What's Going On With Alibaba Stock Tuesday?

Alibaba Group Holding Limited (NYSE: BABA) stock is trading lower Tuesday while rival ByteDance, the parent company of TikTok and Douyin, has shown remarkable growth in the second quarter of 2023, with a reported revenue surge of 40% to $29 billion, overshadowing its rivals. 

Last week, Alibaba reported second-quarter FY23 revenue growth of 9% year-on-year to $30.81 billion, beating the consensus of $30.77 billion.

Adjusted earnings per ADS of $2.14 beat the consensus of $2.11. 

ByteDance's success is partly due to its foray into online shopping through Douyin, its domestic short video app, directly competing with Alibaba's e-commerce dominance, SCMP reports.

Alibaba, a major player in the e-commerce sector, generated around half of its total sales from its core e-commerce business. Despite its strong market position, Alibaba faces increasing competition from ByteDance, primarily as Douyin, with over 600 million daily active users, increasingly relies on e-commerce as a key revenue source.

Alibaba continues to be a heavyweight in e-commerce, but ByteDance's diversification into various digital services, including e-commerce, is reshaping the competitive landscape. 

Now, Alibaba looks to focus on an AI-driven technology businesses, and global commerce networks after it decided to halt the spin-off of its cloud unit due to U.S. export restrictions on advanced chips.  

Alibaba's rival Baidu, Inc (NASDAQ: BIDU) reported a third-quarter FY23 revenue growth of 6% year-on-year to $4.72 billion, missing the consensus of $4.79 billion. 

Baidu's adjusted earnings per ADS of $2.80 beat the consensus of $2.32.

Price Action: BABA shares traded lower by 0.43% at $78.11 premarket on the last check Tuesday.