Alibaba Group (BABA) Q2 2026 earnings summary

Executive summary

• Revenue for the quarter ended September 30, 2025, grew 5% year-over-year to RMB247,795 million, with like-for-like revenue (excluding disposed businesses) up 15%, driven by strong AI+Cloud and consumption strategies.

• Cloud Intelligence Group revenue surged 34% year-over-year, with AI-related product revenue achieving triple-digit growth for the ninth consecutive quarter.

• Quick commerce scaled rapidly, improving user experience, narrowing unit economics loss, and boosting monthly active consumers on the Taobao app.

• Strategic focus remains on AI+ cloud and consumption, with significant progress in AI infrastructure, foundation models, and consumer-facing AI applications.

• Significant capital expenditure of approximately RMB120 billion over the past four quarters toward AI and cloud infrastructure.

Financial highlights

• Consolidated revenue was RMB247,795 million, up 5% year-over-year; like-for-like revenue (excluding Sun Art and InTime) grew 15%.

• Net income attributable to ordinary shareholders was RMB20,990 million, down 52% year-over-year; GAAP net income was RMB20,612 million, down 53%.

• Income from operations dropped 85% year-over-year to RMB5,365 million, mainly due to increased investment in quick commerce, user experience, and technology.

• Adjusted EBITA declined 78% year-over-year to RMB9,073 million.

• Free cash flow for the quarter was negative RMB21,840 million, with net cash provided by operating activities at RMB10,099 million.

Outlook and guidance

• Continued decisive investment in AI+ cloud and consumption to drive long-term growth, with expectations for further technology and market share gains.

• Quick commerce is expected to be a core pillar, with a goal to generate CNY 1 trillion in GMV within three years.

• Near-term profitability expected to fluctuate as profits and free cash flow are reinvested for future growth.

• CapEx for AI infrastructure may exceed the previously planned RMB 380 billion over three years, depending on supply chain and demand.