Covid lockdowns in China’s biggest cities have sparked a hike in business for Alibaba and Baidu, thanks to surging demand for their cloud services as millions of citizens work from home, and in Alibaba’s case, shop for goods online.
Alibaba’s revenue beat market expectations for the fourth quarter, and its strong results come at a time when Beijing has vowed to boost support for tech companies, after a regulatory crackdown that has lasted about 18 months.
Demand for online services ranging from shopping to cloud-based products has skyrocketed in China as strict lockdowns prompt people to work, shop and keep themselves entertained from homes.
Revenue in Alibaba’s cloud computing division rose 12% to 18.97 billion yuan in the reported quarter. At the core commerce unit, its largest, revenue rose 8% to 140.33 billion yuan.
Overall, revenue rose 9% to 204.05 billion yuan ($30.35 billion) in the quarter. Analysts on average had expected revenue of 199.25 billion yuan, according to Refinitiv data.
US-listed Alibaba shares, which have lost roughly a third of their value so far this year, were up about 2% in premarket trading.
Baidu Boosted by Push into Robotaxis
Meanwhile, Baidu also topped quarterly revenue estimates on Thursday, thanks to its strong push into cloud services, robotaxis and autonomous driving in recent years.
Total revenue came in at 28.4 billion yuan ($4.22 billion) in the first quarter, compared with analysts’ average estimate of 27.82 billion yuan, according to IBES data from Refinitiv.
Net loss attributable to Baidu fell to 885 million yuan, or 2.87 yuan per American Depository Share (ADS), in the quarter ended March 31, compared with a profit of 25.65 billion yuan, or 73.76 yuan per ADS, a year earlier.
• Reuters with additional editing by Jim Pollard
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