Alibaba Misses Q4 Revenue Forecast; Net Income Plunges 66%
Alibaba Group reported December-quarter revenue of 284.8 billion yuan, missing analyst estimates of 290.7 billion yuan, while net income plunged 66% to 15.6 billion yuan. Operating income fell 74% and free cash flow declined 71% due to heavy spending on quick commerce, AI, and technology investments.
1. Quarterly Results
Alibaba posted 284.8 billion yuan in December-quarter revenue, below the 290.7 billion yuan consensus, marking 2% year-on-year growth. Net income collapsed 66% to 15.6 billion yuan, while operating income declined 74%.
2. Segment Performance
China e-commerce revenue rose 6% to 159.3 billion yuan with customer management up 1%, international digital commerce grew 4% to 39.2 billion yuan, and Cloud Intelligence revenue surged 36% to 43.3 billion yuan.
3. Profitability and Cash Flow
Adjusted EBITA fell 57% to 23.4 billion yuan with margins down 12 percentage points, operating cash flow dropped 49% and free cash flow fell 71% due to elevated quick commerce and technology spending.
4. Strategic Investments and Outlook
Alibaba accelerated investments in quick commerce, AI infrastructure, and proprietary chips to drive enterprise and consumer AI growth, positioning for long-term margin recovery despite near-term cost pressures.