Alibaba - Munger's BIGGEST mistake! Is it yours as well?
It was also around that period when Charlie Munger expressed that Alibaba was his biggest mistake.
Was he right to admit so?
1. Topline 2% growth YoY
Topline for Baba was flattish YoY, both from Q3'22 vs Q3'21 and 9M‘22 vs 9M'21.
Some key findings that might make investors skeptical include shrinkage in China commerce, which is down by 1% YoY.
2. Good growth for international commerce, and narrowing losses
Under International Commerce, where Alibaba consolidates Lazada, AliExpress, Trendyol, Daraz, and Alibaba.com, Q3'22 revenue shows an impressive 26% growth. Total 9M'22 adjusted EBITA loss decreased from RMB 6.4 billion to RMB 3.3 billion.
3. Cainiao is successful
Cainiao, Alibaba's logistic arm, posted accelerated growth in topline for Q3'22 vs Q3'21. EBITA margin also slowly moves toward profitability
4. Cloud loses steam
Once seen as a great pivot, Alibaba's cloud's latest meager growth of just 3% is startling. While other cloud companies continue to grow at mid-20 % YoY, a 3% YoY growth is definitely underperforming.
I would say that these results are mixed, what do you think?
Is it time to invest in Alibaba or stay away?
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Macdonell J : Your headline is misleading or just meant for clickbait? Charlie Munger was saying his biggest mistake of recognising Alibaba as a technology company, but in actual fact it's an Internet platform where majority of its revenue comes from the retail business.