Alibaba Dealing With Counterfeit Issues Before Earnings Call

Alibaba is scheduled to release its earnings for this quarter in the coming week however it has been hit with the counterfeit goods issue yet again

Alibaba Group Holding is the Chinese tech giant which owns and operates several online marketplaces. A few of them are Alibaba.com which is the largest business to business platform and Taobao Marketplace which is a huge online marketplace for online shopping for consumers. The company has been named and accused many times for counterfeiting goods this year and every time it has tried to clear its name to sustain reputation in the market. The American Apparel and Footwear Association (AAFA), a US Trade Group, has been urging the government lately to put the company on the black list.

However, the founder and the chairman of the company Jack Ma stated that this issue will not only damage the reputation of the company but the economy of the country as well. The company has changed the checking criteria and also introduced strict background checks of sellers and all the products that go on the platforms.

But the company has been attacked with the accusations of counterfeiting goods on its platform yet again and it is all set to announce its earnings in the next week for the second quarter. The AAFA wants the government to list Alibaba Group in the list of ‘notorious markets’ and place it on the United States Trade Representative’s blacklist. Know that the company recent cleared off its name as its two platforms, Alibaba.com and Taobao, were blocked from 2008 till 2011 and 2012 respectively.

Regardless of all this, it is believed that the Alibaba stocks have started to gain momentum prior to its earnings release for the second quarter of 2015 fiscal year. It is not a massive increase in the stocks however it rose by 0.86 percent and is now trading at $72.61. The market capitalization of the company is valued at $180.87 billion.

It is believed that the earnings might fall down slightly due to the slow economic growth in China. Shareholders, investors, and analysts have said to be looking very closely at the earnings report this time. The online retailer is expected to post an Earnings per Share (EPS) of $0.54 in this quarter however it is slightly less than that of the previous quarter which was $0.59. But the year on year growth is expected to increase by 178.1 percent.