Alibaba’s cloud computing year-to-year revenue skyrocketed by 76% to US$1.1 billion in the fourth quarter of 2019.
For the full fiscal year ending 31 March 2019, Alibaba Cloud’s revenue was US$3.68 billion, a rise of 84% from 2017, meaning the division now accounts for seven per cent of the company’s total revenue of US$56.15 billion.
However, the division’s operating costs outstripped its revenue, leaving Alibaba Cloud with a total ebitda loss of US$168 million, an annual increase of 44%.
Alibaba was nevertheless buoyed by its cloud results, claiming it is now the largest cloud computing service provider in Asia Pacific.
According to the company, the revenue growth stemmed largely from a spending increase by its customers, saying it was seeing significant traction and diversification of customers and revenue.
However, the company noted that it “continue[d] to use our scale to lower the pricing of products and services in the areas of content delivery network, security, database and network infrastructure” in order to remain cost-competitive for customers.
“In fiscal year 2019, Alibaba Cloud served more than half of the A-share listed companies in China,” the company added. “We will continue to invest to further expand our market share by developing value-added products and features.”
According to Gartner, Alibaba is set to become the fourth biggest public cloud provider globally, behind AWS, Azure and Google Cloud respectively.
“Alibaba still have an issue in terms of geography,” Gartner senior director Alan Waite told a recent conference in Sydney.“They’re still very much China-based and only just starting to get English-language documentation. But they’re offering attractive pricing and some good capabilities.”