Alibaba leads rally in Chinese tech stocks after reporting strong Q1 sales
David Becker

Chinese tech stocks rallied Thursday as the sector rose in the wake of Alibaba (NYSE:BABA) reporting first-quarter results that handily beat Wall Street's estimates.
Alibaba (BABA) gained more than 6% in premarket trading as investors threw their support behind the Chinese Internet and e-commerce giant following its latest earnings update. For the period ending June 30, Alibaba (BABA) said it earned $1.75 a share, excluding one-time items, on $30.69B in sales, as the company's China commerce segment declined 1% year-over-year.
Analysts were expecting Alibaba (BABA) to earn $1.56 a share on $30.16B in sales.
âDespite the challenges posed by the Covid-19 resurgence, we delivered stable revenue performance year-over-year," Chief Financial Officer Toby Xu said in a statement.
With Alibaba (BABA) in the lead, while JD.com (NASDAQ:JD) climbed almost 5% and Pinduoduo (NASDAQ:PDD) shares tacked on more than 6%. 
Baidu (NASDAQ:BIDU), Bilibili (BILI) and Kingsoft Cloud Holdings (KC) each rose more than 2%, while NetEase (NTES) bucked the trend and slipped into lower.
The KraneShares CSI China Internet ETF (KWEB) also rose sharply, tacking on nearly 3%.
Even though Chinese commerce did not experience much growth year-over-year, Alibaba (BABA) said the June 18 Shopping Festival saw positive gross merchandise volume year-over-year, with "especially strong purchasing demands" from the company's 88VIP members. 
Xu added that Alibaba (BABA) has narrowed losses in its key businesses, citing ongoing improvements in operating efficiency and increasing focus on cost optimization. 
Alibaba (BABA) also bought back 38.6M ADS for approximately $3.5B during the quarter. The company has approximately 2.6B ADS, the equivalent of 21.2B ordinary shares outstanding and has $12B left in its stock buyback program.
Late last month, Alibaba (BABA) said it was planning a listing in Hong Kong, with Alibaba Chief Executive Daniel Zhang calling it a "launch pad for Alibaba's globalization strategy."
On a conference call to discuss Alibaba's (BABA) results, Zhang highlighted two new additions to the company's board of directors, as well as the company's plans to focus on narrowing losses in the months ahead.
Earlier this week, Alibaba (BABA) said it would "strive" to keep its New York listing after the Securities and Exchange Commission said it may delist the company amid auditing concerns.