E-commerce giant Alibaba Group reported a 39 percent increase year-on-year in its revenue as the quarter ended in March, beating Wall Street's expectation.

The Hangzhou-based company said in its financial report on Thursday that its revenue in the first quarter totaled 24.18 billion yuan ($3.75 billion), the highest growth rate over the past four quarters.

Alibaba attributes the strong growth to China's huge consumption power. Despite the slowdown of China's economic growth, the gross merchandize volume transacted on its China retail marketplaces between January and March was 742 billion yuan, an increase of 24 percent year-on-year.

Joe Tsai, executive vice chairman of Alibaba Group, said in a statement that Chinese households today have aggregate net cash reserves of over $4.6 trillion.

"Chinese consumers, with their healthy balance sheets and ability to spend, will propel China's shift from an export-and investment-led economy to a consumption-driven economy. Alibaba rides on top of this secular tide as we enable more products and services, be it domestic or import, to reach the consumer," he said.

There are 423 million shoppers who have bought something on Alibaba's China retail platform in the past year, and 410 million mobile users who were active on its China retail mobile apps during the month of March.

Daniel Zhang, Chief Executive Officer of Alibaba Group, said that the company's focus on long-term strategic priorities – globalization, rural expansion, building a world-class cloud computing business.

"We want to create a comprehensive media and entertainment platform – we've laid a strong foundation for future growth," said Zhang.

In March, Alibaba announced that it surpassed 3 trillion yuan in annual GMV, a milestone that marks the company's status as the world's largest retailer in terms of sales volume.

It said that its sales volume in the current fiscal year, which will end in March 2017, is on track to overtake the GDP of Sweden.