Shares of Alibaba Group Holding Ltd. (BABA, Financial) tumbled over 4% in morning trading on Thursday on the heels of reporting its first quarter of operating losses in company history.
For the quarter ending March 31, the Hangzhou, Zhejiang-based e-commerce giant reported an operating loss of 7.663 billion yuan ($1.170 billion), reflecting an 18.228 billion yuan antitrust charge from the China State Administration for Market Regulation. CEO Daniel Zhang said that the operating loss was the company's first quarter of operating loss in Alibaba's history. Excluding the one-time charge, operating income would have been 10.565 billion yuan, up 48% from the prior-year quarter.
Company achieves historic milestone of 1 billion active users for the year
Alibaba reported revenue of 717.289 billion yuan, up 41% year over year, driven on active users for the Alibaba Ecosystem surpassing 1 billion during the 12 months ending March 31. China retail marketplace customers increased to 811 million, up 85 million from the fiscal 2020 total.
GuruFocus ranks Alibaba's profitability 8 out of 10 on the back of profit margins and returns outperforming over 85% of global competitors.
Stock falls on revenue and earnings miss
Shares of Alibaba traded at an intraday low of $208.13, down approximately 5.35% from Wednesday's close of $219.90. The stock is significantly undervalued based on Thursday's price-to-GF Value ratio of 0.59.
Gurus with holdings in Alibaba include Baillie Gifford (Trades, Portfolio), Ken Fisher (Trades, Portfolio) and PRIMECAP Management (Trades, Portfolio).
Disclosure: Long Alibaba.
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