Key Points
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Alibaba’s e-commerce business shows tariff resistance.
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Tariffs minimally impact Alibaba Cloud, but other U.S. trade policies may pose risks.
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The company’s primary threat is considered to be the Chinese government rather than U.S. policies.
Alibaba Group Holding (NYSE: BABA) has largely managed to sidestep the impacts of U.S. tariffs, particularly due to the internal nature of its e-commerce business. Approximately 57% of its revenue derives from e-commerce, with about 75% of that coming from its Taobao and Tmall operations serving the Chinese market, insulating it from direct U.S. tariffs.
While Alibaba Cloud, a key growth area for the company, isn’t significantly affected by tariffs since it doesn’t provide services in the U.S., there could be indirect ramifications if Chinese businesses cut spending due to tariffs affecting them. Overall, analysts believe Alibaba will remain largely unscathed by tariffs, barring more severe measures, while the greater risk lies in regulatory challenges from the Chinese government.
