Alibaba sales and earnings buck the economic trend

Company's fledgling cloud computing unit is star performer

Alibaba Group Holding Ltd showed once again that a slowing Chinese economy isn't holding it back.

The country's largest operator of internet shopping malls posted sales and earnings that beat analyst estimates as revenue easily outstripped economic growth.

Moreover, Alibaba's fledgling cloud computing business more than doubled sales and almost broke even, a significant feat for a capital-intensive business.

The results come about a week before Katy Perry kicks off Alibaba's annual Singles Day event (Nov 11), the world's biggest 24-hour shopping promotion and a closely watched barometer of Chinese consumer demand. Alibaba continues to capture a greater share of digital advertising as users shift to mobile devices and marketers spend more money online to reach them.

"I don't know if anyone's doing better than Alibaba," said Gil Luria, an analyst at Wedbush Securities Inc, commenting on Chinese internet companies. "They were able to drive growth by expanding beyond e-commerce in mobile browsing, media, cloud and continued to increase their number of ads and the money they charge for it."

Revenue rose 55 percent to 34.3 billion yuan ($5.1 billion) in the quarter, surpassing the 33.9 billion-yuan expected by analysts. Alibaba's quarterly sales have now beaten estimates for five straight quarters and have missed only twice since its record IPO in 2014.

Shares of Alibaba rose as much as 2.7 percent in early trade on Wednesday. The stock has gained about 24 percent after a 22-percent dive in 2015, when the company grappled with the slowdown and lawsuits accusing it of being slow to remove counterfeits from its websites.

While core commerce revenue rose 41 percent to 28.5 billion yuan in the September quarter, the cloud unit was the star performer.

The division, which competes with Microsoft Corp and Amazon.com Inc, grew sales by 130 percent and narrowed its loss to 57 million yuan after more than doubling the number of paying customers to 651,000.