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This statistic highlights Alibaba’s Revenue Breakdown by Segment, split between Cloud Computing, Commerce, Digital Media, Entertainment and Innovation Initiatives, reported on a quarterly basis from 2017 onwards.
Alibaba is one of the largest retailers and e-commerce companies all over the world. It has several subsidiaries including Alibaba Investment, Trendyol, Jade E, Cain iao, etc. Alibaba earned revenue of $22.83 billion in Q2 2021, which, further increased to $31.14 billion in Q2 2022, with quarter-on-quarter growth of 36.39%. In Q1 2022, it made total revenue of $31.86 billion.
Alibaba generates earnings through the following segments:
|Revenue by Segment||Q2 2021||Q1 2022||Q2 2022||Contribution in Q2 2022|
|Digital media and entertainment||$1.18||$1.25||$1.25||4.01%|
|Innovation initiatives and others||$0.17||$0.21||$0.22||0.70%|
(All figures in billions, except percentages)
Commerce Segment consistently proves to be the highest revenue earner among the rest of the segments. It is comprised of various digital retail and wholesale marketplaces, logistics, and local consumer services. The company makes revenue from the sale of a variety of marketing services, customer services, product sales, membership fees, software service fees, and commissions on transactions. It contributes around 87% to the total revenue of the company every quarter.
In Q2 2021, Commerce Segment reported revenue of $19.28 billion, which increased in Q2 2022, with Quarter-on-Quarter growth of 37.75%. In Q1 2022, it made a revenue of $27.91 billion, which slightly decreased to $26.56 billion and contributed 85.29% to the total revenue of Alibaba.
Cloud Computing is the second highest-earning source for the company. Alibaba Cloud provides customers with a suite of cloud services, which includes storage, databases, network virtualization, management, and application services, machine learning platforms, and other services.
The cloud computing segment provides enhanced work capabilities and easy access to the company’s cloud, big data analytics, and AI capabilities. Segment earns revenue from enterprise customers, based on the duration and usage of the services. The segment contributes nearly 10% to the total revenue of the company, every quarter.
In Q2 2021, Cloud Computing earned revenue of $2.19 billion, which further increased to $3.10 billion in Q2 2022, with Quarter-on-Quarter growth of 41.55%. In Q1 2022, it reported revenue of $2.48 billion, which showed growth of 25% in the next quarter, cloud computing contributing 9.95% to the total revenue of the company.
Digital Media and Entertainment
Digital media and entertainment is the natural extension of the company’s strategy to capture consumption. It generates revenue primarily through customer management services, online games, subscriptions & membership fees. It is the third-largest earning source for the company.
In Q2 2021, the digital media and entertainment segment earned revenue of $1.18 billion, which increased to $1.25 billion in Q2 2022, with QoQ growth of 5.98%. In Q1 2022 and Q2 2022, earnings of the segment were the same and contributed 4.10% to the total revenue of the company.
Innovation initiatives and other
Innovation initiatives and other segments are the least contributors to the total earnings of the company. It earns primarily through product sales and services fees to customers. This segment aims to innovate and develop new services and products that can meet the needs of customers, including digital-navigation apps and network-communication apps.
In Q2 2021, Innovation initiatives and other segments reported revenue of $170.1 million, which increased to $220 million in Q2 2022 by 294.1%. In Q1 2022, the segment reported revenue of $210 million, which further increased in Q2 2022 and contributed 0.70% to the total revenue of the company.
About the Company
Alibaba Group Holding Limited, also known as Alibaba, was founded on 28 June 1999. Alibaba is a China-based public company. It is headquartered in Hangzhou, China. It is a multinational based on technologies; the company runs an online platform, specializing in retail, e-commerce, technology, and the internet. Alibaba is a C2C (consumer-to-consumer), and B2B (business-to-business) company.
Alibaba provides sales through web portals. It runs shopping search engines, electronic payment services, etc. In 2020, it was rated as the fifth-largest artificial intelligence company. The company provides real-time insights for merchants for better management of inventory and warehousing. It also allows the consumers to track their orders and provides super fast delivery.
The company’s mission is to make business easy anywhere and aims to build the infrastructure of commerce. The company uses mobile and online technology to enhance the overall efficiency and convenience not only for the customers but, also for providers. Alibaba Group Holding Limited faces stiff competition with Amazon, Walmart, eBay, Rakuten, Microsoft Azure, Shopify, Amazon Web Service, and JD (Jingdong) Ad.
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