Alibaba Beats the Odds
Alibaba Group shares surged 5.10% to close at $122.25 on Monday, bucking the broader weakness in Chinese equities after the e-commerce and cloud giant delivered quarterly results that surprised to the upside.
The standout performer was Alibaba Cloud, which grew revenue 8% year-over-year — a significant acceleration from the 4% growth posted in the prior quarter. The division's AI-related revenue tripled, driven by demand for model training and inference services.
Alibaba's AI bet is starting to pay off — and the market finally noticed.
E-Commerce Stabilises
The core Taobao and Tmall Group posted modest revenue growth of 3%, a welcome stabilisation after several quarters of decline. Gross merchandise volume grew at a mid-single-digit pace, helped by aggressive discounting during the 618 shopping festival.
International e-commerce continued to be the fastest-growing segment, with AliExpress and Lazada driving a 32% increase in cross-border revenue.
Share Buybacks Boost Confidence
Alibaba repurchased $5.8 billion of its own shares during the quarter, bringing the total buyback programme to over $25 billion in the past 18 months. The aggressive capital return strategy has won favour with value-oriented investors.
Key Metrics
- Cloud revenue: +8% YoY (AI revenue tripled)
- International e-commerce: +32% YoY
- Share buybacks: $5.8B in the quarter
- Stock: $122.25 (+5.10%)
What to Watch
The planned spin-off of Alibaba's logistics arm could unlock further value. Analysts estimate the unit alone could be worth $30-40 billion as a standalone entity.