Alibaba Cloud Looks To Tap New Customers In "Sunrise" Industries As Big Internet Companies Reach Market Saturation

·1 min read
  • Alibaba Group Holding Limited's (NYSE: BABA) cloud operation thinks it's reached market saturation among China's big internet companies, the Register reports.

  • However, Alibaba Cloud saw a new wave of demand from industrial outfits and looked to chase new customers in "sunrise" industries.

  • Alibaba Cloud also aims to build proprietary technology capabilities "in key areas such as computing, big data and artificial intelligence" to create a unique selling proposition and found it crucial to improve its security.

  • Alibaba Cloud's custom SmartNIC will likely become the core of its next generation of cloud computing infrastructure.

  • Alibaba's Q1 saw Alibaba Cloud win $3.57 billion in revenue, of which customers spent $2.64 million other than Alibaba's various business units.

  • Alibaba's Q1 revenue grew 10% year-over-year as Alibaba's business growth was flat to $30.7 billion, primarily due to China's COVID resurgence.

  • Alibaba highlighted that "non-internet industries contributed 53% of Cloud revenue, up more than five percentage points compared to the same quarter last year."

  • Alibaba also disclosed an "internet industry deceleration" that restricted the growth of the Alibaba cloud.

  • Earlier this year, Alibaba's cloud unit disclosed intense organizational restructuring involving key heads.

  • Mizuho recently recommended investors rotate from the U.S. to China Internet names like Alibaba, citing stimulus policies.

  • Price Action: BABA shares traded lower by 1.54% at $91.13 on the last check Monday.

  • Photo by Fooksou Lamimo via Wikimedia

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