Chinese tech giant Alibaba posts AI-fuelled revenue bump
But net profit slumped 76 per cent on large investments and economic pressure at home.
Chinese tech conglomerate Alibaba reported higher revenue for its most recent quarter, fueled by global artificial intelligence (AI) demand, according to results published on Aug 20. Headquartered in Hangzhou, Alibaba has heavily invested tens of billions of dollars into AI, with investors keen to see how the company will capitalize on the substantial expenditures.
The firm reported a revenue of nearly 269 billion yuan (S$51 billion) in the quarter ending June 30, marking a 9% increase year-over-year, as per the results filed with the Hong Kong Stock Exchange. However, net profit saw a sharp decline of 76% year-over-year to 10.5 billion yuan, attributed to large strategic investments and economic headwinds in its home market.
Alibaba's CEO, Eddie Wu, characterized the quarter as "strong," driven by the "improving commercialization of our full-stack AI capabilities." Wu highlighted that Alibaba Cloud's external revenue growth accelerated by 45%, with AI-related product revenue achieving triple-digit growth for the twelfth consecutive quarter. Known for its open-source "Qwen" AI models, which have gained traction globally among developers, Alibaba is also a dominant player in China's e-commerce market through platforms like Taobao.
The company has faced economic challenges in recent years due to declining consumer spending in China, exacerbating a price war in the e-commerce sector. Recently, Alibaba was labeled by the US Defense Department as a military-linked entity, a claim the firm contested via a lawsuit in a California federal court.
Adding to recent difficulties, Alibaba's designation as a military-linked firm in June has intensified scrutiny. The company previously faced an aggressive regulatory crackdown in China launched in late 2020, driven by concerns in Beijing about the firms' increasing power. Despite the pressures, Alibaba's charismatic co-founder, Jack Ma, made a surprise appearance in February 2025 during a meeting with President Xi Jinping and other business leaders, signaling a potential thaw in relations with Beijing.
Ma, who has since stepped down from his executive role, is believed to retain a substantial shareholding in the company.
Written by urgent.news from Straits Times Business's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
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- Chinese tech giant Alibaba posts AI-fuelled revenue bump freemalaysiatoday.com
- Alibaba Q2 revenue rises 9% as AI cloud demand grows techinasia.com
