Alibaba Group unveiled the latest financial results on Tuesday for the quarter ended September 30, 2025, with a strategic shift toward massive investments in AI and instant retail and multiple numbers exceeding expectations.
Total revenue for the quarter reached RMB247.80 billion (US$34.81 billion), marking a 5% increase compared to the same period last year. Excluding revenue from the disposed businesses of Sun Art and Intime, like-for-like revenue grew by 15% year-over-year.
The cloud business stood out with a robust growth 34% year-on-year, significantly exceeding market expectations. Alibaba's China ecommerce business also posted solid results, as its revenue increased by 16% year-on-year.
However, investment in quick commerce, user experiences and technology has eroded profitability. Net income decreased 53% year-over-year to RMB20.61 billion (US$2.90 billion). Non-GAAP net income plummeted 72% to RMB10.35 billion (US$1.46 billion).
AI & instant retail focus
This year’s Double 11 shopping festival has seen a significant focus on the emerging trends of AI and instant retail, driven by Alibaba. But due to the price war among instant retail platforms, Chinese e-commerce giants have experienced a significant decline in profits since last quarter. Alibaba’s food delivery platform, Ele.me, quietly underwent a rebranding during the Double 11 shopping season, now known as Taobao Flash Sale (Taobao Shangou). Alibaba has declined to comment on this.
Earlier this year, Alibaba introduced a new tiered loyalty program for Taobao, which effectively integrates its e-commerce, food delivery, and travel services. This initiative is the latest update following the strategic merger of the Ele.me and Fliggy platforms, which now operate under the newly formed China E-commerce Group, alongside Taobao and Tmall.
Alibaba Group has been making recent advances in AI. Its new multipurpose artificial intelligence app, Qwen, achieved over 10 million downloads within the first week of its public beta launch, surpassing OpenAI’s ChatGPT and DeepSeek. This new AI assistant is a primary rival of Google’s Gemini and ChatGPT, as both are not available in the Chinese mainland.
Jack Ma, the founder of Alibaba, made a quiet visit to the Hangzhou campus of Ant Group, an affiliate company of the Chinese conglomerate, last week. This visit coincided with the launch of LingGuang, a next-generation multimodal artificial intelligence assistant developed by the Chinese fintech giant, according to the South China Morning Post (SCMP), which is owned by Alibaba Group.
"Robust AI demand further accelerated our Cloud Intelligence Group business, with revenue up 34% and AI-related product revenue achieving triple-digit year-over-year growth for the ninth consecutive quarter. In our consumption business, quick commerce continued to scale with significant improvement in unit economics and drove rapid growth in monthly active consumers on the Taobao app," said Eddie Wu, chief executive officer of Alibaba Group in a press release.
In May this year, Wu shared an internal letter with all employees, writing, "There is no 'conservatism' in Alibaba's genes, only 'creativity'." Chinese media reported that Alibaba is currently focused on three major battles: investing in AI and cloud infrastructure, enhancing flash sales to develop a large-scale consumption platform, and recently expanding into the AI-to-C sector.
