Alibaba Group shares soared as much as 8.5% during the morning session in Hong Kong, propelled by robust growth in its Cloud and AI businesses, despite the company missing both top and bottom-line expectations in its fiscal Q4 2026 results.
For the quarter ended March 31, Alibaba reported revenue of 243.4 billion yuan, up 3% year-on-year, but adjusted EBITA fell sharply by 84% to 5.1 billion yuan. The company also recorded its first operating loss in five years at 848 million yuan, compared with a 28.5 billion yuan profit the previous year. Free cash flow was negative 17.3 billion yuan due to significant investments in AI and cloud infrastructure.
E-commerce revenue increased by 6%, although profits declined amid intense competition, particularly in the booming quick commerce segment, where revenue surged 57% but profitability was pressured.
The share rally was underpinned by Alibaba’s strong Cloud and AI results. Cloud revenue jumped 38% year-on-year to 41.6 billion yuan, while Cloud EBITA climbed 57%. AI-related revenue reached 9 billion yuan, growing at triple-digit rates for the eleventh consecutive quarter.
CEO Eddie Wu reiterated confidence that the returns from AI investments will become “very clear” within 3–5 years. Alibaba plans to further ramp up investment in its self-developed AI/Cloud chips and its “Qwan” AI model to solidify its supply chain advantage. The company anticipates annual recurring revenue from AI services to top 10 billion yuan this quarter, and possibly reach 30 billion yuan by year-end.
ttb wealth securities noted in its comment that Bloomberg consensus recommends “Buy” for BABA US, with an average target of $184.51. Meanwhile, Thai investors can invest through BABA80, a depository receipt (DR) issued by KTB.
