Alibaba Surges 11% on Cloud and E-Com Growth

Alibaba shares soared in premarket trading after the Chinese tech giant reported a robust quarterly profit fueled by strong performance in its Cloud Intelligence unit and e-commerce operations. 

Net income surged to $6.72 billion for the December quarter, surpassing analyst expectations of $5.9 billion and significantly outpacing the $1.9 billion posted in the same period last year.

The stock has seen an impressive rally of 50% year-to-date on both the New York and Hong Kong exchanges, reflecting renewed investor confidence. 

Cloud Intelligence revenue grew 13% year-over-year, marking the sixth consecutive quarter of triple-digit gains in AI-related product revenue. The company’s strategic investment in AI infrastructure is set to surpass total spending from the past decade, reinforcing its position in the industry’s escalating competition.

Alibaba’s e-commerce segments also posted solid gains. Taobao and Tmall Group saw a 5% rise in revenue, while the International Digital Commerce Group, which includes AliExpress and Lazada, surged 32% year-over-year. 

What Does This Mean for Me?

The broader Chinese retail market showed signs of resilience, with December retail sales rising 3.7% annually, outperforming expectations. Amid concerns over China’s real estate sector, Beijing has implemented aggressive stimulus policies, including interest rate cuts and a five-year fiscal package totaling 10 trillion yuan. 

Despite lingering concerns about consumer sentiment, inflation accelerated at its fastest pace in five months this January, signaling mixed economic signals but providing Alibaba with continued momentum in an evolving digital economy.