Alibaba expected to report a drop in profits in quarterly results

Jack Ma's big spending cited as cause of e-commerce giant's projected profit decline

Alibaba is expected to post its first decline in profit in one and a half years when the e-commerce giant announces its latest quarterly report.

Analysts are attributing the projected decline to the folding of Alibaba’s loss-making businesses as well as increased spending in its battle with rivals such as Tencent.

According to Bloomberg, the e-commerce giant’s revenue is still expected to climb 53% to RMB 59bn ($9.3bn), however the figure indicates the company’s smallest growth in nearly two years.

Alibaba’s investment in new initiatives is cited as a major contributor to the declining revenue, along with its decision to invest more in businesses such as its finance division Ant Financial and local delivery service Ele.me.

Analysts also cited the-commerce giant's increased spending on its logistics company Cainiao and video platform Youku Todou, which is locked in a fierce battle with Tencent Video and Baidu’s iQiyi.

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