Good day, ladies and gentlemen. Thank you for standing by. Welcome to Alibaba Group's September quarter 2021 results conference call. At this time, all participants are in listen-only mode. After management's prepared remarks, there will be a question and answer session. I would now like to turn the call over to Rob Lin, Head of Investor Relations of Alibaba Group. Please go ahead.
Good day, everyone, and welcome to Alibaba Group's September quarter 2021 results conference call. With us today are Daniel Zhang, Chairman and CEO, Joe Tsai, Executive Vice Chairman, Maggie Wu, Chief Financial Officer. This call is also being webcast from the IR section of our corporate website. A replay of the call will be available on our website later today. Now, let me quickly go over the safe harbor. Today's discussion may contain forward-looking statements. Forward-looking statements involve inherent risks and uncertainties that may cause actual results to differ materially from our current expectations. For detailed discussion of these risks and uncertainties, please refer to our latest annual report on Form 20-F and other documents filed with the U.S. SEC or announced on the website of Hong Kong Stock Exchange.
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 adjusted EBITDA, adjusted EBITDA margin, adjusted EBITDA, adjusted EBITDA margin, commerce adjusted EBITDA before strategic investments, non-GAAP net income, non-GAAP diluted earnings per share or ADS, and free cash flow are expressed on a non-GAAP basis. Our GAAP results and reconciliation of GAAP to non-GAAP measure can be found on our earnings press release. Unless otherwise stated, growth rates of all stated metrics mentioned during the call refers to year-over-year growth versus the same quarter last year. In addition, during today's call, management will give their prepared remarks in English.
A third party translator will provide simultaneous translation in Chinese on another conference line. Please refer to our press release for details. During the Q&A session, we will take questions in both English and Chinese, and a third party translator will provide consecutive translation. All translations are for convenience purpose only. In the case of any discrepancies, management statements in the original language will prevail. With that, I will now turn the call over to Daniel.
Thank you, Rob. Hello, everyone. Thanks for joining our earnings call today. In the past quarter, Alibaba continued to firmly invest into our three strategic pillars of domestic consumption, globalization, cloud computing, and data intelligence. We believe this will establish solid foundations of our long-term goal of sustainable growth in the future. Some context on the China macro environment before I share our business updates. In the September quarter, China's GDP and consumption continued to grow, but slower than the previous quarters. Overall retail sales for the quarter increased 5% year-over-year. Online retail of physical goods rose 8% year-over-year compared to the 19% during the same period last year. Offline retail has only just returned to the same level as two years ago. These economic headwinds, coupled by intensifying market competition, also affected our core commerce business in China.
In line with industry retail trends in China, physical goods GMV year-over-year growth rate moderated to single-digit this quarter, mainly due to a slowdown in apparel and the general merchandise categories. That said, growth rates of consumer electronics and home furnishing categories remain resilient. In the challenging macro environment, we continue to invest in user acquisition and have seen promising progress in low-tier cities, which I will elaborate on later. Our global annual active consumers reached approximately 1.24 billion, which is a net increase of 62 million quarter-over-quarter and a 20% growth year-over-year this past quarter. Our AAC grew to 953 million in China and 285 million overseas.
We are on track to deliver the one billion China AAC target by the end of this fiscal year, and we remain firmly committed to achieving our long-term target to serve two billion consumers globally. Let me turn to our long-term investment strategies. In less developed areas across China, Taobao Deals has continued incremental growth to our overall user base and stimulate more user activity and engagement in our China consumer ecosystem. Taobao Deals AAC surpassed 214 million this past quarter. Close to half of Taobao Deals daily active users are unique incremental users in addition to Taobao app DAUs. Consumers are attracted by the value for money products and differentiated user experiences offered by Taobao Deals. at the same time, manufacturers take advantage of its one-stop full-service solution that includes online store operation and fulfillment to sell directly to end customers.
We call this solution M to C or manufacturers to consumers. During this past quarter, Taobao Deals M to C orders grow nearly 400% year-over-year. For our community marketplaces business, Taocaicai, we continue to focus on investing in and building a new digitalized community commerce model that is sustainable and healthy. Taocaicai has expanded operations to close to 100 cities, and its GMV growth surpassed 150% quarter-over-quarter. We are deliberate in our approach and faithful to our belief in true value creation, rather than blind pursuit of unqualified and unsustainable growth. We are instead focused on leveraging core capabilities that Alibaba has built over years in the supply chain, logistics, user engagement, and channel development. We aim to grow a new digitalized social commerce infrastructure that offer consumers quality services and products with highly competitive price.
Consumer survey results have shown that product quality is the top deciding factor for consumers to choose Taocaicai over other platforms. Taocaicai has contributed to increasing the purchase frequency of our core commerce consumers. More than 50% of Taocaicai users were first-time buyers of fresh produce on our China retail marketplaces. We believe the ultimate value proposition of the community commerce infrastructure is in our ability to elevate the quality of routine everyday services in local communities. It ranges from guaranteeing supplies during pandemic lockdowns, supporting local farmers to sell high quality produce, vocational training, and job creation. We will continue to enhance these services to create value for our communities. In local services, we are creating a product and service metrics centering around synergies between Ele.me, Amap, and Fliggy.
Ele.me and Amap are positioned as our two main user entry points for homebound and destination bound local services respectively. Ele.me delivered 29% growth in AACs and 30% growth in order volume year-over-year, with non-meal delivery order growth outpacing total order growth this past quarter. In addition to map navigation services, Amap has been expanding into service offerings around the user's journeys and the destinations such as route heading, hotel bookings, et cetera. During the quarter, transacting users of these destination services on Amap increased more than 200% year-over-year. Although the recent resurgence of COVID-19 in parts of China impacted stability in the supply of hotel rooms and travel products in many provinces, we see the positive contribution in user value from adding Fliggy product supply to Amap and our other user platforms.
We just celebrated our 13th November 11 Global Shopping Festival with a record GMV of RMB 54.03 billion, excluding unpaid orders, representing a year-over-year growth rate of 8.5% for the 11-day campaign. The stable and healthy growth of the high base over last year reflects China's consumption power and economic resilience. Looking forward, we remain confident in development of China consumption. Today, we already have the largest and the most valuable consumer base in China with 953 million AACs, which are still growing. At the same time, we will serve our large and diverse consumer population through a user segmentation, addressing different needs and use cases through an assortment of apps with differentiated value propositions. Further, through cross-selling of products and services, we will increase our user stickiness, wallet share, and overall retail penetration.
Outside of China, we continue healthy expansion of our user base and revenues, achieving 285 million AACs and a 33% revenue growth during the quarter. In Southeast Asia, Lazada produced 82% order growth year-over-year during the quarter, with triple-digit growth in Thailand, Vietnam, and Malaysia. Trendyol, the largest e-commerce platform in Turkey, delivered GMV growth of over 80% year-over-year. AliExpress GMV growth decelerated this quarter due to the negative impact of new VAT rules in Europe and the gradual recovery of the local supply chain and consumption in its destination markets. Looking ahead, AliExpress will further invest in expanding local operations in its strategic markets in Europe. For our logistics business, Cainiao Post has achieved coverage in over 200 cities as of the end of September.
They have become our stations for consumer services in more than 100 counties and towns across less developed areas. The daily average package volume delivered through Cainiao Post increased nearly 70% year-over-year to 69 million during the quarter. In the domestic supply chain business, Cainiao's fulfillment volume for Taobao Deals M2C business increased by more than 200% year-over-year. As part of its global logistics network expansion, Cainiao launched new initiatives to improve the user experience for international consumers by introducing self pick-up lockers in Russia, Spain, France, and Poland, while continuing to enhance its cross-border end-to-end logistics capabilities. Last but not least, Alibaba Cloud delivered revenue growth of 33% year-over-year this past quarter, driven by strong revenue growth from customers in the internet, financial services, and retail sectors.
In October, we held our 13th Apsara Conference, which is now the biggest technology conference in China by attendees. We unveiled several new proprietary product and technologies upgrades, including Yitian 710 server chip, the X-Dragon architecture, Panjiu Cloud Native Server series, Alibaba AI and big data platform, and a new generation of PolarDB database. These show that Alibaba Cloud is benchmarking against the world's top cloud computing technologies and a milestone in its proprietary product capabilities in IaaS and PaaS. In September, we announced 10 initiatives and pledged to invest RMB 100 billion by 2025 to advanced scientific and technological innovation, economic development, high quality employment, and vulnerable group support in China. We believe these four areas are among the common focus of all responsible companies in the world under the ESG framework.
We will incorporate these 10 initiatives into the social responsibility pillar of our ESG strategy and hope that our digital commerce and technology ecosystem can contribute our part in these areas. Looking ahead, we will continue to invest heavily into our three growth engines of domestic consumption, globalization, cloud computing, and data intelligence, as we announced at the beginning of our fiscal year. In core commerce, we have started to see encouraging initial results of our investment in low-tier cities, local services, and logistics in the form of user growth and enhanced logistics capabilities. Our investment in globalization has also delivered progress in user base, consumption, and revenue growth. In cloud computing and data intelligence, we will strengthen our market leadership by further enhancing our core product and technology capability.
No matter the challenges in the current macroeconomic environment, and with more and more players entering into the industry, we remain very confident in our business strategy and our future. We will continue to focus on capacity building, value creation, and a multi-engine approach to growth. We firmly believe our strategy and perseverance will bring mid and long-term returns to our customers and investors. Now, I would like to turn it over to Maggie, who will walk you through the details of our financial results.
Thank you, Daniel. Let me share some high-level thoughts on our financial results first. Our revenue growth continued to be strong and our revenue are becoming more diversified. Overall, we grew revenue by 29% year-over-year to RMB 200 billion. Revenue of our international commerce business and cloud computing exhibited robust growth of 34% and 33% respectively. Our adjusted EBITDA was RMB 28 billion, but our core profitability before investments in key strategic areas remain very significant and stable at about RMB 52 billion. I'll talk about our investment areas later. The decline of RMB 13.2 billion year-over-year in total adjusted EBITDA is a result of our investment in strategic areas and merchant support. We have one of the most diversified and loyal customer base in China, and then we believe this investment will further strengthen our position.
Our overseas investment will also help us gain mindshare in many international markets in the future. Here we provide a revenue breakdown by segment, where you can see that Alibaba has evolved into a multi-engine growth company with businesses across different runways, and our growth and revenue continue to be more and more diversified. Cost trends. Now let's look at our overall cost trends, excluding SBC, as a percentage of revenue. Cost of revenue ratio increased in September quarter due to higher proportion of our direct sales business, mainly from the consolidation of Sun Art. This direct sales business will continue to strengthen our retail initiatives, especially in the development of our product sourcing capabilities.
For example, our community marketplace business continued to grow rapidly, which is partly thanks to the strong procurement and supply chain capability in perishables, FMCG, and general merchandise categories of Sun Art. Sales and marketing ratio also increased in September quarter due to an increase in marketing and promotional spending for user acquisition and engagement for our mobile commerce businesses such as Taobao Deals, Lazada, Hema, and also Taocaicai. G&A expense remained stable at 4% compared to same quarter last year. Now let's look at our profitability in the area of investment. Commerce adjusted EBITDA before key strategic investments was largely flat at RMB 52 billion, primarily reflected our support to merchants as well as the increased spending in user acquisition engagement on our marketplaces.
If excluding our merchant support program spending, the growth of commerce adjusted EBITDA before key strategic investment was similar to that of our CMR revenue growth, suggesting a relatively stable EBITDA margin of our China retail marketplace. Adjusted EBITDA decreased by RMB 13.2 billion. The decline primarily reflects RMB 12.6 billion year-over-year increase in combined losses of key strategic areas such as Taobao Deals, local consumer service, community marketplaces, and Lazada within commerce. Let's take a closer look at the business progress, revenue, and profitability of our business segments during the quarter. First, on our commerce segment. Revenue from our commerce segment in quarter was RMB 171 billion, 31% year-over-year growth. Revenue of China commerce business showing 14% year-over-year growth, excluding Sun Art consolidation. CMR is growing 3%.
There are two key reasons for the slower growth of CMR. First, our CMR growth were primarily tied to single-digit physical goods GMV growth that resulted from slowing market conditions and more players entered into this sector of the China e-commerce market. China's NBS statistics have shown us a slowdown of overall consumption. We experienced a larger impact given our position as the largest e-commerce player in China. Secondly, CMR growth was lower than physical goods GMV growth, primarily due to the incremental year-on-year increase in merchant support and subsidies. Revenue of international commerce grew 34% year-over-year, with continuous strength of both international wholesale and international retail businesses such as Lazada, alibaba.com, AliExpress, and Trendyol. Commerce adjusted EBITDA decreased by 12.7%. The decrease reflects RMB 12.7 billion.
The decrease reflected increased investment in those strategic initiatives. Now, these initiatives we invested within commerce. As noted, we're investing in growth business that strengthen consumer experience, enhance loyalty, penetrate into a less developed area in China, and further extend our presence internationally. During the quarter, the businesses all show robust growth. Taobao Deals and Taocaicai continue to penetrate into less developed markets of China and they extend our addressable market. Taobao Deals achieved 240 million AAC, up 49 million. Taocaicai grew GMV by over 150% QoQ. As a reminder, our community marketplace business started early this year. Ele.me continues to deliver strong order growth of 30% year-over-year, and it's one of the main consumer gateways for our local services business with high frequency purchasing intent.
Lazada and Trendyol continue to generate robust growth in new international markets. Lazada order grew 82% year-over-year. Trendyol GMV grew over 80% year-over-year. Let's take a look at the cloud computing business. Alibaba Cloud's revenue grew 33% year-over-year to RMB 20 billion during this quarter, which re-accelerated compared to the June quarter growth. We saw strong revenue growth from customers in internet, financial services, and retail industries. Alibaba Cloud generated an adjusted EBITDA of RMB 396 million, given strong revenue growth and economic scale. Next, our DME business during the quarter was RMB 8 billion in revenue. If you look at the losses, it slightly increased year-over-year because the investment in content, et cetera. Overall, it continued to narrow in losses in the first half of the fiscal year.
Income statement selective financial metrics. Let's review some of these, line items. Interest and investment income was a loss of RMB 11 billion in September quarter, primarily due to net losses arising from changes in market prices of our equity investments in publicly traded companies in the quarter. This is compared to net gains in the same quarter of 2020. Income tax expense in the quarter were RMB 6.1 billion, compared to RMB 1.9 billion the same quarter of last year. In the same quarter of last year, tax expenses reduced by approximately RMB 6 billion because during that quarter, certain subsidiaries were officially notified that they were approved of key software enterprise status for calendar 2019, which entitled them to a reduced tax rate of 10%.
Share of results of equity method investees was 5.5 billion during the quarter. Here we show a GAAP and non-GAAP net income attributable to shareholders. Besides the reasons we discussed above, the year-over-year decrease was also due to losses arising from the changes in market prices of our equity investment in publicly traded companies. September quarter free cash flow. We continue to have a strong net cash position. As of the end of the quarter, our cash equivalents and short-term investments were RMB 443 billion , which is approximately $69 billion. Free cash flow was RMB 22 billion . The decline was driven by a decrease in the profits. Before we go into Q&A, I would like to provide some perspective on our financial outlook.
Over the last six months, we have observed softer market conditions with slowing consumption growth in China. Given slower than expected domestic consumption growth since we provided our revenue guidance in May, we now expect our fiscal year 2022 revenue growth to be 20%-23% year-over-year. The adjustment primarily reflects lowering of commerce revenues that include both direct sales and the customer management revenue. Let me share with you a bit more on our investment and profitability. Firstly, in China, we're seeing more players entering into the e-commerce industry. Our peers are increasing investments to acquire users, and most of them continue to show a high level of spending.
We will continue to invest in our e-commerce business that create value for consumer and merchants and keep our market leadership position, and then for the competitive strength in the longer term. Secondly, we believe our local service business still have ample long term potential. These businesses have generated strong transaction growth and high user retention rate, setting a strong foundation to compete for the long term. We're seeing robust GMV and user growth in our international commerce business. These businesses, Lazada, Trendyol, AliExpress, are exhibiting robust growth driven by localization strategy as well as our ongoing investment in building technology and logistics capabilities. Lastly, we continue to expect exciting growth opportunities for our cloud business that will benefit from digitization in the industry, industrial internet era.
Given our significant profit generation and a strong balance sheet, we believe it is important to grow and expand into new addressable markets for the long term despite near-term weakness in domestic macro environment. As such, we will continuously invest into the above-mentioned areas, and we'll report to you the business development progress down the road. We believe this business will continue to increase consumer mind share and wallet share that will be important to our long-term growth and value. Lastly, before we go to Q&A, we'd like to inform you that we will be hosting an Investor Day on December 16th and 17th. During the event, our senior management team will provide you an update on Alibaba's key businesses and our vision for the future.
Over the last several quarters, investors and analysts have communicated their desire to understand better on how we measure the success of our growth businesses mentioned, and that there, these businesses long-term prospects. This Investor Day will be an opportunity to provide you with more details and insights. Now let's open the floor for Q&A. Thank you.
Thank you.
Hi, everyone.
Thank you.
For today's call, you are welcome to ask question in Chinese or English. A third-party translator will provide consecutive interpretation for the Q&A session. Our management will address your question in the language asked. Please know that the translation is for convenience purpose only. In the case of any discrepancy, our management statement in the original language will prevail. Operator, please connect speaker and SI conference line now, and then start the Q&A session when ready. Thank you.
Thank you. As a reminder, to ask a question, you will need to press star and the number one on your telephone. To withdraw your question, please press the pound or hash key. Please stand by while we compile the Q&A roster. To give more people the opportunity to ask questions, please keep yourselves to no more than one question at a time. Once again, please press star one for your questions. Our first question is from the line of Thomas Chong of Jefferies. Your line is open. Please go ahead.
Yeah, good evening. Thanks management for taking my questions. I have a question regarding our new initiatives. Given that Taocaicai Taobao Deals the results are doing very good, and we are seeing Taobao Deals the AAC already surpassing 240 million. Just want to get a sense about regarding our new initiative, when should we expect the monetization to ramp up? On the other hand, over the long run, how should we think about the revenue scale of these new initiatives versus our existing business? Then I have a second question regarding connectivity. Given that, it has been quite a while after we have been cooperating with our peers on connectivity, just want to get a sense about any latest progress or the monetization potential that can be shared. Thank you.
Okay, let me answer the questions one by one. For the first one, I think today our priority for Taobao Deals and Taocaicai is still to build the right, I mean, infrastructure in terms of the manufacturers to consumers model in Taobao Deals, as well as a hyperlocal community marketplace infrastructure. I think these are our priorities. In terms of user engagement, we see very strong user engagement in the past quarters. As you can see, the AAC for Taobao Deals reached 240 million.
For Taocaicai, it's because this is a more like additional services on Taobao mobile app and Taobao Deals, which also show a very good, I mean, user conversion to the fresh produce and the food categories. We are very confident that if we can provide value to the consumers as well as the manufacturers and the suppliers of the from the farmers, and we believe that we can find a very we can generate also the value to the platforms as well.
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Look ahead, I think for the value creation model, I would say it's not only like a marketplace to monetize the traffic in the marketplace, but also we can see a strong potential as a result of the supply chain optimization for the manufacturer to the consumer business as well as the farm to table business.
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Yeah, for your second question, connectivity. As we always said, connectivity and openness are the core value of internet. We strongly believe that will be a win-win situation if all platform companies can embrace openness and connectivity in substance not in form. I think for us we will continue to promote the non-discriminatory user sharing and consistent across platform to make sure our consumers have the consistent user experience. Because today if you are Taobao users you may have the experience that when you want to share some product links with your friends in social platforms the experience is actually bad. I think this is for our mutual customers benefit to improve their experience in the when they try to do whatever they want across ecosystems. We have actually already made necessary preparations for the future interconnectivity.
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Thank you.
Operator, next question.
Thank you. The next question is from the line of Alex Yao of JP Morgan. Please go ahead.
Good evening management and thank you for taking my question. During your prepared remarks you guys mentioned that the weak revenue momentum was due to both macro and the competition. Based on the e-commerce results tonight, you guys looks like underperforming the industry peers in this quarter. Can you help us understand to what extent is the revenue weakness due to macro and to what extent it is due to competition? For competition what are the areas you see the most pressure and the challenge and what are the strategies to regain competitiveness in those areas? Thank you.
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Well, if you look at the landscape actually today for e-commerce, the definition of e-commerce actually is evolving. Today in the market there are multi format of e-commerce model. As long as you have some traffic and you have user with you and based on the public available third party payment solution and the logistic and delivery fast delivery express deliveries anybody can try something on e-commerce. We strongly believe that our for Taobao, our advantage is that consumer mindset and we are a purely a consumption destination for all the customers. We will continue to develop multi features and applications in our Taobao app as at the same time to segment our user group by different mobile apps for specific value propositions.
Today if you look at the market, I will say for all the players actually they may address the customers needs from one angle. Actually for Taobao, we are the only destination who can meet the customers purpose from different to meet the customers different purposes. For someone who have very specific shopping purposes they can Taobao to them is positioned as a mobile as a shopping search. Also Taobao has a lot of applications to facilitate people to enjoy the fun of discovery. Over the years we've built our live streaming business as well as the short video business and the social contents business. We are a platform with multi formats, I mean consumer journeys for people with different purposes. I think we will continue to invest in this and to give people most comprehensive selections and the most efficient and guaranteed consumer experiences.
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As to your question about the slower GMV growth reasons, how much is caused by macro conditions, how much from competition? Actually, it's very difficult to quantify the impacts, I would say. That's why we believe that these two reasons are all the factors we should consider. Actually, we are the market leader in the retail commerce. That's why I think our performance to some extent will reflect the overall market, I mean, condition.
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Operator, next question.
Thank you. Next question is from the line of Piyush Mubayi of Goldman Sachs. Please go ahead.
Thank you for taking my question. Just looking ahead, your guidance seems to suggest you'll grow between 11%-16% in the second half of 2022, and that's a step down from the pace of growth you had in the first half. If we accept that pace as being the continuation of where we are today. What are you seeing that gives you the conviction that this slow pace will be maintained through the second half of fiscal year 2022 ? And I wonder if you could look beyond that and give us what you think is a normalized pace of growth, for your business and for China GMV in general. Really focusing on growth here, if you don't mind.
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Hi, Piyush. This is Maggie. Let me try to answer your question. Yes, if you look at our guidance and then try to derive the second half growth for our revenue, it indicates revenue growth is at the teens. That assumption is mainly based on the GMV growth expectation, and the impact on the revenue growth is mainly placed in the core commerce and China retail commerce. We do think if you look at the total China GDP and consumption as it this quarter compared to previous quarter, it comes down significantly to single digit. We see this may continue for the following quarters.
We, as the biggest player right now in size, account for, you know, we have approximately RMB 8 trillion GMV versus 44-45 of the total national GMV. The impact will be largely on us. If you look forward beyond this year and in the following years, how we see our revenue growth, I think first of all, our revenue growth engine now is already beyond the China consumption, beyond the CMR. CMR, if you look at this quarter, it accounts for around 36% of total revenue, where it used to be over 50% several quarters ago.
This is because, you know, all of these cloud computing and international businesses, China local service, they all start contributing and increases contribution to our total revenue. This is where we talk about multi-engine growth and continue to expect to see growth in these areas. At the same time, within core commerce, Daniel talked about our multi-app strategy and talks about, if we look in the midterm long term, we don't believe the monetization can purely coming from these, you know, traffic and GMV growth, but more from this infrastructure capability we're building and to enable merchants. We don't have exact monetization plan to communicate at this stage. We'll share more later on during Investor Day.
We are also gonna share with you how we measure the value creation. Eventually this is always our theme that once you know merchants stay, consumers stay and the retention rate is here, and they enjoy the service, we'll find out ways to monetize. If you look at the investment we are making nowadays, we actually this is our decision to invest and to move towards our target. First target is the user base of over one billion in China. I think in that aspect, we're pretty much on track. The multi app strategy makes the engagement of these users being enhanced. The merchant side, we have a lot going on in terms of merchant service provision, which we'll also share next month. The value creation and then eventually we believe the return will be there. Thank you.
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Operator, next question.
Thank you. Our next question is from the line of Alicia Yap of Citigroup. Please go ahead.
Hi. Good evening, management. Thanks for taking my questions. I have a question related to CMR and GMV. The slowdown of the CMR, is it more temporary and also a function of GMV? Has CMR actually experienced slower growth than GMV in the past couple quarters, given you know we have been providing many services to support merchants this year, especially given it's a tough macro. If GMV re-accelerate later, could CMR re-accelerate even faster? Since you know we have been still under monetized and you know the way that we can further create value for merchants, we can still add on you know to the entire value chain for the merchants. Any colors that you could help us on that would be great.
In what ways could GMV re-accelerate when the macro recovers? Is there any ways that we are preparing to help us capture when the macro recovers? We can actually further boost our GMV, you know, faster than the macro recovers. Thank you.
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Thank you, Alicia. Yes, you're right. The CMR growth actually, to some extent, is tied to the G&A growth. In the past several quarters, we've seen that CMR growth is slower than the growth of GMV, which is mainly due to our merchant support program.
If we add back those merchant support spending, then the CMR growth would have been pretty much in line with the GMV growth. Eventually, if China consumption growth recovered and GMV growth comes back and gets accelerated, we believe that CMR growth will also be consistent with the growth of GMV. In our view, when we look at the future revenue component, we believe that all of these efforts we have been making, you know, not only the user base expansion, but also these services, look at live streaming, all of these, you know, secondhand and luxury products and a lot of supplies and also user experience building exercise will bring value to consumers. We should have new revenue streams coming into the total group revenue pie. These will be the additions to our, you know, future revenue growth.
Yeah, maybe let me add a few words on-
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Yeah, let me add a few words on the question. Actually, we are always make ourselves ready for any new market opportunities. Even more, we are always trying to do something, do anything we can to create new market opportunities. I think today, if you look at the landscape, the e-commerce actually account for like 20%-25% of the total retail. If you look at the penetration rate by categories, actually it varies. I think it's still a big room to first digitalize the existing, I mean, total retail. Furthermore, is to create a new demand by leveraging the power of technology to improve the efficiency of the supply and demand, and also digitalize the retail formats, no matter it's online or offline or integrated, to give people superior experiences to unlock the potential of consumption.
We will always try to innovate and incubate new models and to capture these new opportunities and even create new opportunities. Thank you.
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Operator, next question.
Thank you. The next question is from the line of Yang Bai of CICC. Please go ahead.
On behalf of Bai Yang from CICC, thanks for taking our questions. We have two questions. Our first question is regarding to the live streaming business. What's our current strategy in live streaming business? As we know that more traffic and GMV are concentrating to the top KOLs in Taobao. How should we think this trend going forward? Are we going to balance the support and the traffic between the top two and the long tail KOLs? Any color would be very helpful. The second question is regarding to the Personal Information Protection Law impact. Are we seeing any significant impact to our CMR business? How should this change in the future? Thank you.
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For your first question, for live streaming, actually, for our Taobao live streaming today is a very important, I mean, application in our mobile Taobao. We observe that for a lot of fans and customers, they love it in this live streaming format. But we don't view this live streaming as an independent application, but part of the seller application to enable seller to engage with the customers through themselves, through their own stores or through the KOLs.
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Yeah, if you look at the ecosystem in live streaming business, actually we do have some top players, they got a very good popularity among their fans. But at the same time, we have many KOLs, else, second tier, third tier and many new KOLs. The very unique, I mean situation in Taobao mobile app, in Taobao live streaming is the store live streaming, which initiated by the store operator, by the sellers, even by the staff and associate in a seller. So I think we provide a very dynamic, I mean, ecosystem in this Taobao live streaming.
As a platform operator, we don't intend to so-called balance the traffic. Actually we never do anything to balance the traffic or rebalance the traffic. I think we should keep the market open to the customers, and it's their option to select which one to follow and which one they in favor of. For us, we always try to help and incubate more and more diversified KOLs and diversified, I mean young staff in the sellers to become a new generation stars.
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As to your second question for the newly effective PIPL, actually we did very necessary preparation for the law which took effect on November 1st. Based on our preliminary assessment, we don't expect PIPL will have a material impact on our business. Because this is still a very short time frame, we still need more time to assess. So far so good. Thank you.
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Thank you. Next question is from the line of Gary Yu of Morgan Stanley. Please go ahead.
Hi. Thank you management for the opportunity to ask questions. I have two questions. First one is on some of the kind of new growth business that you highlighted at the press release including both the international business and also the cloud computing business. How should we look at the growth outlook in the future? What kind of competitiveness are we seeing in overseas market? Particularly on cloud, is the kind of headwind from major customer loss already behind, and therefore we should continue to see acceleration in growth going forward. My second question is related to strategic investment. How should we look at the level of investment going into fiscal year 2023? Given we have already achieved some you know early success, should we expect continue to step up investment in Taobao Deals and marketplace.com community marketplace going into fiscal year 2023? Thank you.
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Thank you. For the first question today as we said we are taking a multi-engine growth approach to grow our business. Today you see that both Cloud and international business show a very robust growth. The Cloud revenue this quarter resumed their growth to 33% year-on-year. For international business international wholesale and retail business as a whole reached a year-on-year growth rate of 34%. I think for both business today both of them are in early stage of development, early stage of growth. We still try to do the right thing to build the right infrastructure to make sure we capture the long-term opportunities to maintain a sustainable growth.
For example, like for Cloud today we enhance our investment in technologies and products. As I shared in my script we announced a couple of very important technology and product upgrades in our operational conference this September. This is a reflection of our continuous efforts in Cloud relevant technologies and products. Going forward, we will continue to do so, and we believe that for Cloud, opportunities in China and in the world, it's not only a replacement of the existing IT infra, but instead actually because of Cloud, you get new opportunities in intelligence services.
You have got new opportunities in 5G for not only cloud but also for network and terminal and edge. We will get ourselves ready for all these new opportunities. I think this is relevant to all the industry, all the sectors, and in the economy, and not only in China but also in many other markets in the world. As to the international business, today we reported that our AAC for international market reached 285 million. I think we witnessed a very healthy growth and very rapid growth. If you look at the penetration of e-commerce in many other markets outside China, I think still in a very early stage.
We strongly believe that with our perpetual technology and experiences in this sector, we are in a good position to capture this opportunity in many other markets. As we always said, we focus on growth, but we focus on quality as well. We focus on a sustainable growth in capturing these new opportunities. Long term wise, we are very confident about this multi-engine growth strategy. Thank you.
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Right. Regarding your second question on whether we will continue to invest and to what level our investment would be in the future, I think first of all, we for sure will continue to invest while monitoring the business progress in this strategic initiative areas. When you look at where we invest nowadays is user base, right? Through our Taobao Deals, Taocaicai, et cetera, and also the services provide more services to our user base, like local service segment. There's still quite a lot of potential there. Also globalization, Lazada and Trendyol, et cetera. These areas I think will it's not a one-year investment kind of a period. It's a several years.
There might be slight adjustment in terms of the mix of the investment. For example, we expect to achieve one billion annual active consumer in the following two quarters. Then one by the time we achieve that, we're gonna focus more on the engagement and those are multi-app user growth. So, you asked about 2023. I think we will start our business tallying and budgeting session soon so that we will provide more color and guidance later on.
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Hi everyone, this is Rob. I just want to make two comments from our earnings call today. First, just want to make a slight error change in our script. We said that Double 11 GMV was RMB 54.03 billion. It was actually RMB 540.3 billion. That's the first note. The second, we are having our Investor Day on December 16 and 17. We look forward to hosting you. I'm sure there are a lot of questions you may still have, and we look forward to address all those questions on the two-day event.
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Thank you. This is the end of our call today. We'll pass back to the operator. Thank you.
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This is today's conference call and thank you for participating. You may now disconnect.