Alibaba Joins Hands with Shinsegae: Aliexpress Releases First Korean Results Showing Decline

After the Shinsegae-Alibaba Joint Venture
Aliexpress Korea Reveals Recent Financial Results
Revenue Plunges 30 Percent, Operating Loss Exceeds 30 Billion Won
Temu and Naver Expand Aggressively... Fiercer Competition in the Open Market

Aliexpress, an international direct purchase platform operated by Alibaba Group, China's largest e-commerce company, saw its performance in the Korean market decline last year. The previously undisclosed financial results for Aliexpress's Korean operations were released for the first time after its incorporation into Shinsegae Group. The results showed that revenue fell sharply year-on-year, while profitability deteriorated, leading to a reversal into the red.

According to the Financial Supervisory Service’s electronic disclosure system on August 4, Aliexpress Korea recorded revenue of 110.4 billion won (KRW 110,437,220,000) for the 2025 fiscal year (April 2025 to March 2026), down 31.2% from 160.6 billion won (KRW 160,592,170,000) the previous year. Operating profit swung from a profit of 3.4 billion won a year earlier to an operating loss of 36.6 billion won (KRW 36,600,000,000), marking a reversal into deficit. Net loss for the year also reached 33.8 billion won (KRW 33,800,000,000).

This poor performance has continued into this year. According to the consolidated audit report of Age Global Holdings, a joint venture between Shinsegae and Alibaba, Aliexpress Korea posted revenue of 8.99 billion won (KRW 8,988,000,000) and a total comprehensive loss of 13.856 billion won (KRW 13,856,000,000) in the first quarter of this year (January to March).

Aliexpress is a global direct purchase platform operated by Alibaba Group. It established its Korean subsidiary in 2018 and entered the Korean market. Initially, it served as a cross-border platform connecting Chinese merchants and Korean consumers. However, following the COVID-19 pandemic and as the global recession fueled demand for 'cost-effectiveness (value for money)' trends, Aliexpress Korea (Limited Company) was founded in August 2023 amid explosive growth. The company introduced 'K-Venue,' a marketplace for Korean sellers, and accelerated its campaign to penetrate the domestic open market by deploying large-scale marketing and discount coupons. In its inaugural year (April 2024 to March 2025), Aliexpress Korea’s revenue remained relatively strong.

However, the competitive environment intensified last year, as Chinese e-commerce platform Temu aggressively expanded into the Korean market and Naver Shopping ramped up its campaign by leveraging AI-powered product search and expedited delivery. As a result, competition in the domestic open market has become even fiercer, leading to last year's disappointing results. 

In response, the Alibaba Group in China continued to provide capital support. AE Management, an Alibaba affiliate, participated in a paid-in capital increase for Aliexpress Korea last year, injecting 129 billion won (KRW 129,000,000,000). Consequently, Aliexpress Korea’s cash and cash equivalents soared from 9.88 billion won (KRW 9,875,900,000) at the end of March last year to 109.9 billion won (KRW 109,911,690,000) this year, more than a tenfold increase.

Meanwhile, Aliexpress Korea was classified as a special affiliate of Shinsegae Group at the end of last year, following the establishment of a 50:50 joint venture between Shinsegae Group and Alibaba Group, Aliexpress's parent company. Through its subsidiary Apollo Korea, Shinsegae contributed 100% of its shares in Gmarket, valued at 3.04 trillion won (KRW 3,040,000,000,000), as an in-kind investment to the joint venture and, in exchange, secured a 50% stake in the joint venture (then named Grand Opus Holdings) owned by Aliexpress International.

As a result, Shinsegae and Alibaba became co-controllers of the joint venture, which incorporated both Gmarket and Aliexpress Korea as subsidiaries. The two companies announced a plan to establish a new e-commerce powerhouse to compete with Coupang and Naver by combining Gmarket’s domestic sales network with Alibaba’s global platform and Southeast Asian network.

The disclosure of these financial results is also due to this change in the company’s ownership structure. Aliexpress Korea became subject to group-wide disclosure requirements for large-scale business groups for the first time after joining the Shinsegae business group. At the beginning of the disclosure report, 'Shinsegae' was listed as the business group name, and 'Lee Myung-hee' as the controlling shareholder. While Aliexpress Korea is an Alibaba affiliate overseas, it is classified under Korea's fair trade regulations as a Shinsegae business group affiliate domestically and therefore subject to large conglomerate disclosure regulations.

With its inclusion into the group-wide disclosure system, Aliexpress Korea’s business transactions with Shinsegae affiliates were also disclosed for the first time. Last year, Aliexpress Korea engaged in goods and services transactions worth 262 million won (KRW 262,000,000) with Shinsegae Food, and, as of the end of the reporting period, held accounts receivable totaling 25 million won (KRW 25,000,000) from Shinsegae Food.

This content was produced with the assistance of AI translation services.