Alibaba’s AliCloud Reports 175 Percent Growth

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Aliyun cloud lands revenues of $165 million (£114m) on 500,000 paying customers

Alibaba’s Aliyun cloud computing division was a strong performer in the company’s fourth quarter financial results this week, posting a 175 percent year-on-year increase in revenue.

Aliyun, or AliCloud as it is also known, now boasts more than 500,000 paying users, and was the highest growth business for Alibaba over the past 12 months.

Amazon’s Chinese competitor’s commerce retail business grew 41 percent year-on-year.

2.3 million

AliCloud now has 2.3 million customers altogether, with revenue hitting $165 million (£114m). In the last quarter, the cloud division claims to have launched 612 new features and services bundled with 22 new products. AliCloud has worked to focus on Big Data this year, and new features from the cloud vendor include Big Data computing engines and data analysis tools.

alibabaMaggie Wu, Alibaba’s chief financial officer, said that the results showcase the “resiliency and growing clout” of Chinese consumers.

“Our excellent results this quarter reflect the unique strength of our core e-commerce business despite challenging economic conditions, as well as the emerging momentum of our balanced portfolio of businesses from mobile media to cloud computing. As a result, we achieved accelerating year-over-year revenue growth of 39%, which was the highest revenue growth rate for the past four quarters,” she said.

Alibaba’s business as a whole increased its revenue by 33 percent to $15.7 billion for the financial year 2016, with top line gross merchandise revenue at $485 billion (£335bn). These figures boost Alibaba ahead of US competitor Walmart, which posted revenues of $482 billion (£332bn) for its year ending January 31.

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AliCloud itself aims to take on Amazon Web Services (AWS) in the cloud computing space. With multiple investments over the past year, Alibaba is pushing AliCloud out of China into new markets such as the Middle East to occupy land where AWS has been slower to fill.

Last summer, president of AliCloud Simon Hu said: “Our goal is to overtake Amazon in four years, whether that’s in customers, technology, or worldwide scale.”

It’s clear AliCloud has big ambitions. Taking on a worldwide cloud market worth billions of pounds in revenues, AliCloud is entering a tough competitive bazaar with its SaaS and IaaS services, AWS hauled in revenues of around $6 billion last year, and dominates the public cloud space around the world with a potential run rate of $10 billion for 2016.

According to Gartner, the global public cloud services market will be worth $204 billion (£140bn) this year, up by more than 16 percent from 2015’s total of $175 billion (£123bn).

“We aim at building an ecosystem globally that leverages our cloud computing expertise to efficiently and securely serve the needs of our clients all over the world,” an AliCloud spokesperson told TechWeekEurope. “This is our ongoing commitment and we are confident to move it forward in international market.”

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