In case you missed it, Alibaba.com, one of the world’s largest B2B marketplaces, issued a profit warning last night despite 158% profit growth in the quarter. The reason?
Per the CEO,
1) "The economic winter is making it difficult for some of our customers to conduct business and, as a result, we have seen a slowdown in the addition of Gold Supplier members (61% of revs), which may continue until next year.
2) “We see difficulties in four out of the 40 sectors we have: textile, metal, garment and construction services," said Mr Wei.
3) "It will be even worse in the second half."
I couldn’t have said it better myself. Margin expectations in apparel remain too high for the next 12 months.
Per the CEO,
1) "The economic winter is making it difficult for some of our customers to conduct business and, as a result, we have seen a slowdown in the addition of Gold Supplier members (61% of revs), which may continue until next year.
2) “We see difficulties in four out of the 40 sectors we have: textile, metal, garment and construction services," said Mr Wei.
3) "It will be even worse in the second half."
I couldn’t have said it better myself. Margin expectations in apparel remain too high for the next 12 months.
