Is Alibaba Making Money? — Market Mad House

Daniel G. Jennings
7 min readOct 1, 2019

The Alibaba Holding Group (NYSE: BABA) is one of the biggest success stories in online retail. Alibaba reported quarterly revenues of $16.815 billion and a quarterly gross profit of $7.589 billion on 30 June 2019, for example.

Astonishingly, Statista estimates Alibaba’s platforms had 674 million active online consumers in 2nd Quarter 2019. Remarkably, that number grew from 576 million consumers in 2nd Quarter 2018 and 279 million active customers in 2nd Quarter 2014.

In contrast, there were 2.63 billion visits to Amazon (NASDAQ: AMZN) between February 2018 and 2019, Hostsorter estimates. Unfortunately, the most recent active account estimate I could for Amazon is from 1st Quarter 2016. Statista estimates Amazon had 310 million active customers four years ago.

Amazon vs. Alibaba

Alibaba’s numbers are impressive but small when compared to Amazon. Amazon reported quarterly revenues of $63.404 billion and a quarterly gross profit of $27.067 billion on 30 June 2019, for instance.

Thus, Alibaba’s quarterly revenues are less than a third the size of Amazon’s. However, I think Alibaba still makes impressive amounts of money. In particular, Stockrow gives Alibaba an operating income of $3.603 billion and a net income comparison of $3.109 billion for the quarter ending on 30 June 2019.

Interestingly, Alibaba’s income numbers are similar to Amazon’s. On 30 June 2019, Stockrow gives Amazon a quarterly net of $2.625 billion and an operating income of $3.084 billion. Hence, Alibaba’s income was slightly larger than Amazon’s income.

Alibaba is a cash-rich company

Alibaba is a cash-rich company. Stockrow gave BABA an operating cash flow of $5.064 billion and a financing cash flow of $657 million on June 30, 2019. However, there is no free cash flow for that date. I think that omission reflects Chinese accounting requirements.

Meanwhile Stockrow reports Amazon had an operating cash flow of $9.118 billion and a free cash flow of $6.475 billion on the same date. However, Amazon had a negative financing cash flow of -$2.158 billion on that day.

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Daniel G. Jennings

Daniel G. Jennings is a writer who lives and works in Colorado. He is a lifelong history buff who is fascinated by stocks, politics, and cryptocurrency.