Overview
- Alibaba, which reported results Wednesday, posted revenue of 243.4 billion yuan up 3% year over year as cloud sales rose 38% to 41.6 billion yuan and adjusted EBITA fell 84% with the first operating loss since 2021.
- Executives said AI and cloud investment will exceed the earlier 380 billion yuan plan to gain share, and they expect AI to contribute more than half of cloud revenue within about a year.
- AI product revenue reached 8.97 billion yuan after eleven straight quarters of triple-digit growth, and the Qwen app now lets Taobao shoppers browse, compare, order and track deliveries through natural conversation.
- Free cash flow swung to a 17.3 billion yuan outflow as the company funded data centers, Qwen user growth and one-hour delivery, which weighed on near-term margins and group profitability.
- Shares rose roughly 7% Wednesday after the call as investors focused on the AI-led cloud trajectory and a high-profile U.S.–China visit that lifted hopes for easier access to AI chips.