ANALYSIS: Pressure grows on China’s tech giants Tencent and Alibaba to keep up blistering pace
Alibaba is preparing for a future in which it handles a billion packages a day, writes Lulu Yilun Chen
Hong Kong — It is getting tougher for China’s technology giants to live up to expectations. After Alibaba and Tencent added more than $450bn of combined market value this year, investors are counting on the pair to at least match projections for quarterly revenue growth of more than 50%, and sustain a similarly blistering pace in 2018. The first test will come on Thursday with Alibaba’s results. The market has reason to believe expansion can continue. Heavy spending in the cloud, finance and artificial intelligence could pay off in coming years. Alibaba and Tencent — largely confined for now to an increasingly saturated home market — are already beginning to take steps toward a more global business. Their financial muscle also helps them withstand new competition from the likes of Toutiao and retain pole position in Chinese e-commerce, gaming and social media. All that props up a premium they enjoy over the so-called Fang quartet of Facebook, Amazon.com, Netflix and Alphabet’s Googl...
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