(Bloomberg)—Alibaba Group Holding Ltd.’s fiscal 2017 revenue increased 56.5% year over year to 158.27 billion yuan (US$29.99 billion) from 101.14 billion yuan in fiscal 2016.

Revenue from its core commerce business, which comes primarily from its Chinese online marketplaces Taobao and Tmall but also international shopping portals Alibaba.com and AliExpress, jumped 45.0% for the year to 133.88 billion yuan ($19.45 billion) from 92.34 billion yuan a year ago.

For the fiscal fourth quarter ended March 31, Alibaba’s revenue jumped 59.6% year over year to 38.58 billion yuan ($5.61 billion) from 24.18 billion yuan.

Its core commerce revenue in fiscal Q4 surged 47.1% to 31.57 billion yuan ($4.59 billion) from 21.46 billion yuan in its fiscal fourth quarter ended March 31. Alibaba’s marketplaces account for more than three-quarters of online retail sales in China yet it the e-commerce giant is not ranked in the Internet Retailer China 500 because it does not own any merchandise, instead operating platforms on which other merchants sell.

Alibaba’s earnings lagged estimates after it swallowed a higher tax bill and splurged on the entertainment and cloud computing businesses that are fueling revenue growth. The shares dropped the most in almost a year.

China’s biggest e-commerce company posted adjusted earnings-per-share of 4.35 yuan, missing the 4.51 yuan average of estimates compiled by Bloomberg.

While Chinese consumption remains strong, the world’s second largest economy showed signs of cooling as retail sales and industrial output growth sputtered in April with regulators cracking down on swelling financial leverage. Alibaba has expanded into new areas in response to the deceleration, buying control of Lazada Group SA to gain a Southeast Asian foothold and waging a price-based war with Tencent Holdings Ltd. in cloud computing services.

“The March quarter is usually a slow season for e-commerce so margins usually come down a bit,” said Ray Zhao, a Shenzhen-based analyst at Guotai Junan Securities Co. “Alibaba is spending a lot to drive growth in video and entertainment.”

It’s also trying to appeal to a growing middle class demanding premium products from Alaskan salmon to New Zealand milk. Growing Chinese affluence is propelling billionaire founder Jack Ma’s international expansion, which include helping a million American businesses tap Chinese consumers and reaching foreign shoppers through AliExpress.

Income tax expenses soared 149% to 4.6 billion yuan in the March quarter. Its effective tax rate climbed to 29% from 23% a year earlier, when the company set aside a portion of its earnings as non-taxable reinvestment capital. Alibaba said it also incurred additional taxes from the sale of certain unspecified investments. The company Thursday green-lit a $6 billion share buyback program over two years.

The strength of its e-commerce business is helping Alibaba weather losses in newer businesses of cloud computing and digital entertainment. While revenue in those nascent divisions is surging, they are yet to make money and costs are soaring as Tencent and Baidu Inc. vie with Alibaba for licensed content.

“Over time the market will become more rational, although in the near term there’s still going to be pretty fierce competition,” vice chairman Joseph Tsai told analysts on a conference call. Alibaba is “working with talent and directors on proprietary content, so over time the cost should come down.”

While cloud unit revenue doubled in the March quarter to 2.2 billion yuan, the business had an operating loss of 505 million yuan as it slashes prices to snatch market share from Amazon.com Inc., No. 1 in the Internet Retailer 2017 Top 500, and Tencent. It’s ratcheting up the division to support billions of dollars in daily transactions, help merchants target shoppers, and anchor fast-growing video streaming.

“Discount offers are necessary to expand Alibaba’s cloud market share,” Ella Ji, an analyst at China Renaissance Securities U.S. Inc. wrote in an April report. Alibaba will need “further spending to fill out its original content offerings.”

Revenue from digital entertainment more than tripled to 3.9 billion yuan with an operating loss of 2.6 billion yuan as it spends on content for video site Youku Tudou and other platforms. Losses in digital entertainment should narrow this year, chief financial officer Maggie Wu said.

For the fiscal fourth quarter ended March 31, Alibaba reported:

• Total revenue of 38.58 billion yuan ($5.61 billion), an increase of 59.6% from 24.18 billion yuan in the same quarter a year ago.
• Revenue from its core commerce properties, primarily its Chinese marketplaces Taobao and Tmall but also international shopping portals Alibaba.com and AliExpress, of 31.57 billion yuan ($4.59 billion), up 47.1% from 21.46 billion yuan.
• Net income of 9.85 billion yuan ($1.43 billion), up 85.5 from 5.31 billion yuan.
• Mobile active uses of its China retail marketplaces reached 507 million in March, an increase of 14 million over December. Consumers who made purchases during the 12-month period ended March 31 increased 31 million to 454 million.
• Revenue from the commerce segment accounted for 82.0% of third quarter revenue. Cloud computing accounted for 6.0%; its entertainment segment, including the Youku Tudou video website, contributed 10.0% of revenue; and what the company calls “innovation initiatives,” such as its AutoNavi navigation system and its lending to small businesses, accounted for 2.0%.

For fiscal 2017, Alibaba reported:

• Total revenue of 158.27 billion yuan ($22.99 billion), up 56.5% from 101.14 billion yuan a year earlier.
• Commerce revenue of 133.88 billion yuan ($19.45 billion), an increase of 45.0% from 92.34 billion yuan.
• Net income of 41.23 billion yuan ($5.99 billion), down 42.2% from 71.29 billion yuan.
• Revenue from the commerce segment accounted for 85.0% of annual revenue. Cloud computing accounted for 4.0%; its entertainment segment, including the Youku Tudou video website, contributed 9.0% of revenue; and what the company calls “innovation initiatives,” such as its AutoNavi navigation system and its lending to small businesses, accounted for 2.0%.