Alibaba Group 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, which owns about 24% of the Chinese company and is highly sensitive to Alibaba's growth prospects and valuation.
The US company's stock was up 8% at $36.90 after hours despite reporting anaemic quarterly revenue and display advertising growth in its own business.
China's largest Internet company, which is racing to prepare for the largest US IPO since Facebook's 2012 coming-out party, recorded 66% 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 US tech debuts, spurred on by Twitter'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 US company told analysts during a conference call they would not comment further on Alibaba's numbers, given that the Chinese company has entered a pre-IPO quiet period.
Rags to riches
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 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.
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