Alibaba has faced growth challenges amid tightening regulation of China’s domestic tech sector and a slowdown in the world’s second-largest economy. But analysts say the e-commerce giant’s growth could accelerate through 2022.
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Alibaba said it will invest $1 billion over the next three fiscal years to help customers use cloud computing as the Chinese e-commerce giant looks to revive growth after a historic downturn. .
The investment includes “financial and non-financial incentives, such as sponsorships, discounts, and go-to-market initiatives,” Alibaba said in a press release on Thursday.
The company said it is also setting up a program to help customers localize their cloud business needs depending on the market.
Alibaba is the third largest cloud computing company in the world behind Microsoft and Amazon, according to Gartner. Although cloud computing is a small part of Alibaba’s overall business today, the company’s management sees it as a key ingredient to future growth and profitability.
However, Alibaba has seen an unprecedented slowdown in growth amid China’s economic difficulties caused by the resurgence of Covid in the world’s second-largest economy and the domestic regulatory environment. closer. During the 4th to 6th quarters, Alibaba reported first steady revenue growth on record.
Revenue growth in its cloud business also slowed from the previous quarter.
Alibaba’s investment announcement is also part of a broader effort by the Hangzhou-based company to expand its cloud computing business overseas.
Over the past few years, Alibaba has opening new data center outside of China to win customers in other markets like Singapore and Thailand.