Alibaba Cloud made US$9.2 Billion in revenue for FY21 and grew 33% YoY.
They have ~38% market share of the cloud industry in China. Which is slightly more market share than AWS has in the US.
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$BABA cloud business is being completed missed by the market.
Let me explain why Alibaba Cloud, which makes up just ~10% of LTM revenues, could become worth more than the entire current market cap by FY25
Alibaba Cloud made US$9.2 Billion in revenue for FY21 and grew 33% YoY.
They have ~38% market share of the cloud industry in China. Which is slightly more market share than AWS has in the US.
In their investor presentation, $BABA projected that the cloud market in China will grow at a 37% CAGR until 2025.
The IDC estimated the CAGR to be 33% over the next 5 years.
The global cloud market is estimated to grow at 17.5% annually.
If we take the IDC’s more conservative annual growth estimation of 33%, and $BABA maintains their 38% market share, they would generate $28.8 billion of revenue in FY25.
Alibaba cloud even benefit from scale economies and continue to take more market share.
If we apply a 10x sales multiple we get to a $288 billion valuation for the cloud business in FY25.
Analysts typically value AWS, Azure & Google cloud at closer to 15x sales. So a 10x multiple for a company with more domestic market share and a higher CAGR isn’t unreasonable
The $288 Billion FY25 valuation is equal to 88% of the current $BABA market cap. Whilst it currently contributes to just ~10% of the total revenues.
The upside from Alibaba cloud is something the market seems to be missing, although it is uncertain.
I’ll discuss China’s cloud industry in depth in my newsletter write-up on $TCEHY which is out in a few days.
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Always. No, your company is not an exception.
A tactic I don’t appreciate at all because of how unfairly it penalizes low-leverage, junior employees, and those loyal enough not to question it, but that’s negotiation for you after all. Weaponized information asymmetry.
Listen to Aditya
And by the way, you should never be worried that an offer would be withdrawn if you politely negotiate.
I have seen this happen *extremely* rarely, mostly to women, and anyway is a giant red flag. It suggests you probably didn’t want to work there.
You wish there was no negotiating so it would all be more fair? I feel you, but it’s not happening.
Instead, negotiate hard, use your privilege, and then go and share numbers with your underrepresented and underpaid colleagues. […]
Always. No, your company is not an exception.
A tactic I don’t appreciate at all because of how unfairly it penalizes low-leverage, junior employees, and those loyal enough not to question it, but that’s negotiation for you after all. Weaponized information asymmetry.
Listen to Aditya
"we don't negotiate salaries" really means "we'd prefer to negotiate massive signing bonuses and equity grants, but we'll negotiate salary if you REALLY insist" https://t.co/80k7nWAMoK
— Aditya Mukerjee, the Otterrific \U0001f3f3\ufe0f\u200d\U0001f308 (@chimeracoder) December 4, 2018
And by the way, you should never be worried that an offer would be withdrawn if you politely negotiate.
I have seen this happen *extremely* rarely, mostly to women, and anyway is a giant red flag. It suggests you probably didn’t want to work there.
You wish there was no negotiating so it would all be more fair? I feel you, but it’s not happening.
Instead, negotiate hard, use your privilege, and then go and share numbers with your underrepresented and underpaid colleagues. […]