By (Reuters) -Alibaba Group Holding missed analysts’ estimates for quarterly sales on Friday, as lingering economic uncertainty sapped consumer spending in China and weighed on the e-commerce giant’s domestic business.
Chinese consumers have sharply cut back on spending, especially on discretionary items, as the world’s second largest economy struggles to pick up pace amid a property sector crisis and heightened youth job insecurity.
That has knocked retail sales, which remain pressured even as major vendors like Alibaba (NYSE:BABA) and JD (NASDAQ:JD).com dole out promotions and discounts. JD.com on Thursday also missed estimates for quarterly revenue.
Alibaba is also facing stiff competition from discount-based retailers such as PDD Holdings’ Pinduoduo (NASDAQ:PDD) and ByteDance-owned Douyin, which have wooed thrifty shoppers with rock-bottom prices on everything from headphones to sweaters.
Alibaba reported revenue of 236.50 billion yuan ($32.72 billion) for the second quarter ended Sept. 30, compared with analysts’ average estimate of 240.17 billion yuan, according to data compiled by LSEG.
($1 = 7.2275 Chinese yuan renminbi)