(March 19): Ant Group Co’s quarterly profit plunged 91% after the Chinese digital payments firm ramped up spending to compete in artificial intelligence (AI) and healthcare, while a decline in the fair value of certain investments weighed on results.
The Hangzhou-based company contributed CNY393 million (US$57 million or $73.37 million) of profit to Alibaba Group Holding Ltd, which owns a third of Ant. That translates into an estimated CNY1.2 billion in profit for the three months ended Sept 30, according to Bloomberg calculations based on Alibaba’s earnings report.
Alibaba’s revenue rose a slower-than-anticipated 2% in results for the three months ended December posted on Thursday. Ant, whose results lag behind Alibaba’s by a quarter, declined to comment.
Ant, the operator of China’s ubiquitous financial services app Alipay, has been investing in AI to find a second chapter following a regulatory crackdown that wrapped up about two years ago. The company has invested hundreds of millions of dollars in digital healthcare and built robots, while its global unit is expanding in cash management.
The firm’s Singapore-based international arm brought in US$3 billion of revenue for 2024, paving the way for a potential initial public offering of the unit.
Ant also made progress on its move to acquire a Hong Kong brokerage. The company won approval from China’s regulators to complete its purchase of Bright Smart Securities and Commodities Group Ltd, clearing the way for a deal agreed nearly a year ago.
See also: Samsung to invest record US$73 bil in AI chip comeback bid
Ant last year showcased its first humanoid robot, which can provide medical consultation and perform basic kitchen tasks. It is building out its healthcare app AQ, which has served 140 million users as of September.
In 2023, an Ant share repurchase proposal valued the company at about US$79 billion, well off the US$280 billion it was valued at during its attempted IPO in Shanghai and Hong Kong in late 2020.
Uploaded by Tham Yek Lee
