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Investors anxiously awaiting the Alibaba IPO received an important update yesterday (Tuesday): The Chinese e-commerce firm more than doubled its profits in the fourth quarter of 2013.
The glimpse at Alibaba's financials came courtesy of Yahoo! Inc.'s (Nasdaq: YHOO) earnings report, because Yahoo owns a 24% stake in Alibaba. Yahoo reported earnings after the close yesterday.
According to Yahoo, Alibaba's revenue increased 66% in Q4 (the most recent quarter available) from the previous year. In Q3, Alibaba increased revenue by 51%.
For Alibaba, revenue reached $3.06 billion in Q4, while profits of $1.35 billion were more than double what the company had reported in Q4 of 2012.
YHOO stock jumped 9% in after-hours trading yesterday, despite the fact that its own earnings report was lackluster. YHOO beat earnings by a penny, but posted stagnant revenue. The Alibaba news, however, helped push YHOO stock higher.
The jump in revenue is partially attributed to Alibaba's massive "Singles' Day" sale, which took place on Nov. 11. According to the company, more than $5.7 billion exchanged hands over a 24-hour period that day, as single men and women showered themselves and each other with gifts on the holiday.
Yesterday's Yahoo report stoked the anticipation of investors, and the timing of the news couldn't be any better for Alibaba...
Alibaba's IPO Strategy Expands the Brand
According to a Reuters report, sources close to the company have stated that the e-commerce firm will be filing the prospectus for its highly anticipated U.S. IPO on Monday, April 21.
In February, analysts polled by Reutersestimated that the Alibaba IPO could raise up to $15 billion. But following a string of acquisitions and yesterday's strong financials, some think the deal could rival the Facebook Inc. (Nasdaq: FB) IPO of 2012, which raised $16 billion and was the largest Internet IPO in U.S. history.
The profits figure has certainly helped push that total higher, but it isn't the only factor behind Alibaba's IPO funding...