Chinese last mile service provider, Cainiao Network, is operating at positive cashflow according to parent company, Alibaba Group.
Daniel Zhang, Alibaba Chairman and CEO, said China was the only major economy to achieve positive Gross Domestic Product (GDP) growth last year.
For the quarter ended 31 December 2020, Alibaba delivered a solid quarter with revenue growth of 37 per cent year-over-year and adjusted EBITDA up 22 per cent year-over-year.
“Our strong cash flow enabled us to further invest in strategic areas,” said Alibaba Group Chief Financial Officer, Maggie Wu.
These strategic areas include cloud computing and the Cainiao Network.
Wu said progress here reflects the company’s long-term approach to incubate and expand businesses from launch to profitability.
In the December quarter, Cainiao Network revenue grew 51 per cent year-over-year to approx. $1.7 million USD, primarily due to the increase in volume of orders fulfilled from the company’s fast growing cross-border and international commerce retail businesses.
“Cainiao Network continued to expand both its domestic services and global smart logistics infrastructure by deepening integration with logistics partners as well as offering more products and services,” Alibaba said in a statement.
“In China, Cainiao and its partners processed over 2.3 billion orders during the 11.11 Global Shopping Festival while continuing to improve delivery time to enhance consumer experience.
“Internationally, Cainiao and its partners continued to invest in smart logistics infrastructure to serve our global merchants and to help alleviate logistics capacity constraints caused by the Covid-19 pandemic.
“In December 2020, Cainiao deployed more than 200 international chartered cargo flights for our AliExpress business, which resulted in improved fulfilment efficiency for AliExpress orders and a reduction of average delivery time by 3.5 days for order deliveries from China to international markets.”
Alibaba Group reported revenue of approx. $33.8 million USD, an increase of 37 per cent year-over-year, for the quarter ended 31 December 2020.