Alibaba Slumps on Chinese Antitrust Investigation By

© Reuters.

By Christiana Sciaudone —  Alibaba (NYSE:) slumped 14% after China said it is investigating the company for anticompetitive practices. 

The online giant hit a record in October, rallying some 50% since the start of the year, as people hunkered down at home to avoid the spread of Covid-19. Shares are down 30% since the all-time high.

Alibaba, built by billionaire Jack Ma, said it will cooperate with regulators. This isn’t the first time Ma’s businesses have attracted the attention of regulators.

Ma’s Ant Financial is also in the hot seat and set to meet with four Chinese financial regulatory agencies, the New York Times reported. That comes a month after Ant Financial had been set for a $37 billion initial public offering, the largest ever. But Shanghai Stock Exchange regulators abruptly suspended the offering, citing major issues with the group that “may fail to meet information disclosure requirements,” NPR reported last month.  

People’s Daily, the Chinese Communist Party’s newspaper, endorsed the inquiry into Alibaba, the New York Times reported.

“This is an important step in strengthening antimonopoly oversight in the internet sphere,” the article said. “This will be beneficial to regulating an orderly sector and promoting the long-term healthy development of platforms.”     

Alibaba’s results have surpassed expectations for the past seven quarters. In its most recent quarterly report, the ecommerce company published earnings per share of $18 on sales of $155 billion. In comparison, (NASDAQ:), in its most recent quarterly report, declared earnings per share of $12.37 on sales of $96 billion.

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