NEW YORK -- Chinese e-commerce giant Alibaba Group Holding continues to defy trade tensions and a cooling economy, as sales surged 40% in the July-September quarter.
The New York-listed company on Friday posted better-than-expected revenue of 119 billion yuan ($16.9 billion) for the three-month period.
Areas outside of Alibaba's traditional business, primarily new retail initiatives such as its Freshippo grocery chain, now contribute nearly half of the growth in the company's core commerce revenue segment. Sales in cloud computing also grew 64% on the year to reach 9.3 billion yuan.
A $9.7 billion gain from Alibaba's acquisition of equity in affiliate Ant Financial in September lifted the e-commerce company's earnings, which also topped estimates at nearly $4.6 billion on a non-GAAP basis. Alibaba shares rose as much as 3% in morning trading.
The one-time gain also translates to a profit of 277 billion yen ($2.6 billion) attributable to SoftBank Group, a major shareholder of Alibaba. The Japanese group is scheduled to announce half-year results next week.
Alibaba's strong results come shortly before Singles Day, the company's annual shopping extravaganza, to be kicked off by American pop singer Taylor Swift. The retail festival centered around Nov. 11 saw about $30 billion in goods sold within 24 hours last year.
On Friday's earnings call, Alibaba executives also referred to new efforts such as livestreaming, in which merchants or influencers take to Taobao Live or other video platforms to boost sales, as a new consumption driver.
Daniel Zhang, who succeeded company founder Jack Ma as executive chairman, looked into Alibaba's third decade as he spoke about a five-year vision for future growth on the same call Friday, including a goal for annual gross merchandise volume to reach 10 trillion yuan by 2024 from 5.7 trillion yuan last fiscal year.
"We are identifying and executing new initiatives to convert the users from our China retail market business to users of the local services and the digital entertainment platforms," Zhang said. Alibaba operates food delivery platform Ele.me and video site Youku.
Alibaba's cross-border business also represents an important part of the company's expansion. Sales at Lazada, its online retail platform serving Southeast Asia, more than doubled for the fourth consecutive quarter. In September, Alibaba also acquired import e-commerce platform Kaola from NetEase to meet China's growing consumer demand for foreign goods.
The e-commerce company made inroads into China's rural areas and smaller cities as well, a market once seen as a niche occupied by younger rival Pinduoduo, to seek new growth.