Information gathered by Chinese internet major a plus for product makers and marketers alike. EPA
Information gathered by Chinese internet major a plus for product makers and marketers alike. EPA
Information gathered by Chinese internet major a plus for product makers and marketers alike. EPA
Information gathered by Chinese internet major a plus for product makers and marketers alike. EPA

Technology

Alibaba beats profit estimates as tech earnings season enters full swing

Apple expected to hit record profits despite questions about iPhone X demand

John Everington

February 01, 2018

  • English
  • Arabic

Alibaba's revenues beat analysts' expectations for  its financial third quarter, the company announced yesterday, as analysts awaited earnings announcements from Amazon, Apple and Google's parent Alphabet.

Revenues of China's largest e-commerce firm  rose 56 per cent year-on-year in the three months ending December to 83 billion yuan (Dh48.4bn), coming in ahead of the 79.8bn average estimate of analysts polled by Thomson Reuters.

Alibaba, whose 2014 IPO in New York set a record for the world’s largest sharelisting, said on Thursday that it would acquire a 33 per cent stake in its payment affiliate Ant Financial, the world’s most valuable FinTech firm.

“This acquisition of Ant Financial’s stake could be a preparation for its potential IPO,” Steven Zhu, a Shanghai-based analyst with Pacific Epoch, told Bloomberg.

“Alibaba was able to improve revenue growth because performance-based ads were able to generate better revenue on mobile apps and its catered user pages drove more sales.”

Alibaba's earnings came ahead of results from its US counterpart Amazon, which was due to release its fourth quarter results as The National went to press.

Amazon shares rose strongly in pre-trade before Thursday’s open, on the expectation that the retailer’s results will be lifted by strong sales from the holiday season.

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Apple is expected to report record profits early Friday morning UAE time. But analysts are increasingly concerned that the company's flagship iPhone X, launched in November, is experiencing slower-than-forecast sales.

Amazon, Apple and Google’s parent Alphabet are all due to release their quarterly results after the close of trading in New York on Thursday.

The world’s largest tech firms have so far reported mixed fortunes for the three months to the end of December.

Facebook’s shares dropped after the social networking company said that time spent on its site fell by 5 per cent during the quarter, even before making sweeping changes to its newsfeed. The stock has subsequently rebounded following the company’s earnings call disclosed that the average price per Facebook ad rose by 43 per cent during the quarter.

E-commerce platform eBay’s shares surged 11 per cent on Thursday after reporting a 10 per cent rise in gross merchandise volume to $24.4bn for the quarter.

Things were not so rosy for the platform’s payments partner PayPal, after eBay announced it had signed up a Dutch payments firm, Adyen, as a new primary payment processor.

Sheikh Zayed's poem

When it is unveiled at Abu Dhabi Art, the Standing Tall exhibition will appear as an interplay of poetry and art. The 100 scarves are 100 fragments surrounding five, figurative, female sculptures, and both sculptures and scarves are hand-embroidered by a group of refugee women artisans, who used the Palestinian cross-stitch embroidery art of tatreez. Fragments of Sheikh Zayed’s poem Your Love is Ruling My Heart, written in Arabic as a love poem to his nation, are embroidered onto both the sculptures and the scarves. Here is the English translation.

Your love is ruling over my heart

Your love is ruling over my heart, even a mountain can’t bear all of it

Woe for my heart of such a love, if it befell it and made it its home

You came on me like a gleaming sun, you are the cure for my soul of its sickness

Be lenient on me, oh tender one, and have mercy on who because of you is in ruins

You are like the Ajeed Al-reem [leader of the gazelle herd] for my country, the source of all of its knowledge

You waddle even when you stand still, with feet white like the blooming of the dates of the palm

Oh, who wishes to deprive me of sleep, the night has ended and I still have not seen you

You are the cure for my sickness and my support, you dried my throat up let me go and damp it

Help me, oh children of mine, for in his love my life will pass me by. 

French Touch

Carla Bruni

(Verve)

First Person
Richard Flanagan
Chatto & Windus 

UAE currency: the story behind the money in your pockets

Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.

Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.

“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.

Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.

“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.

Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.

From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.

Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.

BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.

Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.

Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.

“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.

Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.

“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.

“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”

The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”

Tips to avoid getting scammed

1) Beware of cheques presented late on Thursday

2) Visit an RTA centre to change registration only after receiving payment

3) Be aware of people asking to test drive the car alone

4) Try not to close the sale at night

5) Don't be rushed into a sale 

6) Call 901 if you see any suspicious behaviour

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