Alibaba records only 9% lower profit than Amazon but trails by four times in revenue

Amazon Founder and CEO Jeff Bezos.

Amazon Founder and CEO Jeff Bezos.

Data gathered by Learnbonds shows that Chinese internet company Alibaba registered 9.3% lower profits compared to United States’ Amazon. The data further shows that there is a significant gap in revenues between the two companies by at least four times for the financial year ending March 31, 2020.

For the period under review, Alibaba’s operating profit was $12.9bn, while Amazon had $14.1bn. In general, Amazon’s total revenue was $296.3bn compared to Alibaba’s $72bn. The revenues for the two companies come from different diversified products like online and offline retail as well as seller and logistics services.

The Learnbonds research notes that: “Chinese e-commerce giant Alibaba registered a slightly lower margin in operating profits compared to Amazon, but there exists a huge difference in total revenue between the two platforms.”

Under the core commerce revenue, Amazon registered $223bn while Alibaba had $61.6bn. For the cloud revenue, Amazon had profits of $37.5bn, a difference of 147.2% compared to Alibaba’s $5.7bn. Under other revenues, Amazon recorded $35.7bn while Alibaba had $4.7bn.

The research also overviewed the revenue for the twp companies over the last three financial years. In general, Amazon remains dominant but both companies keep growing in revenues.

Alibaba’s current revenue of $72bn is a growth of 36.62% from 2019’s $52.7bn. For Amazon, this year’s revenue grew slightly by 5.6% from last year’s $280.5bn. In 2018, Amazon’s revenue stood at $232.8bn while Alibaba had $35bn. Between 2017 and 2020’s financial year Amazon’s revenue has grown by 66.64% compared to Ali baba’s 225.79%.

Both Amazon and Alibaba have a similar business model but the American company has an established footing globally. In recent years, Alibaba has been making attempts to overhaul its business model to march Amazon.