A little over a year ago, with Alibaba facing an antitrust probe and founder Jack Ma under political pressure, CFO Maggie Wu was quick to address investors about the company’s fast-growing and undisputed cloud business.
“China will be the largest economy in 10 years, companies and millions of companies will migrate to the cloud,” she said at a Goldman Sachs conference last February, according to reports to the Financial Times.
But Wu’s guesses that Ali Cloud’s 50 percent annual growth rate was sustainable proved overly optimistic. Today, growth in the cloud computing space is stagnant, with revenue up just 12 percent year over year in the first quarter of 2022. Top rival Tencent reported that its cloud arm has shrunk over the same period.
The faltering cloud companies show how China’s tech giants are struggling to regain their footing while battling a regulatory onslaught from Beijing and a slowing economy…