The first quarter net profit of Alibaba.com Ltd., China's largest e-commerce company, slumped 25 percent year on year as the firm settled into a readjusted business model, according to financial results released on Monday.
The Hong Kong-listed arm of Alibaba Group said its net earnings in the three months to the end of March 2012 reached 339 million yuan (53.7 million U.S. dollars), also 12.1 percent lower from a quarter ago.
Meanwhile, first-quarter revenues climbed 3.7 percent year on year, but fell 4.2 percent quarter on quarter, to 1.59 billion yuan.
The company started to upgrade its business model last year to improve services for its customers. The shift, though a must, could affect corporate performances in the short and medium term, it said.
As a result, its paid clients fell 1.5 percent from the end of last year to 753,955.
In February, Alibaba Group offered to privatize Alibaba.com Ltd. at a price of 13.5 Hong Kong dollars per share.
Alibaba.com Ltd.'s strategic shift to long-term value creation may affect its revenue growth and limit earning visibility in the foreseeable future, the company said then.
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