Financial Perspective and Guidance - Alibaba...
Transcript of Financial Perspective and Guidance - Alibaba...
Financial Perspective and GuidanceMaggie Wu, CFO
1. Report Card Since IPO
4. Financial Guidance
2. Evolving Value Proposition to Customers 3. Metrics
5. Valuation Framework
Key Topics
1. Report Card Since IPO
?How Sustainable is China Retail Marketplace’s GMV Growth
?How Sustainable is China Retail Marketplace’s GMV Growth
0
800
1,600
2,400
3,200
4,000
FY13 FY14 FY15 FY16 FY17
RMBbn
37% CAGR FY13-17
US$547
BILLION
GOAL REMAINS UNCHANGED
US$1 TRILLION GMVGOAL FOR FY2020
ALIBABA MARKET LEADERSHIP
11%CHINA RETAIL
SALES
SOURCE NBSMARKETSHARE IN FY17
Source: National Bureau of Statistics (NBS), Alibaba. Estimated market share as of March 31, 2017
?What’s Alibaba’s strategy to transition from PC to Mobile?
Will mobile monetization ever be higher than that of PC?
?What’s Alibaba’s strategy to transition from PC to Mobile?
Will mobile monetization ever be higher than that of PC?
GROWING MOBILE MAU
0
200
400
600
MAR 14 MAR 15 MAR 16 MAR 17
163
289
410
507
M
MOBILE GMV %
0%
25%
50%
75%
100%
FY14 FY15 FY16 FY17
19%
41%
65%
79%
Mobile GMV %
GMV
0%
1%
2%
3%
4%
5%
FY14 FY15 FY16 FY17
2.55% 2.44% 2.59%3.03%
Blended Monetization Rate
MONETIZATION RATE
0%
1%
2%
3%
4%
5%
FY14 FY15 FY16 FY17
2.94% 2.89% 2.73% 2.97%
0.91%
1.79%
2.51%3.04%
Mobile Monetization RatePC Monetization Rate
PC
Mobile
MOBILE REVENUE %
0%
25%
50%
75%
100%
FY14 FY15 FY16 FY17
7%
30%
63%
80%
Mobile Revenue %
Revenue
MOBILE GMV & REVENUE %
0%
25%
50%
75%
100%
FY14 FY15 FY16 FY177%
30%
63%
80%
19%
41%
65%
79%
Mobile GMV % Mobile Revenue %
Revenue
GMV
?What is Alibaba Cloud’s growth potential and when will it be profitable
0
440
880
1,320
1,760
2,200
Jun 30, 2015
Sep 30,2015
Dec 30, 2015
Mar 31, 2016
Jun 30, 2016
Sep 30, 2016
Dec 31, 2016
Mar 31, 2017
ALIBABA CLOUD REVENUE
RMBmn
?What is Alibaba Cloud’s growth potential and when will it be profitable
YoY 106% 128% 126% 175% 156% 130% 115% 103%
FY15 FY16 FY17
ALIBABA CLOUD ADJ. EBITA MARGIN
Adj. EBITA Margin
-41% -7%
?Why is SBC as % of revenue so high?
What’s the dilution impact from SBC?
FY16 FY17
SBC Dilution (0.9%) (0.7%)
SHARE DILUTION % OF TOTAL*
*Accretion / (dilution) effect calculated relative to fully diluted shares outstanding as of April 1, 2015 and April 1, 2016 for FY16 and FY17, respectively#Repurchase of shares represents shares repurchased pursuant to the Share Repurchase Program in FY2016 and shares repurchased from SoftBank in FY2017
SBC AS % OF REVENUE HAS BEEN TRENDING DOWN
0%
5%
10%
15%
20%
25%
30%
Sep 30, 2014
Dec 31, 2014
Mar 31, 2015
Jun 30, 2015
Sep 30, 2015
Dec 31, 2015
Mar 31,2016
Jun 30,2016
Sep 30,2016
Dec 31,2016
Mar 31,2017
18% 16%
27%
20%
14%13%
19%
11% 12%
7%
11%
Overall SBC
0%
5%
10%
15%
20%
25%
30%
Sep 30, 2014
Dec 31, 2014
Mar 31, 2015
Jun 30, 2015
Sep 30, 2015
Dec 31, 2015
Mar 31,2016
Jun 30,2016
Sep 30,2016
Dec 31,2016
Mar 31,2017
16%
12% 13%10% 9% 10%
13%
8%10%
6%
10%
18% 16%
27%
20%
14%13%
19%
11% 12%
7%
11%
Overall SBC SBC Related to Alibaba Shares
SBC AS % OF REVENUE IS EVEN LOWER EXCLUDING GRANTS TO ALIBABA EMPLOYEES FROM ANT
?Why is SBC as % of revenue so high?
What’s the dilution impact from SBC?
Accretive Share Repurchase 1.8% 1.0%
Accretion / (Dilution) 0.8% 0.3%
?How would Alibaba strategic investments impact the core
commerce margin
?How would Alibaba strategic investments impact the core commerce margin
50%
56%
62%
68%
74%
80%
Jun 30,2015
Sep 30,2015
Dec 31,2015
Mar 31,2016
Jun 30,2016
Sep 30,2016
Dec 31,2016
Mar 31,2017
65%62%
65%
59%61% 62%
64%
59%
CORE COMMERCE ADJ. EBITA MARGIN
62%FY17
63%FY16
2. Evolving Value Proposition to Customers
?Would Alibaba’s Higher Monetization Rate Hurt
Merchants’ ROI ?Will China Retail revenue
growth continue to outpace GMV growth
Alibaba Economy's Broader Value Proposition vs GMV
TAKE RATE =CHINA RETAIL
REVENUE
CHINA RETAIL GMV
OLD & NARROW
OFFLINE SALES
ONLINE SALES
BRAND VALUE
CUSTOMER ACQUISITION
+ ENGAGEMENT
PRODUCTIVITY GAINS
++=OUR TAKE
VALUE PROPOSITION TO BRANDS AND MERCHANTS
MARKETING REVENUE
CUSTOMER SERVICE
DISTRIBUTION REVENUE
High Growth In User & User Engagement
VALUE PROPOSITION
KEEPS EVOLVING: Enable Merchants to Manage Customer
Life Cycle
80%+ YoY# of Users and # of Times
Sharing the Product
60%+ YoYDaily Avg. Unique
Product PV
140+% YoYContent Driven Product PV
45%+ YoYDaily Avg. Buyers Adding
to Shopping Cart
For the month ended Apr 30, 2017 For the month ended Apr 30, 2017 For the month ended Apr 30, 2017For the month ended Mar 31, 2017
Increase User Engagement From Robust Growth of Daily Content PVCrazy about ShoppingGood Find Taobao HeadlinesWeitao
Taobao Live SteamingYour Advice Please
120%+ YoY
Daily Content PV
For the month ended Apr 30, 2017
Increase User Engagement From Robust Growth of Daily Content PVCrazy about ShoppingGood Find Taobao HeadlinesWeitao Taobao Live SteamingYour Advice Please
120%+ YoY
Daily Content PV
For the month ended Apr 30, 2017
The Longer the Consumer Is on the Platform… The More Orders They Place
Consumer Registered Year 2016 (Year 1) 2015 (Year 2) 2014 (Year 3) 2013 (Year 4) 2012 (Year 5)
230
184
138
92
46
0
Avg. Annual No. of Orders
123
38
Consumer Registered Year 2016 (Year 1) 2015 (Year 2) 2014 (Year 3) 2013 (Year 4) 2012 (Year 5)
230
184
138
92
46
0
Avg. Annual No. of Orders
123
38
40
32
24
16
8
0
Avg. Annual No. of Orders
Avg. Annual No. of Categories Purchased
24
9
The Longer the Consumer Is on the Platform… The More Categories They Purchased
Consumer Registered Year 2016 (Year 1) 2015 (Year 2) 2014 (Year 3) 2013 (Year 4) 2012 (Year 5)
230
184
138
92
46
0
Avg. Annual No. of Orders
123
38
40
32
24
16
8
0
Avg. Annual No. of Orders
Avg. Annual No. of Categories Purchased
24
9
RMB12,000
9,600
7,200
4,800
2,400
0
Avg. Annual No. of Orders
Avg. Annual No. of Categories Purchased
Avg. Annual Spend Per Consumer
~12K RMB
~3K RMB
The Longer the Consumer Is on the Platform… The Higher the Spend
3. Metrics
Annual Active
Buyer Annual Active
Consumer
Online Marketing Revenue
Help Merchants & Brands toAcquire, Engage & Retain Their Customers
MARKETING
CUSTOMER SERVICE
DISTRIBUTION
Customer Management
Revenue
4. Financial Guidance
FY 2018 Annual Revenue Guidance
TOTAL REVENUE GROWTH
RANGE:45% – 49%
FY16
FY17FY18
45% – 49%
56%*
33%
*Excluding the impact from Youku and Lazada consolidation beginning April 2016, the growth rate would have been 45%.
Continuous Investments for
Future Growth
< 3 Years 3 ~ 7 Years > 7 Years
Core Commerce
Cloud Computing
Digital Media & Entertainment
Innovation Initiatives
®
INCUBATION TRACTION CASH FLOW
Supermarket
Cross Platform Uni-Marketing New Retail
International Rural
Subscription InternationalContent
Mapping IOTEnterprise Communication AI
#1 ChinaeCommerce
Platform3,767 RMBbn
GMV
454mnANNUAL ACTIVE BUYERS (FY17)
Successful Track Record from Multi-Year Investments#1 ChinaCloud Platform
US $968mnREVENUE IN FY17
874,000# OF PAYING CUSTOMERS
As of Mar 31, 2017 0
3,500
7,000
10,500
14,000 Alibaba Cloud
RMBbn
0
30,000
60,000
90,000
120,000
1 2 3 4 5 6 7 8 9 10 11 12 13 14
China Commerce RetailRMBbnChina Commerce Retail Revenue
114,109 RMBmnUS $16,578mn
Year
Alibaba Cloud Revenue6,663 RMBmn
US $968mn
5. Valuation Framework
Alibaba is the Market Leader in Multiple Businesses
#1 Market Share in B2C in China(iResearch)
#1 eCommerce APP Measured by Mobile MAU in China(QuestMobile 201704)
®
#1 eCommerce Site Measured by GMV in 5 SEA Countries (App Annie)
#1 2nd Hand eCommerce APP Measured by Mobile MAU in China (QuestMobile 201704)
#3 Online Video Platform in China(QuestMobile)
#1 Public Cloud Service Provider in China (IDC 2016)
… More
#1 Browser in India and Indonesia(Statcounter)
#2 Mobile Search Engine in China(iiMedia)
#2 Map APP Measured by Mobile MAU in China(QuestMobile)
#1 Office Communication APP Measured by Mobile MAU in China (QuestMobile 201704)
Globally Leading Techfin Company
#1 Online Payment(iResearch)
#1 Shopping APP in
Russia and #3 in Spain (App Annie)
#2 Movie Ticketing Service Measured by Mobile MAU in China(QuestMobile 201704)
(Ant Financial)
Notes:Tao Piao Piao, Ant Financial, and Alipay are affiliated businesses.
CORE COMMERCE CLOUD COMPUTING DIGITAL MEDIA & ENTERTAINMENT INNOVATION INITIATIVES & OTHERS STRATEGIC INVESTMENT
Notes:Financial data presented is for FY17.1.Estimate based on information as of Mar 31, 2017. Based on
valuation implied by recent equity financing (if applicable), or carrying value as of Mar 31, 2017. Translations of RMB into US$ were made at RMB6.8832 to US$1.00.
2.Mobile MAU for China retail marketplaces in the month ended Mar 31, 2017.
3.As of Mar 31, 2017.4.Global MAU in the month ended Mar 31, 2017.
VALUATION COMPARISON PEERS
RMBmn % YoY
Revenue 133,880 45%
Adj. EBITA Margin 62%
Mobile MAU(2) 507mn
> US$50bn(1)RMBmn % YoY
Revenue 6,663 121%
Adj. EBITA Margin (7%)
Paying Customers(3) 874,000
RMBmn % YoY
Revenue 2,997 65%
Adj. EBITA Margin (104%)
®
RMBmn % YoY
Revenue 14,733 271%
Adj. EBITA Margin (44%)
MAU(4) 500mn+
0
14,000
28,000
42,000
56,000
70,000
FY13 FY14 FY15 FY16 FY17
RMBmn
NON-GAAP NET INCOME CAGR OF 43%
US$8.4
BILLION
0
14,000
28,000
42,000
56,000
70,000
FY13 FY14 FY15 FY16 FY17
RMBmn
FCF CAGR OF 37%
US$10.0
BILLION
US $8.0BILLION
NET CASH
AS OF MARCH 2017
Robust Profitability and Cash Flow