Alibaba reported higher quarterly revenue on Wednesday, although heavy spending on artificial intelligence, cloud infrastructure, and instant retail weighed on profit. The Chinese technology group said revenue for the quarter ended March 31 rose 3% year over year to 243.38 billion yuan, or about $36.5 billion.
However, the figure missed the LSEG consensus estimate of 247.22 billion yuan. Alibaba’s adjusted earnings per American Depository Share also came in at 0.62 yuan, far below analyst estimates of 5.79 yuan. Its US-listed shares fell in premarket trading after the results.
Alibaba said net income, excluding one-time items, fell 99.7% during the quarter. Adjusted EBITA dropped 84% year over year to 5.1 billion yuan, or about $750.9 million. The company linked the decline to continued spending on technology businesses and instant retail.
For the full fiscal year ended March 31, Alibaba posted net profit of 105.9 billion yuan, or $15.6 billion. That marked an 18% decline from 129.5 billion yuan in the prior fiscal year. The company continues to face pressure from slow domestic consumption and price competition in China’s e-commerce market.
Alibaba’s Cloud Intelligence Group remained a key growth area. Revenue from the division rose 38% year over year to 41.63 billion yuan, or about $6.13 billion. The result matched estimates and showed strong demand for cloud services linked to AI adoption.
The company said AI-related products accounted for 30% of external customer revenue in the cloud division. Alibaba also reported 9 billion yuan in AI-related revenue. CFO Toby Xu said, “AI-related product revenue achieving triple-digit growth for the eleventh consecutive quarter,” according to the company’s release.
Alibaba has expanded its Qwen AI models across its wider business. This week, the company said it had added Qwen’s agentic features to Taobao, allowing users to shop through an AI assistant instead of browsing product listings manually.
CEO Eddie Wu said, “Alibaba’s full-stack AI investments have progressed from incubation to commercialisation at scale.” He also said the company sees ‘massive potential for agentic AI.’ However, these claims still depend on user adoption, revenue growth, and cost control.
Alibaba earlier separated its AI operations from its cloud computing arm. Eddie Wu now leads the newly formed ‘Alibaba Token Hub’ group as the company works to make AI products more profitable. The company has also said it targets more than $100 billion in combined external revenue from AI and cloud over the next five years.
Alibaba’s China e-commerce revenue reached 122.22 billion yuan, topping estimates of 119.85 billion yuan. The segment includes quick commerce, where orders reach customers within 60 minutes. Revenue in quick commerce rose 57% year over year.
Still, the business added pressure to earnings. Adjusted EBITA in Alibaba’s China e-commerce group fell 40% from a year earlier because of higher spending. Customer management revenue, its largest contributor, rose only 1%.
Meanwhile, Alibaba’s international e-commerce business lagged during the quarter. As a result, total revenue missed market expectations, even as cloud growth and AI demand improved. The company now faces a clear task: expand AI and quick commerce while managing weaker profit margins.
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