Alibaba Group (NYSE:BABA) has pulled plans to spin off its cloud business and paused proposals to list its supermarket unit, throwing into doubt its restructuring plans.
The Chinese e-commerce giant said US export controls had created “uncertainties” for its cloud business, and that it had paused plans to list its grocery business Freshippo as it “evaluate[s] market conditions.”
The company said new export control rules may “materially and adversely” affect Cloud Intelligence Group’s ability to offer products and services and to perform under existing contracts.
As a result, the firm said it believes that a full spin-off of Cloud Intelligence Group may not achieve “the intended effect of shareholder value enhancement.”
The Freshippo plan for an initial public offering (IPO) has been put on hold as “we evaluate market conditions and other factors that would contribute to a successful transaction to enhance shareholder value,” the company said.
In March, Alibaba said it would split its businesses into six units to unlock shareholder value and stimulate growth.
Thursday’s announcement came as Alibaba’s third-quarter results fell below analyst estimates.
Alibaba said revenues in the quarter to September rose 9% to Rmb224.8 billion ($30.8 billion), below the consensus estimate of Rmb272 billion.
Net profit was Rmb27.7 billion, up from a net loss of Rmb20.6 billion a year earlier.
Eddie Wu, chief executive, described it as a solid quarter but shares fell more than 7% in pre-market trading.