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.