Alibaba shares fall as earnings and revenue miss estimates

Investing.com-- Alibaba (NYSE: BABA) reported fourth-quarter results that fell short of analyst expectations, with shares declining 4% in premarket trading following the announcement.

The Chinese e-commerce and cloud computing giant posted adjusted earnings per American Depositary Share of RMB7.09, missing the analyst consensus of RMB10.94 by RMB3.85.

Revenue reached RMB284.84 billion, below the RMB289.73 billion estimate and representing a 2% increase YoY. On a like-for-like basis excluding disposed businesses Sun Art and Intime, revenue would have grown 9% YoY.

Adjusted EBITA declined 57% YoY to RMB23.40 billion, primarily due to investments in quick commerce, user experiences, and technology.

The company's Cloud Intelligence Group revenue grew 36%, with AI-related product revenue achieving triple-digit growth for the tenth consecutive quarter.

"The rapid growth of AI + Cloud businesses in recent quarters gives us confidence to scale investments, further strengthening our full-stack AI capabilities," said Toby Xu, Chief Financial Officer of Alibaba Group.

The company's Qwen AI consumer interface surpassed 300 million monthly active users during the quarter. Free cash flow decreased 71% YoY to RMB11.35 billion, mainly attributed to quick commerce investments.

Bloomberg News reported yesterday that Alibaba will raise prices on several AI computing and storage products, with T-Head AI computing chips increasing between 5% and 34%, while Cloud Parallel File Storage will become 30% more expensive.

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