[drum]

The brewing trade war can't make running the company easy for Ma, considering Alibaba does more volume than eBay and Amazon combined as a portal to Chinese manufacturers. Taking into account that the company's listed on a US stock exchange yet still has to answer to government regulation back in China, I can't imagine he's having a good time being caught in the middle.

[rgbrenner]

They'll be ok, even with the trade war. The majority (about 90%) of Alibaba's sales are domestic (Chinese). The rest is exports (not just to the US though): https://www.statista.com/statistics/226793/e-commerce-revenu...

And read this if you want to get an idea of where their revenue comes from: https://www.nasdaq.com/article/alibaba-baba-misses-q1-earnin...

[crystalmeph]

>The majority (about 90%) of Alibaba's sales are domestic (Chinese)

But how many of those domestic customers get their own paycheck from exports? China is moving towards a more domestic-focused economy, but exports are still a big deal for them.

[roenxi]

I'm not current on the statistics but my understanding was that at the moment there is a flow of real goods (and services?) from China to America.

If that assumption is reasonable, it is difficult to describe a situation in China where the customers get worse off due to reduced exports without the leadership going crazy (like shutting down all their factories and everyone sitting at home sulking instead of selling their goods locally at a discount). If they pretend the American dollar is the be-all-and-end-all they will get into trouble, but it is hard to see why they would do that.

I'd speculate the situation would be OK for any shareholders in China, where any on-paper drops would be countered by improved real access to stuff, and probably bad for shareholders in America where on paper drops may as well be real. Of course, real life is so complicated it is who can even guess?

[PakG1]

Did you try reading the above linked NASDAQ link?

Total overall revenues:

Alibaba reported revenues of RMB80.9 billion (US$12.23 billion), up 61% from the prior-year quarter. Also, revenues came in slightly above the Zacks Consensus Estimate of US$12.25 billion.

Total revenues related to selling exports:

· International commerce retail business (6% of the total revenues) - Revenues in the quarter were RMB4.3 billion (US$652 million), increasing 64% year over year. The increase was driven by robust GMV growth in two marketplaces, namely Lazada and AliExpress.

· International commerce wholesale business (2% of the total revenues) - This business generated revenues of RMB1.8 billion (US$278 million), increasing 14% from the prior-year quarter. The growth was due to an increase in the number of paying members on alibaba.com platform.

So a total of 8% of total revenues were due to selling exports. Plus, it's not clear how much of that revenue is from Lazada, which is not subject to US tariffs because its target market is Southeast Asia. If anything, everyone is suffering from US tariffs, so Lazada can only grow because it's a trade relationship that doesn't depend on the US.

[jjeaff]

I think you misunderstood what they were saying... That it's possible the domestic customers that make up the majority of Alibaba revenue may decrease their spending on the platform if their own incomes rely on exports.

[PakG1]

Yup completely misread and misunderstood, my bad. :)

[364403453]

as a chinese, we barely rely on export as you may already aware of. domestic economy doesn't change even a bit during trade war. simply because we are LARGE in many perpective. the cost of renting the house or buy one are on a up-hill. you may felt we should be affected, but the fact is that we use your tech(computer engineering) and change our life without much expense of research and development.

[yawrite]

Everyone hurts from a trade war. As an American, you should know we have seen so much boasting lately that it sounds like the noise of young children.

[jonknee]

Well that and he hasn't been running the company for a while. He stepped down as CEO in 2013. This is very similar to Bill Gates leaving Microsoft (who Ma has actually mentioned as an influence).

[owens99]

I visited Alibaba in 2011 and at that time he had already handed the reigns over to David Wei.

[jayalpha]

Some words of caution.

https://brontecapital.blogspot.com/2015/10/alibaba-yeah-righ...

https://brontecapital.blogspot.com/2015/09/job-interview-que...

BTW, AFAIK Ma seperated Alipay from the Alibaba entity.

[makomk]

There's one key fact they seem to be either missing or intentionally ignoring: Alibaba's websites are marketplaces populated by third-party sellers. So they don't need to have enough staff to ship all those parcels because they're not the company shipping them, and it's perfectly normal that customers would be receiving multiple packages because every seller packs their goods seperately.

The reason I'm suggesting that they're intentionally ignoring this fact is that it's actually in the information presented in the article. For example, the video they link in their section about the logistics explains this in detail.

[zhte415]

Not an easy company by any stretch. British Virgin Islands registered and extremely hard to unwrap ultimate ownership even.

[seanmcdirmid]

Alibaba is much more transparent than say Huawei. Alibaba is even publicly traded on an American exchange, so its ownership is much more clear.

[aslkdjaslkdj1]

It's illegal for foreigners to own a Chinese company. A shell company based in the Caribbean is publicly traded. It owns no assets.

https://www.barrons.com/articles/beware-the-pitfalls-of-the-...

[adventured]

It is not illegal for foreigners to own part of Chinese companies. It's generally illegal for a single foreign entity to own a controlling interest. Softbank and Yahoo invested into Alibaba relatively early on. It was incorporated in China. Their positions represented the majority of shares in the business, just not individually.

[dnomad]

> It's generally illegal for a single foreign entity to own a controlling interest.

This is also not true. China, like all developing economies that have reached the global stage, allows WFOEs and FICEs [1]. There's significant taxes involved but these taxes are being decreased all the time .

(It's quite remarkable the stuff people believe about doing business in China. Really have to wonder where these ideas come from.)

[1] https://en.wikipedia.org/wiki/Wholly_Foreign-Owned_Enterpris...

[Catsing_Cats]

There are severe restrictions on WFOEs. For all practical purposes they're useless for running a domestic tech business.

Really recommend this write up on VIEs and Alibaba: https://www.hbs.edu/faculty/conferences/2017-imo/Documents/M...

[perseusprime11]

Good points but probably not the reason why he is really retiring. Jack Ma cannot be more famous than their President.