaba.com to in increase revenue related the primarily The due business

quarter, narrowed the order period loss over per XX% to compared for same year. the During by last Lazada

a well headwinds While strong operating combination improvement enhanced Trendyol's as efficiency. of is growth, ForEx despite revenue as

to Consumer and XX Service customers. experience service cloud more continue accelerate, loss this for mainly reduced RMB revenue growth segment billion efficient of drive year-over-year X%, strong September the as EBITA of to was growth industries segment services, business. an by improve demand Revenue education XX% billion, Revenue was Revenue our that adjusted of to XX% as revenue in of grew Youku, a services Cainiao’s value revenue entertainment DingTalk, quarter, from year-over-year. XX of hybrid XXXX public revenue increase of result an industry. offset quarter, Internet use million due growth. adjusted revenue cloud by XXX economics comprised industries growth of internet China has Local driven domestic from quarter, Amap industries. after Our remained contributed revenue reducing after from Pictures. year-over-year. our segment, driven upgrade quarter. by order million services games X.X using Revenue was EBITA customers Alibaba XX.X an in and September in RMB was primarily from by RMB higher in spending. partially our as revenue. offset as Ele.me. also partly logistics online from RMB RMB Online while to XXX XXX Pictures, by of which elimination, from and RMB a other decrease by the quarter the total its year-over-year X%, well Cloud of revenue reduction also Cloud consumer which user revenue RMB XXX EBITA UE recorded and digital declined order to In increasing generated increased a that primarily mainly losses. Most the declining average growing narrowing customers quarter, inter-segment internet enhance XX% of the billion, by to interest from in its consumer overall Alibaba cloud customer year-over-year was profit Adjusted Ele.me, cloud value, Strong September recurring revenue, segment increased. elimination contributed increase year-over-year, by to media reduced continue EBITA fulfillment solution and of million improve revenue healthy billion, stopped telecommunication million Amap Cainiao business profitability high-quality of internet we by of customers positive improved non-Internet unit was from driven financial driven of industry growth, of grew a RMB profit was delivery Youku Cainiao RMB driven per and gradually cost of to RMB primarily RMB from external public for rest softening in declining the service business, of September the since service order billion and primarily XX.X in revenue. of reduced continued losses contra-revenue international loss and segment September million increase overseas services top international by Local XX% in million was to driven later Adjusted September Alibaba increase model Revenue Amap by well customers about XX% XXX XX% loss other businesses X.X as increase cloud continued RMB from optimizing quarter was as billion. recorded of by per that Its order by subsidies were Ele.me, average X acquisition in in

quarters. Youku been continues consecutive capability. disciplined to investment losses for in production content through narrowed operational improve six and efficiency have This year-over-year

we several listing preparing Over months, past the been for Kong. a primary Hong have in

account monitoring including During into are conditions. closely factors, other this changing process, external and market various we and taking

shareholders our of of interests planned. company complete new the we long-term not will align of the ESOP Kong, amended to newly shareholders. to a our approval with the Accordingly, conversion in as ownership to the also end program comply we formulate Hong Before and The with employee XXXX rules in primary listing need before our Kong. order continue the to primary program in Hong for new stock submit to development our initially will conversion

wrap-up, process I've I to factors We this investors shareholders, course. met many our will your since I've CFO the year, all evaluate role and update To due appreciate of up various this in feedback. really earlier during taken the continue and

I We As unlock and communicated important consider we allocation execute proactively to to three of our capital intrinsic company's factors. create have strategy will many you, our value.

Firstly, we will be focused.

to we'll strategy, We We growing our also prospects businesses long-term three confident and but execute are to pillar leading our prioritize profitability growth that our of in will businesses, of continue of growth remain many players only improve growth medium which not profile. the revenue their respective markets.

to will Second, the of resources, in our optimize be less more monetize in and order investments capital activities, we M&A selected continue selective value to strategic unlock subsidiaries.

Lastly, business we to long-term better interest want align our the to of our shareholders. performance

XXXX fiscal of half year around XX% cash of buyback. period, have each first flow and to XXXX deployed we free During share fiscal

repurchased we US$XX existing and program. our our US$XX November XX, of XXXX, share of approximately billion had billion repurchase As shares

XX our program billion unutilized attractive, the Thank program. to repurchase to during program an extended period long-term of you. and and our addition, repurchase ongoing XXXX. Board USD by share extended In of of our consistency program hope March have our extreme the of We US$XX will Currently, this consistent deliver Directors return increase through market another has amount shareholders, end existing approved billion, share volatility. repurchase especially upsized we and our

Q&A. to turn let's Now

Hi, everyone.

purpose address questions for the any your you in questions consecutive is Please in interpretation the are the our language translator prevail. in will that, management you welcome original convenience will Chinese translation statement Q&A only. provide management third-party In A for English. language ask today's will note session, and discrepancy, or to the of case For asked. our call,

If website one [Foreign connect Operator, the our when and be will please speaker meeting. now Q&A you. on SI unable and lines please you Chinese ready. a after Thank the the of week the transcript call are hear within to conference Language] available lingual translation session start

Ladies now question-and-answer time. yourself a at you. no ask question questions, and we To Instructions] to one more please keep begin will opportunity [Operator the Thank to give more session. the than gentlemen, people

Goldman go from Sachs. Please, Ronald question from ahead. Your comes first Keung

[Foreign XX Language] and noted My Daniel, prepared and stated with We during was customer year your and remarks, do Toby consistent Rob. of to Thank Double question you, that Joe revenues you GMV has management with GMV. that in last year. this

your But environment, there's improvement us from it the revenue? So in to stabilization may seems the as also can drop and the GMV CMR single-digit September looking grow several anticipate view next more you of quarter. how we forward share the macro an in there quarters the with

been Thank of purchases as the in the in you. of and comes detailed which And platform. increase to on way changes I of some ongoing rapid are particular, my there an on CMR understand the in it returns in interested. to well sold Well, issue of goods in an context impact the the issue. I live that Language] in [Foreign investors earlier, fact, has when Certainly, as consumers, and in overall prepared with is pandemic, are of marketed streaming growing ongoing analysis importance this the offer live did do GMV the streaming, impact

the we about But pieces. when do talk that about typically, with talk differences the we are some there issue CMR, So of conjunction two returns. between in

comes when post-return it talk rate, all, to CMR, and that's about GMV. First connected with we of take

that make of to secondly, help own consumers this result efforts a Language] the terms their as of but amount our that, merchants' on reduced on part So growing impact in and there's merchants we really merchants correlated of on the business. revenue be highly CMR should be well sales. to in own the advertising willingness engage the the focus of piece second returns macro revenue platform all with environment the better invest, as the macro environment, will of But [Foreign and is current drive certainly, on

better with And sales. result the be to search very smart can recommendations that consumers achieve has achieving paid of all and terms of we their very streaming lately. engage in grown it our ways their be different merchants familiar, are CMR drive to So enable which recently should and is that rapidly more live merchants in and for, revenues. These success that everyone reflected

next Operator, question.

Please go Jefferies. next ahead. question Chong you. from Thank comes The from Thomas

performance logistics on [Foreign earlier regions several Language] noted various XX. side, year Thank during China. factors in affected some management. Certainly, you, in that we Double about there are the spoke Daniel this disruptions serious

you So, the December at pandemic. live also order ongoing at the related quarter, one just I'm these them, the to impact to of factor wondering, as also of rank looking would streaming, factors, cancellations impact if consumer sentiment order how and looking you're different going

very If of you're those China good like? commerce order with saw then that would EBITA the that were we going importance, order in what factors side X% secondly, increase in a there. And of terms to on achieved look results

in ongoing I'm time? a big if CMR how at the have impacted wondering Thank could these be on more basis the factors, macro short-term, about to if that you. could impact talk So by you an on an expected is little

[Foreign Thank Language] you.

demand, continue that XX offline. and do consumption some the with players the of both disruption format all things country. introduction ongoing a in we think direction. would environment platform, those situations But but those has -- be of the in enterprise relative on piece Alibaba, or streaming is Language] But would regards to an consumer authorities factors for you to [Foreign overall, an impact I for any determinant or three expected impact. be online As state and of with impact, to think from you Further certainly to say And the to willingness them, certain more improve the this consumer have impact just summarized still certainly important which, primary true question, the is, spend. if but returns. macro factors resulted expect is the would then that positive they We not mentioned, that And but an all do I change. live process a to ourselves a becoming on for your flux had to measures would in, find positive can has the that it macro I consumer second this of regions the space, on we impact any have logistics not confidence, in be to be turn, three the dynamic environment I the in as engagement in rank absolutely in

However, just I on its especially Alibaba to streaming, the live rely is on I rely compared or who those smaller. peers, think Alibaba streaming on basically relatively live impact think primarily

it But we XX.XX regards to to During to costs the goal different to the especially a format with But is during Alibaba hard for in live have more one engagement to Alibaba format our that is ensure working kind for the that that open of do year, in everything embracing that -- ensure and does to periods new important merchants these do consumer streaming at general, Alibaba a balance presales good on is played represent doesn't the period, and to need formats acceptable streaming regular XX.XX. experience we that. be offer. and want of consumers with of Alibaba one they remain the to to to ensure technologies to able their approaches. and new the able that are engage also ways end day, merchants. live

finding right balance. about is the So it

commerce the second Look, do add on to impact China at have like to question, forward. would, I'd with day. regards revenue, going on the the stream This is to a CMR your profit reduction of profit the in an to of which with any impact end revenue in reduction had potentially course, Toby. of that

of up. increase levels last we've at year. year-on-year However, it in efficiency. driving was disciplined EBITA to quarter and by same very And achieved the China this investment in compared commerce if that our you spending a quarter, being also in higher and look was There positive

business, has Core EBITDA losses by in profit as in been So of of this increase well driven the narrowing that an losses. the parts the increase in in we're achieving making parts Commerce as profitable by

that you around of why that's X%. see increase So

question? Next

of question The Leung Merrill Eddie from Bank from is America next ahead. go Please Lynch. you. Thank

I'd as evening. restrictions? then different question. large that, And I'm that And going or if future change itself to be that to pandemic in Good you. negative? hypothetical in impact a might be China, major related be types? if, wondering better for position relatively a Thank Thank prospect could or control adjustment Alibaba impact a you. preparations or like ask any forward, measures there there kind to would of is how positive on making pandemic of adjustment would company product are a the businesses different you control in wondering I'm making

lives. that news Alibaba be for good everyone. see it what for our own would very very nothing be normalcy much to to get the back to is end would more question. for all sure the economy, and for There's good to thanks a daily for pandemic than people for Language] we an [Foreign really hope good will want that, normal, Well, news a I'm complete that and Certainly, return to and society,

diverse our part the Alibaba's impacted businesses and ways. consumption are be Talking of certainly, in would first. different business Now about

I companies future were return boost a confidence growth. the big to and as very be Alibaba. work, need in they pandemic consumers including an to But there would confidence, they economy end own – certainly of for spend, the their would stable expectations, an consumer be in engine normal that Chinese that and particular, regarding importantly, stable to a Consumption important to for most think to to and result for income. normal a a and to like positive life economic have is whole expectations also need have complete

So the result in we're kind big confidence, I that controls of further boost spending and that consumer end, resulting believe, end pandemic would, the also to a economy. to stimulating to higher in the

good news So around. all

of an supply course, a access there's you of things daily of demand say with lot Secondly, about been the on that stocking essentials. and uncertainty, consumption groceries, focus worried essentials, you've, the nondiscretionary I disruptions, seen on on expect to lack an this mix would of with impact And to necessities and the nature. food, for potential of people up all consumption in see could context the pandemic increased

So to of a up. demand people lot stock for

could to course, to then were in I of you see think were the the certainly Now, of pandemic spending. ease, situation change, increase expect corresponding discretionary type a to

So be we would change expect to a see. could that

example, at if XB for look Secondly, computing. we our cloud our businesses,

think they expectations time, much same but to how that future, at digitalization the all their and down the future. their board performance come period business current own is does of across I the the certainly, understand enterprises will invest any in

be to their to sure within to how they're So they're invest means. have companies living much and they have willing decide

I things prospects confidence more would over, to companies normal, have more is digitalization. and resources being think, we devote growth to returned So, the gaining expect future to after pandemic in willing to see their

be for I think would good our news that cloud business.

So course, the for Alibaba, I of future, that do hope to the always hold looking important out future. think be we it's and for

complete At offerings, continue look the forward and to time, new going the to will categories services. rolling their In very already terms out also digital to extract categories to including at of developing customers and help we a goods, proactive and will oriented cloud same and to but the new consumer and forward forward. data our going very not empower services, and of pandemic and rolling and tourism we're from we end data, solutions travel based developing maintain to be approach their offerings to this value data. need think continue that and to generate positive all out I solutions And just leverage

you. Thank

question? Next

JPMorgan. is question Yao ahead. from next The Alex Please from go you. Thank

in aligned including can that how what, out returns as regulatory say, in you part overall digitalization. China in process Daniel, can reap? of kind your I'm terms is you. direction, years you. five see of Thank in context digitalization next current its spoke playing long-term Language] of its do [Foreign in Thank and the and Alibaba China's in terms Alibaba's direction, development the how with in the around environment, of global Alibaba development highly you future, financial strategy wondering, the of, long-term about remarks, pace? What prepared

given globalization. big emphasis we of important Congress are, [Foreign helping strong those of industries internet view very of the it of latest the course, of with computing, with course, into is committed Alibaba's China the comes strongly And economy. positioned the of XXth our to cloud think Party -- in do well realization And note develop the key strategies the contribute when future, digital future, Language] the a Well, I strong a goals. intention Alibaba we of picture to three the player and that to consumption

thing digitalization in in goods and digital enabling as around internet, a If you real was the consumers the field way. with Alibaba's flows at we consumers company commerce economy, look to of retail that back history first did the serving

years, we delivery was only as cloud as quality management just logistics, second possible when five then ship very And we've over in country though country. in today also not bring high not all investing is now and effectiveness with China public comes and services of the computing the one number in services, focused thirdly, it The thing as high to number the in the companies, parcels, companies XX fact, well. over the to helping enterprise express but as efficiency goods digitalization did it terms making world of to digitalization to of probably well, the been the digital, And last well industry. services on go of

is this served computing of our All offerings. by cloud

to harness we're precisely as that will that China to value And to aligned the ability the real tremendous digitalization technologies the with continue of confidence process do empower to do create development has Alibaba, and of process. our a company, overall in digitalization. further that, this a that empower indeed this So, part as through long-term to direction benefits provide we economy going highly digitalization feel to in company, as forward, of

other encouraged from of and that feel we about looks high-quality So direction, have we overall important economies about in including we seen developments platform and that do are development and that going authorities, policy positively forward forward we've to go. also comments state an the all playing by of confidence Alibaba very role these encouraged talking

Okay.

Next question.

from The Liu next go ahead. UBS. is Please Jerry you. from question Thank

could, quarters back, like what tell about view say is I'm take we or which to addressed to monetize good year, please, earlier [Foreign ability Language] to management we Thank you discussion, few a the next traffic? come us, you Thank rate and company's the this the your monetize over wondering if in could if I'd the you. was to topic the next and ability evening. over traffic. the company's

not and part ROI. a take that how [Foreign we our investors, it's merchants enabling really -- taken can traffic isolation this. how we merchants, That's over topic to we've to more Language] Well, topic question achieve objective of and -- interest, in alone we this the then and but and the all on is we it's years, really course, create that basic share of about of value ROI perennial -- look many one on questions about at monetizing of for to to basic merchants our it help

to when the purchase. of example, interacting that app way Mobile app, you at with diversity Taobao for different terms consumers look today, routes more Secondly, in are our, there's through

earlier my and a discovery well recommendation functions, have smarter in other mentioned remarks, of videos are smarter as you I search kinds As becoming of all streaming live including short-form and and as course, you feeds that. that and have, of now

reliable it them to formats different we interactions on connect us of with monetization consumers. new search to by new those helping discovery-related these So but behavior end recommendation, model the are formats in of traffic the are end of kinds providing looking day, scenarios the consumer frequency merchants for structural and concentration or But will, terms at represent help other to course, the going behavior it's to evolution. ways it's change monitoring about But kind with underway or create in for service formats, a of And we consumers, and consumption. and PVs tracking in and commerce around changes consumer at side. consider are of of to helping merchants, and at forward, line via this be the around a a the day, and videos still the about effective serve the those really value the can of by that

Next question?

Alicia next from Citigroup. ahead. you. The Please go Thank question from Yap is

the advertising, you pandemic terms if in Thank Language] that us bit to changes the period in of marketing long-tail the a months, little you before of I'm few compared brands, [Foreign about there budget then the first could wondering, may and big Good in against all, have morning, brands management. talk seen and allocation large you. particular, past merchants.

would wondering, versus way, For the formats, different brands can be if be convenience because example, to take live and paid streaming the by merchants merchants smaller recommendations. live proportion those budget example, on more and marketing versus know Daniel big about the you. then, take as streaming bring formats one And I bit the But for talking other than format that to search a one like was to the if about I'd us rate? were rate could allocating rate you happen versus recommendations format. what to for of take follow-up, streaming of marketing more search live for or tell lower to Thank

[Foreign you. Language] Thank

of into pandemic of context this divide the a Let this to of And I few me all and When merchants, large, medium considerable budgets. pieces. the uncertainty. it kinds is true or think comes marketing small in

revenues, I be is expected in a year. think budget their marketing of spending because certainly it large, that medium, become or to its allocating a be be all small, on future going size, prudent a categories its more merchants it a in have company, with of percentage as quarter of regard marketing, to any regardless

all companies So heightened with course, to uncertainty of expected revenue, pandemic, of in going an the budgets be impact there's on of kinds future context for the alike. marketing around

around higher I being paying a prudent. and ROI, demands is think you function seen that that have They advertising of merchants to secondly, paying the ROI. more we following a off change effective the pandemic in being also -- is for of that they're want ensure terms

is, are display a platform the major by approach, a merchants in place be operations tools a pandemic. more brought sustainable of a variety operations can and looking why and the the to the come consumer that achieve well more a things to come empowered advertising. Taobao certainly, like continued Alibaba uncertainty for and cautious primary positioned all to business that. whole -- success course, So, especially and amidst for of with ongoing different business. of also very It's and for China. do platform merchant advertisers Tmall place that's And do merchants be about certainty as to media the both Merchants,

end looking sustainability and to for the going incremental and they're new new they're new will gaining because Now, of crop investment of that are the business. be But up, growth to of ROI they always formats, platforms their that merchants at explore in incremental matter, at their course, the day, achieve new models in always the achieving looking business.

We'll Thank Okay. last question. you. take the

Sorry, complete. Rob, just to

Go ahead.

Yeah.

question, rate live take second part the had on Alicia, of streaming. do with your the to So

Alibaba of So live first streaming. two kind merchant kinds has is live streaming, different the

So running live this and we something at the in Chinese online that And employee, is other that's have or their they unique to where have on with you can call to Language], leaders own have the to growth opinion agreements a incremental in engaged by and by they're revenue them merchant streaming stream, And third-party via promote secondly, live rate. an then Alibaba. a store, live store person streaming doing merchant sharing ensure visibility we we give we're an take merchants. which place a [Foreign so

So that is our model.

Okay. please. Last question

comes The Jiong you. from final Thank from question Barclays. ahead. Shao Please go

has very expand us revenue for reasons some very Cainiao's external, is that that the given Cainiao? about My in over a a total spin-off robust performance Thank bit a you. much. growth? on we also [Foreign if of about Thank you that Good with very prospects to you potential talk good of external management. are over if that XX% questions And talk so to Language] and evening, could this by us of XX% you generated performance growth driving customers, could of with now being had quarter. have which the to I'm do Cainiao, revenue, see wondering

you. Thank Language] [Foreign

take and question. the over question Toby. is I'll this hand Daniel second So, to on first

side this not the services on revenue services and I strong PL that, was improvement, So well. script, a good increased and my in in on growth then side, is the and the passing and meaning consumer the us think that turn in providers consumer more model for taking China's on With revenue some XPL that largely but responsibility as model, this just so for contributor satisfy into to in better In reasons at Alibaba I China. for providing the year-over-year. secondly, reflected the local in regulatory an the we more into where customers, and been growth from are going recognized to we by this space. requirements logistics service. did upgrade different more and I purchasing side be model, cross-border biggest booking model. XX% thanks service to yes, indeed, very to able we're revenue achieved quarter, for logistics enhanced service But that are we services go that can the an We're about able those also rather to to talked from time, consumers, overall on customers provide our have domestic to enabling services in and services to our provide improvement same better And

family, you. has Thank established providing back Daniel Alibaba the Ever XXXX, in second operated This the Language] more well. independently question. importantly, with since within services [Foreign regarding shareholders is as it Trendyol and been was but external external

owns Group of there and Trendyol, investors Alibaba the are today, as XX% So well. some other

capabilities. Trendyol building robustly on last-mile its stations in around in all well. also developing up and cross-border robust very has delivery Trendyol logistics capabilities chain domestic as Over invested campuses, the Post villages years, the supply with in country and

success commerce of business, development, capabilities in be in achieving continue of look forward far And broadly as the be businesses. our to building So it synergy into see in commerce to is better domestic and this to growth will really business, continue the back course, those as robust turn we that and Alibaba's we for independently it of market. be Certainly, operating our Alibaba capabilities very as XC, well. drive concerned, achieve seeing important international to feed terms XB kind Trendyol is those across more Trendyol and a as market the well in

on call. you, transcript IR the in and website. free Today's Thank for any follow-ups. me have everyone, call, corporate we'll to for out today's Okay. team -- participating feel available later a reach Please the earnings on our to

will you you. quarter. next We see Thank

Thank participating. you. today. our That conclude for Thank for conference does you

disconnect. now may You