Alibaba Revenue Rose to $22.7bn in the Second Quarter 2020
While many Chinese companies have faced severe challenges and losses caused by the coronavirus outbreak, Alibaba Group is emerging as one of the country’s biggest corporate winners of the COVID-19 crisis. The multinational tech giant gained the opportunity to expand its business during the first half of 2020, as demand for its services and online marketplace traffic surged amid the coronavirus lockdown.
According to data presented by StockApps.com, the Alibaba Group’s revenue jumped to $22.7bn in the second quarter of 2020, still four times less than its leading competitor Amazon.
Alibaba Quarterly Revenue Jumped 34% YoY, Amazon’s 40%
Alibaba Group emerged as China’s leading eCommerce company after the 2003 SARS outbreak. Since then, it has become a significant hirer and a lender, providing more than 100,000 jobs and offering billions of dollars in loans to SMEs.
One of the group’s most profitable marketplaces is Taobao, responsible for more than 80% of its sales. Unlike Amazon, Alibaba isn’t involved in direct sales and doesn’t own warehouses; it simply helps branded manufacturers and small businesses to reach consumers. Although both tech giants have established a strong presence in their domestic markets, there is intense competition between them in expanding to the new markets.
Alibaba’s revenue amounted to $11.9bn in the second quarter of 2018, while its US competitor reported $52.8bn, four times more than that. During the next twelve months, Alibaba`s revenues surged by 41% to almost $17bn in the second quarter of 2020. Amazon’s revenue rose by nearly 20% to $63.4bn in the same quarter. After a strong performance in the third and fourth quarter of 2019, the revenue of both companies slightly dropped in the first quarter of 2020. However, the second quarter of the year delivered the highest results, so far.
Alibaba Group’s revenue jumped to $22.7bn; an 34% increased year-over-year. The company’s Q2 Results also revealed the number of their annual active consumers on the China retail marketplaces surged by 16 million in three months, reaching a total of 742 million. Mobile MAUs on China retail marketplaces jumped to 874 million in June, an increase of 28 million compared to the first quarter. Adjusted EBITDA grew by 30% in a year to $7.2bn, while quarterly net income rose to more than $6.5bn.
In August, Amazon also announced its excellent second-quarter results, which revealed double-digit revenue growth year-over-year driven by a surge in sales amid the COVID-19 pandemic. The US tech giant’s revenue spiked 40% year-over-year to $88.9bn, up from $81.5bn expected. Net income surged by 100% to $5.2 bn, while earnings per share hit $10.30, a significant increase compared to $5.22 in the second quarter of 2019. The company reported its North American sales rose by 43% to $55.4bn, while international sales grew 38% to $22.7bn.
Combined Market Cap of Two Tech Giants Soared by 81% YoY
Besides their revenues and profits booming amid the coronavirus outbreak, both Alibaba Group and Amazon witnessed significant growth in their market capitalization since the beginning of the year.
In December 2019, the market cap of the Chinese tech giant amounted to $570.9bn, revealed the Yahoo Finance data. After a 10% drop in March, this figure rose to $581.2bn in June. Statistics show the Alibaba Group’s market cap continued growing in the third quarter, rising by $181.2bn after fantastic Q2 2020 results. In September, it surged to $762.4bn, a 75% jump year-over-year.
In 2020, Amazon officially became the fourth tech company to join the $1 trillion club, besides Apple, Microsoft, and Alphabet. Statistics show the company’s market cap amounted to $920.2bn in December last year. By the end of the first half of 2020, it rose to $1.38trn and continued growing ever since. Statistics show the combined value of Amazon’s stocks surged by $210bn after the US tech giant announced its last quarterly results and hit $1.59trn in September, an 80% increase year-over-year.
The combined market capitalization of the two competitors hit $2.35trn this month, almost 58% jump since the beginning of the year.
Vietnamese Prime Minister Moves on CBDC Amid Questions on Regional Nature of e-Yuan
This month, it was reported that Vietnamese Prime Minister Pham Minh Chinh asked, in Prime Minister’s Decision No 942/QD-TTg, the State Bank of Vietnam to study and execute a pilot implementation of a central bank digital currency before the end of 2023. Currently, cryptocurrencies are not legally recognized as an asset in the country, nor do any crypto exchanges hold licenses from the central bank. Last year, the country set up a group to study digital assets, with a purview that extended to potentially proposing regulatory mechanisms.
“Vietnam is a country that has had its eye on blockchain, even though they haven’t made many steps towards mainstreaming cryptocurrencies. It is a country that is interested in technology and riding a potential economic wave brought upon by new innovation, from blockchain to AI and VR. But, what’s notable here is that this decision was pushed forward very near the time that many pundits began to ask whether the Chinese e-Yuan would become a digital currency which transcended China and became something of a regional powerhouse as an asset,” said Richard Gardner, CEO of Modulus, a US-based developer of ultra-high-performance trading and surveillance technology that powers global equities, derivatives, and digital asset exchanges.
“I think that’s important. Many countries are looking at what’s happening in China, then taking a look at their own place in the CBDC rat race, and they’re making decisions, I think, which moves up their timetable. This isn’t an innovation where you want to be last to the party. Doing so, in fact, could have ripple effects across a country’s monetary policy,” noted Gardner.
“Digital money is an inevitable trend,” said Huynh Phuoc Nghia, Deputy Director of the Institute of Innovation under the University of Economics Ho Chi Minh City. Some believe that moving quickly to develop a CBDC could give countries like Vietnam greater influence in the global financial system.
“I think it’s too soon to say what kind of ripple effects this development will have. It’s worth noting that Vietnam is in the very early stages. This isn’t a case where they’re ready to begin a pilot test in the short-term. Vietnam isn’t Ghana. But, forging ahead now can only be a positive. It’s better to move forward than continue to wait. Those countries that continue to take a wait-and-see approach are going to find themselves in last place. This is a race you don’t want to finish last. It very well could be the 21st century equivalent to the Race to Space,” opined Gardner.
Modulus is known throughout the financial technology segment as a leader in the development of ultra-high frequency trading systems and blockchain technologies. Over the past twenty years, the company has built technology for the world’s most notable exchanges, with a client list which includes NASA, NASDAQ, Goldman Sachs, Merrill Lynch, JP Morgan Chase, Bank of America, Barclays, Siemens, Shell, Yahoo!, Microsoft, Cornell University, and the University of Chicago.
“Vietnam is so close in proximity to China, and China is so far ahead in the development of their own CBDC, it was likely the push that they needed to move on this. Earlier this year, some pundits wondered if the e-Yuan would replace the dollar. That’s a premature discussion to have. But, if successfully rolled out, could it have a real regional impact? Absolutely,” Gardner offered.
Fidelity Bank Promotes 745 Staff Members
Seeking to increase staff morale while empowering them to work more efficiently, Fidelity Bank has announced the promotion of 745 employees following the performance review of two financial years – 2019 and 2020.
A total of 461 staff members benefited from the FY 2019 promotion exercise, while 284 staff members benefited from the FY 2020 exercise. The beneficiaries cut across the senior, middle, and junior management cadre of the bank, and the promotion was based on merit, using a transparent and robust performance management system in line with global best practices.
Speaking about this, Nneka Onyeali-Ikpe, MD/CEO, Fidelity Bank Plc said “I am very delighted to announce the promotions for 2019 and 2020 financial years. Releasing the list for 2 financial years’ promotion at the same time is something we are very proud of. We strongly believe that the continuous growth of our bank over the years has been largely attributed to the commendable efforts and unrelenting sacrifices of our employees. Promotion is one of the many ways we express our gratitude. We are thankful to be home to many amazing talents that continue to drive our value and most importantly, serve our stakeholders to the highest standards.”
Speaking further, she said. “Since I was appointed the MD/CEO of our great bank in January 2021, I have been committed to a 7-point agenda to move our bank further, out of which workforce transformation is a key category. Staff performance and reward are critical to us, and as an organisation, we will continue to make available adequate resources to deepen the skills and entrench a culture of high performance amongst employees. I wish to appreciate all members of the Fidelity Bank family for their commitment and drive and unrelenting sacrifices towards delivering our objectives. As we move forward in our quest to becoming a leading tier-one bank, I encourage all elevated staff to see their promotion as a call to rededicate themselves to excellence.”
Fidelity Bank has continued to empower its employees with invaluable resources capable of putting them at the forefront of innovative transformation. In March 2021, the bank announced two capacity-building projects – One Culture Project and Project Alpha – that were targeted at transforming the workplace for its staff. In particular, Project Alpha was created to help Fidelity Bank develop a robust and holistic learning and development framework for all staff while One Culture Project was formed to reinforce the behaviour and value systems that will help the bank, as well as staff, achieve set goals.
Nigeria’s Central Bank To Launch Digital Currency On Oct 1
The Central Bank of Nigeria (CBN) has said that it will launch its much-awaited digital currency on October 1, to mark Nigeria’s independent anniversary.
CBN Director of IT Department, Rakiya Mohammed, revealed this at a private webinar, explaining that the banking sector regulator had been conducting research towards the launch of digital currencies since 2017.
She added that the central bank may conduct a proof of concept before the end of the year. The move to adopt the digital currency was first mulled by the CBN Governor, Godwin Emefiele, during the Monetary Policy Committee (MPC) in May.
He had said a digital currency will soon become a reality in the country, adding that the central bank had already set up its committee which was working on the concept.
The CBN governor had further restated the determination of the apex bank to drive the e-Naira project during the recent 306th Banker’s Committee meeting, pointing out that the process was ongoing.
Mohammed was quoted by Nairametrics to have highlighted the benefits of the digital currency, saying it would enhance macroeconomic management, boost economic growth, facilitate cross-border trade, boost financial inclusion and monetary policy effectiveness.
Mohammed said the digital payment instrument would further improve payment efficiency, revenue tax collection, remittance improvement, and targeted social intervention.
She added that the innovation would also benefit the fintech ecosystem by enhancing operational efficiency, opportunities for fintech start-ups in building services and products as well as financial inclusion that will contribute to economic growth, and the creation of a new system complimenting the traditional payment system.
Mohammed had last month said the proposed digital would be launched before December. According to her, every Nigerian would have access to digital currency.
She had while briefing journalists at the end of a Bankers’ Committee meeting said: “Let me state categorically that cryptocurrency such as Bitcoin and the rest of them are not under the control of the central bank; they are purely private decisions that individuals make and are not part of this arrangement.
“We have spent over two years studying this concept of central bank’s digital currency and we have identified the risks. And it is one of the reasons why I said we are setting up a central governance structure that would involve all industry stakeholders to access all the risks as we continue on this journey.
“Very soon we would make an announcement on the date for the launch and by the end of the year, we should have the digital currency.”
According to her, about 80 percent of central banks across the world are presently exploring the possibility of issuing the central bank’s digital currency, saying that Nigeria cannot be left behind.
Mohammed had added: “You are aware that we have two forms of fiat money: The notes and the coins. So, the central bank’s digital currency is the third form of fiat money. So, this digital money is going to complement the cash and note that we have.
“The central bank digital currency will just be as good as you having cash in your pocket. So, if you are having the currency in your pocket, you are as good as having cash on your phone.
“Now, why did we need to go into this? There are different cases that the central bank is looking at.
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