Alibaba Group’s digital entertainment arm Alibaba Pictures reported a 35% year-over-year jump in revenue for the six months ended Sept. 30, due to the company’s investment in content.
Alibaba Pictures’ revenue climbed to RMB1.83 billion ($256.11 million) in the six months ending Sept. 30, a Hong Kong stock exchange filing showed on Tuesday. Its adjusted EBITA turned positive and reached about RMB149 million from a loss of RMB5 million in the same period last year.
Films and drama series brought significant revenue growth for Alibaba Pictures over the reporting period, despite the pandemic’s impact on the film market in China. Revenue from content saw a year-over-year increase of 85%, thanks to the strong performance of its films and drama series.
“The group focuses on creating high-quality content for the entertainment industry and increases its presence in the pan-entertainment industry through enhancing its dual engine technology-and-content strategy,” Alibaba Pictures CEO and Chairman Fan Luyuan said in the release.
The company produced and distributed 18 films that generated over RMB7 billion at the box office for the six months ending Sept. 30, accounting for 60% of the box office revenue of domestic films released during the reporting time.
A sports-themed drama series “Falling into You” ranked first in popularity for 20 consecutive days on Alibaba’s video and streaming platform Youku. Its blockbuster suspense drama series “Be reborn” ranked first in daily popularity for four consecutive weeks on TikTok.
Revenue from the technology segment, including its platform ticketing and digitalization business, remained stable compared with the same period last year.
Alibaba Pictures said it used its digitalization platforms to provide exclusive livestreaming marketing services and content marketing services for a number of its films and drama series. It also launched a live event management system for production crews during the reporting period to help improve production efficiency.
Intellectual property merchandising and commercialization, the other pillar of its core businesses, reported RMB223 million in revenue, on par with the same period over last year.
The company created a pop toy merchandise series featuring characters from its blockbuster drama series and variety shows. It also signed a five-year master licensing agreement with Japanese company Sanrio for the exclusive right to manufacture and sell merchandise of 26 Sanrio characters, including the iconic cartoon cat Hello Kitty.
Its launch of intellectual property merchandise coincides with a boom in the pop toy market in China. Sales in the toys category increased by 29% year-over-year on Alibaba’s e-commerce platform Tmall during the reporting period, according to the filing.