Jack Ma, China's richest man, is in need of a little magic following a surprisingly poor debut set of results from Alibaba that wiped more than US$25 billion ($34.3 billion) off the company's valuation yesterday.
Just a day after a Chinese regulator said it was investigating the online retailer over the sale of counterfeit goods on its websites, the New York-listed Alibaba disappointed the market with revenue growth well below forecasts.
The company, where Ma is founder, executive chairman and the largest shareholder, yesterday reported top-line revenue growth of 40 per cent to US$4.22 billion - some way short of market expectations of US$4.45 billion.
Even so, with about 80 per cent of the Chinese e-commerce market, Alibaba is growing at a far faster rate than its US rivals, including Amazon and eBay. The total value of all Alibaba transactions during the quarter was US$127 billion, with 42 per cent of that coming from mobile apps.
The results could force Yahoo! to sell its 15 per cent stake in the business for much less than it had hoped. Yesterday's fall in Alibaba's share price - to about US$89 - means the US group's stake is worth US$4 billion less than it was on Tuesday, when Yahoo! announced that it would create a new company to hold the stock.
