Alibaba's Profit Disappoints, but AI Outlook Bright

By Tracy Qu

Alibaba Group's quarterly profit fell as competition in food delivery continued to weigh on earnings, though revenue growth was steady and investors kept their attention on the company's artificial-intelligence progress.

The Hangzhou, China-based company said Thursday that net profit fell 67% on the year in its fiscal third quarter, while revenue grew about 2%.

"Alibaba maintained strong investments across our core pillars of AI and consumption," Chief Executive Eddie Wu said. "AI is and will continue to be one of our primary growth engines."

The earnings come at a pivotal time for Alibaba's sprawling tech empire: It is waging a fierce battle against other Chinese internet companies in food and on-demand delivery, locked in a cycle of promotions and subsidies that has pressured profitability across the sector. Against that backdrop, it is zeroing in on making AI a key engine of growth, continuing to upgrade its Qwen model series and integrating it into its core ecosystem. Its core e-commerce business remains steady.

Alibaba reported net profit of 16.32 billion yuan for the three months ended December, equivalent to $2.37 billion. That missed a FactSet-compiled consensus estimate of 25.74 billion yuan.

Revenue rose slightly to 284.84 billion yuan from 280.15 billion yuan, below analysts' expectations of 285.89 billion yuan.

Write to Tracy Qu at tracy.qu@wsj.com

(END) Dow Jones Newswires

March 19, 2026 06:08 ET (10:08 GMT)