Alibaba Group Holding Limited BABA reported second-quarter fiscal 2018 (ended Sep 30, 2017) earnings of $1.29 per share, surpassing the Zacks Consensus of $1.04.Earnings were driven by solid growth in the company’s core e-commerce business, strong growth in metrics, international strength and growing cloud-computing services.Despite the strong second-quarter earnings, the results did not have any major impact on its share price. Its shares increased only 0.51% in the after-hours trading. Notably, the company's shares have gained 110.5% year to date, outperforming the industry’s gain of 59.9%.RevenuesAlibaba reported revenues of RMB55.12 billion (US$8.29 billion), increasing 9.8% sequentially and 60.7% year over year. Also, revenues came in above the Zacks Consensus Estimate of US$7.78 billion.The increase was driven by continued revenue growth in the China and International commerce retail business and strong improvement in Alibaba’s cloud business.Revenue by SegmentsStarting first-quarter fiscal 2017, Alibaba commenced segment reporting. It has four reportable segments — Core Commerce, Cloud Computing, Digital Media and Entertainment, and Innovation Initiatives. The details of these segments are discussed below.Core Commerce – This segment comprises marketplaces operating in retail and wholesale commerce in China, and international commerce. Revenues in the quarter were RMB46.46 billion (US$6.98 billion), reflecting an increase of 63% on a year-over-year basis.· China commerce retail business (72% of total revenues) – This business vertical’s revenues in the quarter were RMB39.6 billion (US$5.9 billion), reflecting an increase of 64% year over year. The increase was driven by robust growth in customer management and commission revenues as well as the consolidation of Intime starting in mid-May 2017.· China commerce wholesale business (3% of total revenues) – This business generated revenues of RMB1.71 billion (US$258 million), reflecting an increase of 19% year over year. The increase was due to a rise in average revenue from paying members on the company’s 1688.com platform.· International commerce retail business(5% of total revenues) – Revenues in the quarter were RMB2.88 billion (US$433 million), increasing 115% year over year. The increase was driven by growth in revenues generated from Lazada and AliExpress.· International commerce wholesale business (3% of total revenues) – This business generated revenues of RMB1.65 billion (US$248 million), increasing 10% year over year. The growth was due to an increase in online marketing revenues.· Others business (1% of total revenues) – This business generated revenues of RMB0.66 billion (US$0.99 million), reflecting an increase of 530% year over year.Cloud Computing – This segment comprises Alibaba Cloud, offering a complete suite of cloud services. Revenues in the quarter were RMB2.98 billion (US$447 million), up 99% year over year, driven by an increase in the number of paying customers and improved revenue mix to higher valued-added services.In the second quarter, Alibaba Cloud launched 245 new products and features to enable small and large enterprises to achieve higher computing performance and storage capability.Digital Media and Entertainment – The segment operates businesses through media properties, which includes UCWeb, Youku Tudou, OTT TV service, Alibaba Music and Alibaba Sports. Revenues were RMB4.80 billion (US$721 million), reflecting an increase of 33% on a year-over-year basis. The growth was driven by an increase in revenues from mobile value-added services provided by UCWeb, such as news feeds and mobile search, and an increase in subscription and advertising revenues from Youku Tudou.Innovation Initiatives and Others – This segment includes businesses such as the YunOS operating system, AutoNavi, DingTalk enterprise messaging and others. Revenues in the quarter were RMB887 million (US$134 million), up 27% year over year.Key MetricsMobile Monthly Active Users (MAUs) – Mobile MAUs were 549 million, improving 22% year over year and 4% sequentially. This was because of an increase in adoption of mobile devices by consumers, as the primary method of accessing Alibaba’s platforms. Annual Active Buyers – China retail marketplaces had 488 million annual active buyers in the 12-month period ended Jun 30, 2017, reflecting 11% year-over-year growth and 5% sequential growth.Operating ResultsPro forma gross margin was 60.1%, down 512 basis points (bps) sequentially and 615 bps year over year.Alibaba’s operating expenses of RMB16.5 billion increased 73.2% year over year.On a GAAP basis, Alibabagenerated net income of RMB17.4 billion(US$2.6 million) compared with RMB7.1 billionin the year-ago period.Alibaba generated adjusted net income of RMB22.1 billioncompared with RMB12.9 billionin second-quarter fiscal 2017.Balance SheetAlibaba exited fiscal second quarter with cash and cash equivalents and short-term investments of approximately RMB159.9 (US$24.0 million) billion against RMB148.2 (US$21.9 million) in the prior quarter.Cash Flow/Share RepurchaseCash flow from operations was RMB30.5 billion (US$4.59 billion) compared with RMB25.3 billion (US$3.73 billion) in the previous quarter. Free cash flow was RMB22.5 billion (US$3.38 billion) compared with RMB22.1 billion (US$3.27 billion) in the prior quarter.Alibaba Group Holding Limited Price, Consensus and EPS Surprise Alibaba Group Holding Limited Price, Consensus and EPS Surprise | Alibaba Group Holding Limited QuoteZacks Rank and Stocks to ConsiderCurrently, Alibaba Group has a Zacks Rank #3 (Hold). A few better-ranked stocks in the broader technology sector are NVIDIA Corporation NVDA and SMART Global Holdings, Inc. SGH, each sporting a Zacks Rank #1 (Strong Buy), while Applied Materials, Inc. AMAT, carrying a Zacks Rank #2 (Buy). You can seethe complete list of today’s Zacks #1 Rank stocks here.Long-term earnings per share growth rate for NVIDIA Corporation, SMART Global and Applied Materials is projected to be 11.2%, 15.0% and 17.1%, respectively.Looking for Stocks with Skyrocketing Upside?Zacks has just released a Special Report on the booming investment opportunities of legal marijuana. 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