Good day, ladies and gentlemen. Thank you for standing by. Welcome to Alibaba Group's March Quarter 2015 and Full Fiscal Year 2015 Results Conference Call. [Operator Instructions] I would now like to turn the call over to Ms. Jane Penner, Head of Investor Relations of Alibaba Group. Please go ahead.

Good day, everyone, and welcome to Alibaba Group's March Quarter 2015 and Full Fiscal Year 2015 Earnings Conference Call. With us are Joe Tsai, Executive Vice Chairman; Daniel Zhang, incoming CEO; Maggie Wu, Chief Financial Officer. Also, as you know, we distribute our earnings release through Alibaba Group's Investor Relations website located at www.alibabagroup.com, so please refer to our IR website for our earnings releases as well as for the supplementary slides that accompany the call. You can also visit our corporate website for the latest company news and updates. Please check it out. This call is also being webcast from our IR section of the corporate website. A replay of the call will be available on our website later today. Now let me quickly cover the Safe Harbor. Today's discussion will contain forward-looking statements made under the Safe Harbor provisions of the U.S. Private Securities and Litigation Reform Act of 1995. These forward-looking statements involve inherent risks and uncertainties that may cause actual results to differ materially from our current expectations. Factors that could cause actual results to differ materially are set forth in today's press release. To also understand these risks and uncertainties, please refer to our Form F-1, as amended, originally filed with the U.S. Securities and Exchange Commission on May 6, 2014. Any forward-looking statements that we make on this call are based on assumptions as of today, and we do not undertake any obligation to update these statements, except as required under applicable law. Please note that certain financial measures that we use on this call, such as non-GAAP EBITDA, including non-GAAP EBITDA margin and non-GAAP net margin -- I'm sorry, net income, are expressed on a non-GAAP basis. We have also adjusted our net cash provided by operating activities to remove purchases of property and equipment and intangible assets, excluding acquisition of land use rights and construction in progress, and adjust for changes in loan receivables relating to microloans of our SME loan business, which we refer to as free cash flow. Our GAAP results and reconciliations to GAAP -- of GAAP to non-GAAP measures can be found in our earnings press release. With that, I will now turn the call over to Joe.

Good evening or good morning, depending on where you are. Thank you all for joining. Before we get to the results for the quarter, you will have seen that we reported some important news. Today, we have announced that Daniel Zhang will become CEO of Alibaba Group effective May 10. Our current CEO, Jonathan Lu, will work with Daniel to ensure a successful transition in the coming months. Jonathan will remain on the Board of Directors of Alibaba Group as Vice Chairman. In this capacity, Jonathan will play an important role in developing the future leaders of Alibaba Group. We have a strong and deep bench of talented executives who will help lead the company for years to come, and today's announcement reflects our commitment to continuing to develop strong leadership from within. On behalf of Jack Ma and the entire Alibaba family, I want to express our personal gratitude to Jonathan Lu for his strong leadership and management over the past several years, and we all look forward to his continued contribution as a key leader. Most of you have met and know well our new CEO, Daniel Zhang. Daniel has been with the company for 8 years. He has successfully managed important businesses across our organization, and he is one of the founding members of the Alibaba Partnership. Daniel is a proven business leader and innovator, with a strong track record of delivering results. He has the confidence of our entire management team, and there is no better person to lead Alibaba Group as we embark on the next stage of our growth. This management transition is part of our progress to build the commerce infrastructure of the future. In addition to investing in cloud computing, logistics, Big Data technology, cross-border trade capability and our ecosystem partners, we…

Thank you, Joe. Hello, everyone. I'd like to start by reviewing some highlights of our fiscal 2015 operational and financial results. USD 394 billion of GMV was generated on our marketplaces in fiscal 2015. Active buyers in the last 12 months grew to 350 million. Mobile MAUs grew to 289 million. We earned USD 12.3 billion in revenue, representing a 45% increase from the revenue generated in fiscal 2014. And our non-GAAP free cash flow generated in fiscal 2015 was USD 7.8 billion. Looking back at fiscal year 2015, I want to briefly discuss our key strategic accomplishments. Number one was the significant expansion of our ecosystem. We grew our active buyers, especially in rural areas, and improved services and tools for our important -- for our sellers. We also expanded key categories and upgraded our logistic infrastructures. Number two was our unrivaled mobile leadership. We made a big push for the Mobile Taobao App this year, and it was very successful. Our mobile GMV grew 212% in fiscal 2015, driven by incredible net adds of 126 million mobile users. Over 50% GMV came from mobile devices during the final quarter of 2015, and we ended the year with 289 million mobile MAUs. Number three [ph] was our investment in data and cloud computing platform. We remain the #1 cloud service provider in China. In fiscal 2015, we made technology improvements and with -- that significantly increased our power efficiency, and we expanded and diversified our customer base. Number four was our pioneer cross-border commerce. Tmall Global captured consumer mind share as a source of high-quality products, and we attracted major global brands and retailers to our platform. We also established a strong cross-border logistics infrastructure. Number five was strategic M&A investments and alliances. We invested or partnered with the 5 different areas in 2015: mobile, entertainment, e-commerce and logistics, O2O/travel and healthcare. That's the end of business review. I'd like to turn back to Maggie for financial review.

Okay. Thank you, Daniel. Hello, everyone. Here are some highlights for the financial results. GMV grew 40% year-over-year to RMB 600 billion. Revenue grew 45% year-over-year to RMB 17.4 billion. Non-GAAP EBITDA margin was 49%, down from 57% in the year-ago period. Non-GAAP net income grew 16% year-over-year to RMB 7.7 billion. Diluted non-GAAP EPS, excluding SBC and amortization of intangible assets and certain other items, was RMB 3, an increase of 7% compared to RMB 2.8 in the same quarter of 2014. In the March quarter, our blended monetization rate was 2.17% versus 2.18% in the year-ago period. The PC monetization rate was 2.63% versus 2.63% in March quarter 2014. Our mobile monetization rate has continued to improve, from 0.98% in March quarter last year to 1.73% this quarter. However, please note that we implemented certain measures in the year-ago quarter that artificially constrained mobile monetization rate in order to ensure user experience, so this quarter's mobile monetization rate has a relatively easy comparison to our March quarter 2014. Starting mid-June quarter 2014, we began to phase out these measures. Going forward, we expect improvement in mobile monetization to be driven by our ability to deliver more value to customers. Remember, improvement in mobile monetization may not always be linear, given seasonality and other factors that change each quarter. But we continue to strongly believe that the long-term trend in mobile monetization is positive. Year-on-year, our revenue grew 45% to RMB 17 billion, primarily driven by an increase in new active buyers. Both Taobao and Tmall GMV grew very well this quarter. However, Taobao GMV year-on-year growth was disproportionately impacted by the late timing of Chinese New Year holiday, while Tmall was not impacted as much due to special holiday promotions. Other revenue grew 169% on year-on-year basis in…

Thank you, Maggie. Finally, I would like to add a few words about our priorities in the coming year. Our 2016 priorities fall into 3 main categories: expanding and upgrading our existing platform services, developing new businesses and people development. In the first category, expanding and upgrading our existing services, we will focus on quality GMV growth; costumer acquisition, with particularly emphasis on mobile and rural users; empowering sellers to better serve customers, especially on mobile; local services. In the second category, developing new businesses, our focus will be primarily on cloud computing, specifically extending services for a broader base of third-party customers; cross-border, especially the import business; building up our affiliate marketing network; developing mobile Internet services; and investing in entertainment. Finally, underlying all these priorities is the ongoing necessity of developing talent and building up our organization and culture. The size and scope of our ecosystem requires us to hire, retain and cultivate employees who can adapt to a dynamic, competitive and challenging business environment. Our success in doing this is the foundation of the future growth and the sustainability of our business, and it will be one of our biggest priorities in 2016 and beyond. That is the end of our prepared remarks. Operator, let's open the phone lines for Q&A.

[Operator Instructions] Your first question comes from the line of Erica Poon Werkun from UBS.

My first question is on monetization. Can you give us an update on how the merchants have responded to the changes in advertising tools, including the longer-tailed keywords and ranking algorithms? I know that after the year-on-year decline in the non-mobile take rates in both the September and December quarters, the take rate stabilized in the March quarter. Would you say that you've seen an inflection point? What's your outlook on the trend for non-mobile take rate, please? My second question is on your ever-growing ecosystem. Can you just share some color on what will be some of the key focus areas of expansion in fiscal '16?

First of all, I would like to say that we don't manage our business by mobile and non-mobile, and we view this as an integrated platform and our consumers do online shopping across platforms. So it's a unified platform. In terms of take rate, I would say, today, more and more stuff and more and more sellers, they get used to do business on mobile because they observe that consumers shift from PC to mobile. So they are doing business on mobile and they start spending money on mobile to promote their storefront and items. And if you look at our take rate on the PC side, I will say, actually, the marketing revenue on the PC side in terms of the CPC and the click-through rate, and the spending actually still increased this quarter, offset by the increase in the commission revenue in this quarter. Because actually, in this quarter, we promote -- we had a quite good promotion in Tmall in the Chinese New Year and in March. So this is a upside. Then on the mobile side, actually, with development of the marketing tools and people will spend more money on mobile to promote their storefront.

So in terms of the area we're going to keep investing, so as we mentioned, the areas we invest in, in the past year, including these cloud computing, digital entertainment, local service and our mobile Internet services, we will continue making investment in these areas, keep expanding these new business.

The next question comes from the line of Zhao, Ming from 86Research.

Congratulations, Daniel, on your new role. Two questions. The first question is actually about the management change. We see that happening to the Head of Tmall. We see that happening to the Head of Alimama and now CEO of the group. So my question is, should we understand that this management change or restructuring in the group is pretty much done and we should see some positive change in the business starting from second quarter? That's my first question. The second question is a housekeeping question about your lottery business. It's been ceased in March month. How much of an impact that is on your GMV in March? Would you say it's kind of low single-digit GMV and mid-single-digit revenue? Any color would be helpful.

Yes, Chun Ming, this is Joe Tsai. I'll talk about the management change question. This is really -- I mean, Alibaba is always very good at continuously developing and improving the management of our company. And I think with the CEO transition of Daniel, we have also brought in some younger folks to run some of the core businesses like Tmall. As you know, Jeff Zhang who was running Taobao Marketplace is now running both Tmall, Taobao Marketplace and also Juhuasuan, so he has all the e-commerce marketplaces underneath him. We also have some other terrific executives in other leadership positions, in B2B, in cloud computing. In the case of the Alimama marketing platform, we, through the acquisition of UCWeb, we were able to brought on board a very strong executive in Yu Yongfu, and he has proven over the months of integration, to bring a lot of value to and insight to our business. And so we decided that it was appropriate and the right time for him to take over the Alimama business. But this is a process that we are continuously undergoing. We always are looking for talented, young executives to take on more responsibility. And we're extremely thrilled to have Daniel taking over the leadership of this group with the wholehearted support from management.

Chun Ming, this is Maggie. Regarding your second question on the lottery business. The lottery business grew really fast. It got -- it's suspended according to the new rules policy at the end of February. But it still represents a small portion of our business. It represents low single digit regarding the GMV as well as the revenue.

The next question comes from the line of Eddie Leung from Merrill Lynch.

Two questions. The first one is a little bit follow up on some of the reported potential regulation changes. Recently, Ministry of Commerce proposed to require all online merchants to have business registration and operating licenses. So I'm just curious, would that affect the individual sellers on Taobao? I'm not too concerned on Tmall, but more on Taobao. And separately, another question is about your cloud computing initiative. Just wondering if Daniel could provide a bit more color in that business. For example, what would be the key customer industries you have right now, the key service that they are using? Any color along that line would be great.

Okay. For the first question, actually, we are -- we have very smooth conversation with the government. And for the Ministry of Commerce, I think they are talking about the new regulation. And so far, we don't think this will impact our merchants. And because, today, the government is -- actually they encourage the SMEs and the entrepreneurs to start new business and create jobs. So we believe that in our Taobao Marketplace, we really give people the chance to start a new business. So we think that this, ultimately, is helpful for the people, for the business development and for the new entrepreneur.

Yes, for the -- Eddie, for the customer type with our cloud computing business, it includes start-ups, it includes enterprises, government, so it's pretty diversified.

The next question comes from the line of Robert Lin from Morgan Stanley.

So 2 questions. I think, overall, it looks, it appears your business units are under a lot of restructuring and were verticalizing, meaning our 3 business unit is now doing a lot more deeper things and restructuring. Can you help us to understand the key objectives of some of these key BUs? We notice that Juhuasuan and Tmall, a lot of the big brands are -- we are encouraging them to come into that platform. Maybe give us a sense on what we expect from these new restructuring goals? And I guess, the second question is related to mobile GMV. I think the conversation of Jeff Zhang to some of the sellers in recent weeks was that GMV from mobile could potentially be 70% by the end of the year. Is that something we can confirm for the audience?

Okay, this is Daniel. I will answer the first question. When we look at the restructuring of the team and business, first thing we will think, how to -- in what kind of organization structure is a benefit for the customers. So for example, today, and a lot of Tmall merchants, they are the power seller and they're doing the day-to-day operation on Tmall platform, but they need a space to promote or to have a big event for them. So that's what exactly the Juhuasuan can provide. So to put all these Tmall business and Juhuasuan into one head, Jeff Zhang, I think is benefit for the customer and can give customers a one-stop solution in terms of the daily operation and promoting events. And second factor when we consider in the restructuring is that how to leverage our internal resources and improve the operating efficiency. So put all the Taobao, Tmall and Juhuasuan under one head, actually we can have each of these 3 platforms have a very strong unique position. The head, the BU head, they can -- he can oversee the entire business and to promote SMEs in Taobao and to serve the brand companies, the retailers in Tmall and give the promotion platform in Juhuasuan. So we believe this can help us to improve and grow our efficiency and reduce our internal conflicts.

Yes, regarding question on mobile GMV as a percentage of total GMV, I think it's hard for us to tell precisely whether it's going to be exceeding 70% in the coming year. But what I could share with you is that when you look at this quarter's mobile GMV, it already accounts for more than half of our total GMV. So that growth on mobile business pretty much exceeds everybody's expectations, and that trend is continuing.

The next question comes from the line of Alan Hellawell from Deutsche Bank.

We saw a nice rebound in year-on-year ad revenue growth in the March quarter, I think at 29% versus 18% in the December quarter. I think you probably mentioned some constituent factors behind that. I think Maggie mentioned relaxation of measures around mobile monetization. But I was hoping you could give us a hierarchy of the most important drivers behind this recovery and also how you think about growth over the next few quarters. And then would love -- and my second question, would love any additional color about actual mix shift as the driver of commissions and how we see that going forward?

Yes, Alan, this is Maggie. So in terms of online marketing revenue, the growth rate is much higher than what you see last quarter. The growth is actually coming from the mobile, mobile part of the online marketing revenue. So in the mobile part, you can see that the mobile GMV grow so significantly, so that's the key driver. So going forward, it depends on the mobile GMV and how we improve the mobile monetization, then that could all impact the online marketing revenue growth.

And sorry, Maggie, just on that topic, what -- can you give us a little more detail on the relaxation of mobile monetization that you mentioned? Are there any -- can we quantify some of the measures that were taken?

Yes, we are not actually disclosing any further granularity, but what I can share is that from all of these traffic and CPC and the conversions, all of these are factors we see pretty encouraging growth.

The next question comes from the line of Alicia Yap from Barclays.

I actually have a follow-up question on Alan's question previously. So I guess, on the re-acceleration on the online marketing, so I wanted to also get some update if you have any latest update on the algorithm change that we mentioned last quarter. And also, wanted to see will these re-accelerations to continue going forward? And then for second question is on the Taobao GMV. Can we also quantify or maybe give us some color, how should we look at the growth trend going forward?

Yes, Alice, all of the efforts we're making and we mentioned last quarter, these are all continued efforts and these are not limited efforts we make. The purpose of all this is to improve user experience, enhance the user engagement, so that process will be a continued process. So we believe that as long as we keep improving the user experience, then the monetization will come. The second question?

Yes, for the second question, Taobao GMV experienced a slowdown in the first quarter. The main reason is quite simple, it's the late Chinese New Year. We saw a rebound in March in Taobao GMV, and we will continue to promote the SMEs in Taobao Marketplaces. And we think that we can -- Taobao can show people a very unique experience, to give people a very unique experience in that, in selections.

I see. Can I follow up, Daniel, on that Taobao GMV, on the Chinese New Year reason. Will that also impact Tmall or is it less on Tmall?

Well, it's a good question. Actually, this is really impact less on Tmall. The reason is that, in Taobao, most of the sellers are small sellers. So when they are coming to a holiday, they will -- because they are, their cash flow is quite tight. A small business always have a relatively tight cash flow, so they will pull back the inventory purchase and the stock to reduce stock to a lower level. But for large sellers in Tmall and they have quite flexible cash management. So that's why in Taobao, a lot of individuals, they will planning [ph] their stock during the Chinese New Year, and actually before Chinese New Year, until 2 weeks after Chinese New Year. And this year, because of a late Chinese New Year and we also had some impact in early March, so the business rebounded in the second half of the March, so that's why we experienced a slowdown in the first quarter in Taobao.

I see. Can I also follow up on [Audio Gap] monetizations actually help the online advertising revenue side? Should we assume that's also mainly come from the Tmall merchants that are also putting more ads on the mobile?

Yes, Alice, we don't really separate the Taobao Tmall merchants' revenue contribution, so it's -- because Tmall merchants can also put down ads for P4P and Taobao Marketplace. So yes, we just look at it as a whole, overall one marketplace.

The next question comes from the line of Carlos Kirjner from Bernstein. Carlos Kirjner - Sanford C. Bernstein & Co., LLC., Research Division: Two questions. Can you talk a little bit about the adoption of the Tmall mobile app versus the Taobao app? Do you see a future when, where users have 2 apps, 1 app, 2 apps that are deep-linked? And if that's the case, why would you have 2? How does that evolve? And secondly, Joe, in the transcript you said that mobile gives you an opportunity to offer better service to users and value for merchants. Why is that? Is there better conversion in your mobile than PC? And hypothetically, if it was up to you, in 3 years, would you have users come into the marketplaces over a mobile platform or over a PC?

Okay, for the first question, actually we -- last year, we view the Taobao mobile app as a top priority, so input a lot of resources in the company to -- in the development of our Taobao mobile app and promote our -- in the promotion of our Taobao mobile app. And this also gives us very good results. And today, people can go into Taobao mobile app to search and to navigate and find whatever they want from Taobao and Tmall. But also, people can go into Taobao mobile app first, then click the button of Tmall, then go to the page -- webpage of Tmall and start their journey in Tmall. But as you said, actually, we do understand that for Tmall, actually they need a separate app. But we have to make sure that this separate app should give people a different shopping experience and shopping journey. So that's why we are working very actively on the development of our new Tmall app, and we will promote this app when it is ready.

Carlos, on your second question. When a user has a mobile device, the user tends to use it more frequently. So number one, the frequency of purchases go up because mobile is just so convenient. And anytime, anywhere you are, when you think about buying something, especially in sort of impulse items, it's just very easy to get on the mobile and buy something. The second thing on user experience is that because of mobile, the collection of data can be more customized, for example, location-based data. That could help us target the users better. And on the seller end, we have recently launched a tool integrated into our mobile Taobao app that enables the sellers to manage the entire storefront through mobile. So they don't even need to own a PC or a notebook computer to manage their storefront. So we would -- we made it very, very easy for them to manage their storefront. So we're doing all these things to make it easy for both buyers and sellers to transact on the mobile platform.

The next question comes from the line of Alex Yao from JPMorgan. Alex Yao - JP Morgan Chase & Co, Research Division: So I have a follow-up question on Daniel's comments on the PC monetization. You discussed the CPC and CTR, the click-through rate in this quarter still declined on year-over-year basis. I'm wondering can you share with us the trend of these 2 metrics since you introduced the mechanism to change the algorithm and encourage the long-tail bidding. And then the path of -- for these 2 metrics to recover and increase on year-over-year basis, should we think about this as a few months' story or a few quarters or a few years? The second question is about the Taobao versus Tmall. So this quarter, the growth rate is very, very different. I think you also mentioned one of the reason is because Tmall had done some events to drive the GMV. Should we think after the management change, the China retail marketplace, you guys are increasingly prioritize Tmall a bit more than Taobao? I'll stop here.

Okay, for the first question, let me explain again, actually on PC, because more and more merchants they observe that traffic are shifting to mobile, so they start to spend money on mobile and better keywords. So that's why the CPC, cost-per-click, reduced on PC side because of lack of competition. And I tried to correct that. Actually on the PC side, it's not a CTR reduction. It's about because of the traffic shifting, part of the traffic shifting to the mobile side. So actually, the search traffic actually is going flat. So that, we believe, is the reason why we saw a decrease in the marketing revenue on the PC side. And for the second question about the growth of GMV in Tmall versus Taobao. And actually, we don't try to prioritize Tmall or prioritize Taobao. They are equally important to us. For this quarter, actually, why we have 2 promotions for Tmall, one is in Chinese New Year. Because in Tmall, we have partnered with a logistics company, which can help us to deliver the large appliances all across China, even in Chinese New Year. So we encouraged our seller on our platform who sells -- who are selling large appliances and they do the promotion during Chinese New Year. And the second one is the promoting in March. Actually, in March 8, we launched a promotion and which is encouraged consumers to scan the barcode and purchase. The vast majority of the items selected in this promotion is groceries from Tmall, so that's why Tmall enjoyed the benefit in this quarter from the promotion.

Yes, Alex, just to add a little bit to Daniel's. In terms of -- we're talking about PC, the traffic CPC. To us, we really see this PC mobile as one integrated marketplace rather than 2 businesses. Think about how many -- it's about user, right? People, they're surfing PC screen to put the products in their shopping carts and they confirm orders on mobile, that's just become very common. So these 2, I mean, channel to us, they are really serving [indiscernible] of consumers in one marketplace. So for us, overall GMV growth, overall revenue growth, that's what represents the business world, rather than just separately seeing each PC and mobile business.

The next question comes from the line of Scott Devitt from Stifel. Scott W. Devitt - Stifel, Nicolaus & Company, Incorporated, Research Division: One question. It relates to long-term take rates. As I think about your business historically, merchants have been willing to pay a certain percentage for the access to customers and an ability to actually conduct commerce on the site, and that rate on the desktop historically has been higher than on mobile. And just trying to understand as mobile matures over the long term, is there any reason to think that mobile monetization or take rate shouldn't converge with where the historical desktop take rate has been? Or is there something that's done by merchants in terms of advertising spend that's not tied directly to the transaction that would lead that line of thinking to be inaccurate?

Yes, so in terms of the mobile take rate, I think we remain bullish on mobile monetization in the longer term. We do believe that mobile take rate should approach PC or even higher than PC. The reasons are very simple, 3 things. We see more customers -- we see more consumers from mobile. This you can already tell from MAU growth. So more buyers. And second one is higher engagement. So people comes through the mobile more often, more frequent than they did on PC. And the third one is higher value. That's because we have more data on mobile, the location-based data and buyer behavior data. So that's the reason made us believe that the value generated through the mobile platform could be very significant and could be higher. And eventually, that will drive the mobile monetization, the take rate.

The next question comes from the line of Dick Wei from Crédit Suisse. Dick Wei - Crédit Suisse AG, Research Division: And congrats to Daniel on his new role and good quarter as well. Two questions. The first question is on maybe the Tmall GMV growth. Maybe if I look out for next couple of quarters, I understand there's some new kind of merchant’s recruitment policies and other customer-related user experience policies implemented. When should we expect the Tmall growth to kind of continue accelerating going into the next couple of quarters? And second question is on the -- more on the O2O and some of the local services initiatives. I wonder if management can discuss more about the -- some of the investment plans and some of the other cooperation with the end-financial side, that will be great.

Okay. Thank you, Dick. For the first question and -- we adopt, we adjust our recruitment policy in Tmall in early March, and we hired an entry -- we upgraded our entry standards. So the purpose of this is to increase the quality of the merchants. So for when we look at the Tmall operating methodology, we don't try to grow our business by number of merchants. Instead, we try to help our merchants to grow their business to help them to increase their sales -- to enjoy high sales store growth, same-store growth. So we believe that by adopting this new policy and the people will enjoy a better experience because we give them more confidence in the high-quality products. And all the merchants here are high quality, so we believe, ultimately, this should be a benefit for all the merchants here and also benefit for the long-term growth of Tmall. And for the second question, O2O. I would like to say that O2O to me is actually isn't a -- O2O cannot be a unified platform. It's very difficult to be a unified O2O platform because in each business, there is a O2O opportunity. And the online-to-offline business in certain business should be fully integrated. So our strategy is to identify and focus on some of the key areas, key industries and to restructure the business using the Internet -- use the Internet technology and thinking. For example, in the food and catering, in the car booking, and we participate in the travel sector. We, either we do this business by ourselves or we enter this sector by investment.

The next question comes from the line of Thomas Chong from Citigroup.

I have 2 questions. The first question is about the cross-border e-commerce strategy. Can management provide us some color about the GMV potential in the next couple of years? And what's the expectation from an Alibaba perspective in terms of serving 2 billion consumers in the next few years' time? And secondly is about the M&A strategy. Can management talk about what's your overseas strategy in e-commerce?

For the cross-border business, and this is one of our priorities in the next year. And we have huge demand from Chinese consumer for high-quality foreign products. So this is also, we believe, the starting point of our globalization. So we will start with the import business and to bring more and more high-quality foreign brands, retailers and their products to China market. And today, we are in early stage, and we believe that we will have a -- the consumer will -- actually they welcome this high-quality product and we will enjoy a rapid growth in this sector.

Yes, in terms of the GMV, I still remember like 2 years ago when we were asked about GMV growth, we were at around USD 250 billion GMV. And we said that in the next 2 to 3 years' time, we see that number get doubled. Right now, you can tell that we're well on track towards that target. And going forward, we do believe that there is market for more than USD 1 trillion GMV worldwide.

Yes, I just want to comment on the -- there's a question on the M&A strategy in -- especially overseas, I just wanted to comment on that. We have -- we're looking at M&A sort of outside of China in 2 types of situations. The first one is we're always looking to invest in minority stakes in companies that we see as having disruptive technology or business ideas. And there, the main purpose is to back entrepreneurs and establish the relationship and learn from these entrepreneurs. So that is one type of category. The other, when we venture out to -- out of China to do something, it is usually with a view toward improving the customer experience that tie back to our core business. So for example, we made an investment in Singapore Post because we are looking at cross-border logistics, making sure that sellers that selling from China to all over the world, especially to Southeast Asia consumers, can have a better experience when it comes to logistics, okay.

The last question comes from the line of Cynthia Meng from Jefferies.

My question, first of all, is a housekeeping one. For the SBC to sales ratio, could Maggie give some more color on the trend of this ratio and whether we will see a step-down at some point? Secondly is, any update on Alipay? We're interested to know the percentage of Alipay's payment that came from Alibaba China commerce retail marketplace, if management could give us some more color there.

Yes, talking about SBC, we stated in the announcement that there are 2 parts included in this SBC. One part is our normal performance on higher grant. The other part is purely, according to the GAAP, we have got to mark certain SBCs mark-to-market. This part relates to the shares award of Ant's Group granted to our employees and the shares AGH grants to Ant's employees. So going forward, I think it's hard to say, because the mark-to-market relates to the valuation of both groups. But what I can share is that this significant part of expenses is noncash and it's not going to dilute any of our share -- shareholdings. And we believe that the dilution of -- coming from this SBC will be still, stay at around 1% going forward. Second question, sorry, I missed the second question.

Is update on Alipay and the percentage of Alipay payments that was contributed from Alibaba's China commerce retail marketplace.

Yes, right, right. Alipay, as you mentioned -- how many percentage, we disclosed in the prospectus that around 78% of our total transaction get paid through Alipay. And in the coming 20-F, we're going to give another update. There's no significant change over that ratio.

Unfortunately, we have not enough time for any further questions. Ladies and gentlemen, this concludes the presentation for today. Thank you for participating. You may all disconnect.