SAN FRANCISCO (Reuters) - Alibaba Group Holding Ltd accelerated revenue growth in the crucial fourth quarter, the company reported on Tuesday, a timely lift for the Chinese Internet company as it prepares for a highly anticipated public offering.
Alibaba’s resurgence helped lift shares in Yahoo Inc, which owns about 24 percent of the Chinese company and is highly sensitive to Alibaba’s growth prospects and valuation.
The U.S. company’s stock was up 8 percent at $36.90 after hours despite reporting anemic quarterly revenue and display advertising growth in its own business.
China’s largest Internet company, which is racing to prepare for the largest U.S. IPO since Facebook Inc’s 2012 coming-out party, recorded 66 percent growth in sales to $3.06 billion in 2013’s final three months. Its listing is the most highly anticipated of what’s expected to be a record year for U.S. tech debuts, spurred on by Twitter Inc’s successful 2013 IPO.
However, Alibaba had experienced several quarters of slowing growth as its torrid pace of expansion cooled. It posted its slowest rate of growth in three quarters during the July-to-September period.
On Tuesday, the company that powers four-fifths of all Chinese online consumer shopping recorded a doubling in net income to $1.36 billion.
Its results were released alongside Yahoo’s first-quarter numbers. Executives with the U.S. company told analysts on a conference call they would not comment further on Alibaba’s numbers, given that the Chinese company has entered a pre-IPO quiet period.
Alibaba, founded 15 years ago by outspoken English schoolteacher Jack Ma, has cornered the Chinese consumer market and expanded into everything from online auctions to messaging and payments.
An IPO could arm the company as it tries also to dominate the nascent mobile shopping and social media arenas. Market participants expect it to raise as much as $16 billion this year.
Tencent Holdings Ltd has the upper hand in mobile services, including in areas like messaging and games, the most important battleground for the country’s Internet companies.
In addition, Alibaba’s strategy of building a global e-commerce empire with its own financial services is attracting close scrutiny from China’s regulators and resistance from the country’s banks.
Reporting by Edwin Chan; Editing by James Dalgleish and Jonathan Oatis