Alibaba CEO says cloud business “continues to defy gravity” as revenue increases 99% year on year

Alibaba Group has recorded cloud revenues of RMB 2,975 million ($342.1m) for its most recent quarter, up 99% year on year, with CEO Daniel Zhang telling analysts its cloud business “continues to defy gravity.”

The company said it was seeing ‘significant traction and diversification of customers and revenue’ in its cloud service, and will ‘continue to invest to further expand the market through valuable services for our cloud customers.’

Total revenues for the quarter hit RMB 55,122m (£6.bn), with the vast majority of that through its ‘core commerce’ business at RMB 46,462m (£5.3bn). Other buckets include digital media and entertainment (£551m) and the vaguely worded ‘innovation initiatives and others’ (£102.5m).

Among the quarter’s highlights for Alibaba were 245 new products and features, alongside a variety of initiatives and customers. The majority of these were revealed at the company’s Computing Conference in Hangzhou. Customers include the Bank of Nanjing, Air Asia, State Administration Taxation and the IOC (International Olympic Committee), while products include the X-Dragon Cloud server, combining bare metal servers with VMs, and newly released relational database POLARDB.

The previous quarter saw revenues from cloud computing total RMB 2,431 million (£287m), and Zhang was in bullish mood in the earnings call. “Our cloud computing business continues to defy gravity,” said Zhang, as transcribed by Seeking Alpha. “Revenue increased by 99% year over year. We continue to multiply our product portfolio, including the introduction of a new relational database and a state of the art server developed in-house that serve the needs of large enterprise customers.”

Alibaba’s cloud push appears to be paying off with the analysts. According to Gartner back in September, Alibaba has moved ahead of Google to take third place in the public cloud infrastructure as a service (IaaS) market.

“Once again, we have delivered an outstanding quarter,” added Zhang. “The robust growth of our business speaks to the unique value proposition that we offer to customers through our strong execution and commitment to innovation.”

You can view the full financial statement here.

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