(Bloomberg) — Alibaba Group Holding Ltd. reported a 6.6% rise in revenue after its main e-commerce and cloud businesses managed only modest growth.

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Revenue for the three months ended March rose to 221.9 billion yuan ($30.7 billion), compared with analysts’ estimates for 219.8 billion yuan. Net income dived a worse-than-expected 86% after accounting for losses from publicly traded holdings. Its shares slid about 4% in pre-market trading.

Investors are closely watching results from Alibaba, a barometer of Chinese consumer sentiment, amid persistent worries about a loss of business to rivals from PDD Holdings Inc. to ByteDance Ltd. The choppy economic recovery is also roiling the company as it tries to revive growth after a years-long regulatory crackdown that kneecapped China’s private sector.

On Tuesday, the company announced a $4 billion dividend for the fiscal year. Alibaba and Tencent Holdings Ltd. both reported results on Tuesday, offering clues to whether the Hong Kong equity rally has legs. Alibaba, which owns slices of public companies including SenseTime Group Inc. and Sun Art Retail Group Ltd., didn’t disclose which specific losses hammered net income, which came in well below expectations. Its main Chinese commerce division managed just 4% revenue growth, while the cloud arm grew 3%.

Alibaba Chief Executive Officer Eddie Wu and Chairman Joe Tsai, longtime lieutenants of Jack Ma who took the helm from Daniel Zhang in September, are spearheading a turnaround of the e-commerce pioneer. They nixed major initiatives conceived under Zhang including listings logistics arm Cainiao and the $11 billion cloud unit, then decided to refocus on what they dubbed the customer experience and innovation.

Wu took the helm after a period of unprecedented turmoil at Alibaba, which contended with Covid, Beijing’s internet crackdown and then a Chinese economic downturn in rapid succession.

Ma weighed in on Alibaba’s turbulence last month, with a rare memo aimed at shoring up sagging morale among the company’s 200,000-plus employees. He emphasized that growth was returning at the company, despite its recent flip-flops, while acknowledging past mistakes.

Wu this year took direct charge of the company’s e-commerce and cloud services arm, both under pressure after a series of mis-steps and regulatory scrutiny. It’s tried to enhance customer service, beef up its product lineup and introduced features such as easy returns. On the cloud front, the once-promising division is slashing prices to regain clients from state-backed companies such as China Telecom Corp. and the likes of Huawei Technologies Co.

Away from the business, it’s hiving off non-core assets like stakes in streaming platform Bilibili and electric-vehicle maker XPeng Inc. to raise capital. It’s then funneled some of that cash into AI research and fast-growing startups like MiniMax.

(Updates with shares from the second paragraph)

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