Alibaba Group Announces September Quarter 2025 Results and Interim Results for the Six Months Ended September 30, 2025
$BABA #alibaba--Alibaba Group Holding Limited (NYSE: BABA and HKEX: 9988 (HKD Counter) and 89988 (RMB Counter), “Alibaba” or “Alibaba Group”) today announced its financial results for the quar...
HONG KONG: $BABA #alibaba--Alibaba Group Holding Limited (NYSE: BABA and HKEX: 9988 (HKD Counter) and 89988 (RMB Counter), “Alibaba” or “Alibaba Group”) today announced its financial results for the quarter ended and the six months ended September 30, 2025.
“We have entered into an investment phase to build long-term strategic value in AI technologies and infrastructure and a consumption platform integrating daily life services and e-commerce. With our significant strategic investments in these areas, our two core businesses of AI + Cloud and consumption continued to deliver strong growth this quarter. 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.
“Our core businesses continued to deliver solid revenue growth, with AI revenue contributing to an expanding share of our cloud revenues from external customers, and customer management revenue up 10%. We are re-investing our profits and free cash flow for the future while near-term profitability is expected to fluctuate. Over the past four quarters, we have deployed approximately RMB120 billion in capital expenditure toward AI and cloud infrastructure,” said Toby Xu, Chief Financial Officer of Alibaba Group.
BUSINESS HIGHLIGHTS
In the quarter ended September 30, 2025:
- Revenue was RMB247,795 million (US$34,808 million), an increase of 5% year-over-year. Excluding revenue from the disposed businesses of Sun Art and Intime, revenue on a like-for-like basis would have grown by 15% year-over-year.
- Income from operations was RMB5,365 million (US$754 million), a decrease of 85% year-over-year, primarily due to the decrease in adjusted EBITA. Adjusted EBITA, a non-GAAP measurement, decreased 78% year-over-year to RMB9,073 million (US$1,274 million), primarily attributable to the investment in quick commerce, user experiences, and technology, partly offset by double-digit revenue growth in Alibaba China E-commerce Group, the improved operating results supported by continued growth in Cloud business, as well as enhanced operating efficiencies across various businesses.
- Net income attributable to ordinary shareholders was RMB20,990 million (US$2,948 million). Net income was RMB20,612 million (US$2,895 million), a decrease of 53% year-over-year, primarily attributable to the decrease in income from operations. Non-GAAP net income in the quarter ended September 30, 2025 was RMB10,352 million (US$1,454 million), a decrease of 72% compared to RMB36,518 million in the same quarter of 2024.
- Diluted earnings per ADS was RMB8.75 (US$1.23). Diluted earnings per share was RMB1.09 (US$0.15 or HK$1.19). Non-GAAP diluted earnings per ADS was RMB4.36 (US$0.61), a decrease of 71% year-over-year. Non-GAAP diluted earnings per share was RMB0.55 (US$0.08 or HK$0.60), a decrease of 71% year-over-year.
- Net cash provided by operating activities was RMB10,099 million (US$1,419 million), a decrease of 68% compared to RMB31,438 million in the same quarter of 2024. Free cash flow, a non-GAAP measurement of liquidity, was an outflow of RMB21,840 million (US$3,068 million), compared to an inflow of RMB13,735 million in the same quarter of 2024. The decrease in free cash flow was mainly attributed to the investment in quick commerce and the increase in our cloud infrastructure expenditure. As of September 30, 2025, our cash and other liquid investments(1) were RMB573,889 million (US$80,614 million).
In the six months ended September 30, 2025:
- Revenue was RMB495,447 million (US$69,595 million), an increase of 3% year-over-year. Excluding revenue from the disposed businesses of Sun Art and Intime, revenue on a like-for-like basis would have grown by 12% year-over-year.
- Income from operations was RMB40,353 million (US$5,668 million), a decrease of 43% year-over-year, primarily due to the decrease in adjusted EBITA, partly offset by a one-time provision(2) in the same period last year. Adjusted EBITA, a non-GAAP measurement, decreased 44% year-over-year to RMB47,917 million (US$6,731 million), primarily attributable to the investment in quick commerce, user experiences, and technology, partly offset by double-digit revenue growth in Alibaba China E-commerce Group, the improved operating results supported by continued growth in Cloud business, as well as enhanced operating efficiencies across various businesses.
- Net income attributable to ordinary shareholders was RMB64,106 million (US$9,005 million). Net income was RMB62,994 million (US$8,849 million), a decrease of 7% year-over-year, primarily attributable to the decrease in income from operations, partly offset by the mark-to-market changes from our equity investments, gain from the disposal of local consumer service business of Trendyol, and the decrease in both the impairment of our investments and net exchange loss. Non-GAAP net income in the six months ended September 30, 2025 was RMB43,862 million (US$6,161 million), a decrease of 43% compared to RMB77,209 million in the same period of 2024.
- Diluted earnings per ADS was RMB26.73 (US$3.75). Diluted earnings per share was RMB3.34 (US$0.47 or HK$3.66). Non-GAAP diluted earnings per ADS was RMB19.10 (US$2.68), a decrease of 39% year-over-year. Non-GAAP diluted earnings per share was RMB2.39 (US$0.34 or HK$2.62), a decrease of 39% year-over-year.
- Net cash provided by operating activities was RMB30,771 million (US$4,322 million), a decrease of 53% compared to RMB65,074 million in the same period of 2024. Free cash flow, a non-GAAP measurement of liquidity, was an outflow of RMB40,655 million (US$5,711 million), compared to an inflow of RMB31,107 million in the same period of 2024. The decrease in free cash flow was mainly attributed to the increase in our cloud infrastructure expenditure and the investment in quick commerce. As of September 30, 2025, our cash and other liquid investments(1) were RMB573,889 million (US$80,614 million).
Reconciliations of GAAP measures to non-GAAP measures presented above are included at the end of this results announcement.
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(1) Cash and other liquid investments represent cash and cash equivalents, short-term investments and other treasury investments included in equity securities and other investments on the consolidated balance sheets, of which that are unrestricted for withdrawal and use.
(2) See the section entitled “Six Months Ended September Other Financial Results” for more information.
BUSINESS AND STRATEGIC UPDATES
Alibaba China E-commerce Group
During the quarter, we executed our plan to reach critical mass scale in quick commerce, improve user experience and enhance operating efficiency. The quick commerce business has substantially improved its unit economics since September, driven by higher fulfillment logistics efficiency, strong customer retention and increasing average order value. As part of our strategy to generate synergies between quick commerce and the rest of Alibaba’s ecosystem, we accelerated the onboarding of Tmall brands to our quick commerce channel to expand product offering and meet consumer needs for on-demand delivery. We had onboarded offline stores from approximately 3,500 Tmall brands to the quick commerce business as of October 31, 2025.
Customer management revenue grew 10% year-over-year to RMB78,927 million (US$11,087 million) during the quarter, primarily driven by the improvement of take rate, which benefited from the increasing penetration of Quanzhantui and the addition of software service fees in September last year. The growing mindshare and increasing scale of our quick commerce business contributed to a rapid year-over-year increase in monthly active consumers on the Taobao app during the quarter, which generated incremental customer management revenue.
We had a successful 11.11 Global Shopping Festival, which delivered double-digit consumer growth year-over-year on the Taobao app, as we implemented user-friendly promotion mechanisms and increased support for merchants that provide high-quality products and customer services.
The number of 88VIP members, our highest spending consumer group, continued to increase by double digits year-over-year, surpassing 56 million. We will continue to focus on improving the retention of 88VIP membership through enhanced value proposition to our most valued customers.
Alibaba International Digital Commerce Group (“AIDC”)
A combination of logistics optimization and investment efficiency enhancement resulted in AIDC’s adjusted EBITA profit of RMB162 million (US$23 million) for the quarter ended September 30, 2025. The unit economics of the AliExpress' Choice business also continued to improve substantially.
This quarter, revenue from AIDC grew 10% year-over-year to RMB34,799 million (US$4,888 million). AIDC's international commerce retail businesses continued to diversify and enrich product offerings by onboarding local merchants and partners, while leveraging the supply chain advantage of the Alibaba ecosystem. AliExpress, in particular, has developed its “AliExpressDirect” model that leverages local inventories in over 30 countries. AliExpress also enhanced the range of our product offerings by launching the “Brand+” program, providing go-to-market solutions to Chinese brands going overseas. In addition, AIDC's international wholesale business further enhanced its AI applications to enhance user experience. During the quarter, our AI-powered B2B procurement engine Accio released its AI Agent version, significantly improving sourcing and procurement efficiency for users.
Cloud Intelligence Group
For the quarter ended September 30, 2025, revenue from Cloud Intelligence Group was RMB39,824 million (US$5,594 million). The year-over-year growth of total revenue, and revenue excluding Alibaba-consolidated subsidiaries, accelerated to 34% and 29% respectively. This momentum was primarily driven by public cloud revenue growth, including the increasing adoption of AI-related products.
AI-related product revenue continued to show strong momentum, delivering another quarter of triple-digit year-over-year growth. We are seeing accelerated adoption of our AI products across a broad range of enterprise customers, with a growing focus on value-added applications including coding assistants. We will continue to invest in anticipation of customer growth and technology innovation, including AI products and services, to increase adoption of AI infrastructure cloud and strengthen our market leadership.
In September at the Apsara Conference, Alibaba Cloud unveiled a major upgrade to our full-stack AI capabilities – spanning from cutting-edge AI foundation models to high-performance AI infrastructure, including servers, high-performance networking, distributed storage, intelligent computing clusters, Platform for AI (PAI), and services for model training and inference. Leveraging our strong AI + Cloud capabilities, Alibaba Cloud continues to contribute actively to open-source community development. As of October 31, 2025, more than 180,000 derivative models had been developed based on the Qwen family on Hugging Face – more than double that of the second player.
Alibaba Cloud continues to lead the market, attracting more customers to adopt our AI products and services. Omdia’s “AI Cloud Market: China – 1H25” reported that Alibaba Cloud ranked first in China’s AI cloud market with the largest share of 35.8%, highlighting our ability to continue leading China's burgeoning AI cloud market through our comprehensive full-stack AI capabilities.
Share Repurchases
During the quarter ended September 30, 2025, we repurchased a total of 17 million ordinary shares (equivalent to approximately 2 million ADSs) for a total of US$253 million. These purchases were made in the U.S. market under our share repurchase program. The remaining amount of Board authorization for our share repurchase program, which is effective through March 2027, was US$19.1 billion as of September 30, 2025.
SEPTEMBER QUARTER SUMMARY FINANCIAL RESULTS
| Three months ended September 30, |
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| 2024 | 2025 |
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| RMB | RMB | US$ | YoY % | ||||
| (in millions, except percentages and per share amounts) | |||||||
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Revenue | 236,503 | 247,795 | 34,808 | 5% | ||||
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Income from operations | 35,246 | 5,365 | 754 | (85)%(2) | ||||
Operating margin | 15% | 2% |
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Adjusted EBITDA(1) | 47,327 | 17,256 | 2,424 | (64)%(2) | ||||
Adjusted EBITDA margin(1) | 20% | 7% |
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Adjusted EBITA(1) | 40,561 | 9,073 | 1,274 | (78)%(2) | ||||
Adjusted EBITA margin(1) | 17% | 4% |
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Net income | 43,547 | 20,612 | 2,895 | (53)%(2) | ||||
Net income attributable to ordinary shareholders | 43,874 | 20,990 | 2,948 | (52)%(2) | ||||
Non-GAAP net income(1) | 36,518 | 10,352 | 1,454 | (72)%(2) | ||||
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Diluted earnings per share(3) | 2.27 | 1.09 | 0.15 | (52)%(2)(4) | ||||
Diluted earnings per ADS(3) | 18.17 | 8.75 | 1.23 | (52)%(2)(4) | ||||
Non-GAAP diluted earnings per share(1)(3) | 1.88 | 0.55 | 0.08 | (71)%(2)(4) | ||||
Non-GAAP diluted earnings per ADS(1)(3) | 15.06 | 4.36 | 0.61 | (71)%(2)(4) | ||||
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| (1) | See the sections entitled “Non-GAAP Financial Measures” and “Reconciliations of Non-GAAP Measures to the Nearest Comparable U.S. GAAP Measures” for more information about the non-GAAP measures referred to within this results announcement. | |
| (2) | The year-over-year decreases were primarily attributable to the investment in quick commerce, user experiences, and technology, partly offset by double-digit revenue growth in Alibaba China E-commerce Group, the improved operating results supported by continued growth in Cloud business, as well as enhanced operating efficiencies across various businesses, while net income attributable to ordinary shareholders and earnings per share/ADS would further take into account the net loss attributable to noncontrolling interests and accretion of mezzanine equity. We excluded non-cash share-based compensation expense, gains/losses of investments, impairment of goodwill and intangible assets, and certain other items from our non-GAAP measurements. | |
(3) |
| Each ADS represents eight ordinary shares. |
(4) |
| The year-over-year percentages as stated are calculated based on the exact amount and there may be minor differences from the year-over-year percentages calculated based on the RMB amounts after rounding. |
SEPTEMBER QUARTER SEGMENT RESULTS
Revenue for the quarter ended September 30, 2025 was RMB247,795 million (US$34,808 million), an increase of 5% year-over-year compared to RMB236,503 million in the same quarter of 2024. Excluding revenue from the disposed businesses of Sun Art and Intime, revenue on a like-for-like basis would have grown by 15% year-over-year.
The following table sets forth a breakdown of our revenue by segment for the periods indicated:
| Three months ended September 30, |
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| 2024 | 2025 |
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| RMB | RMB | US$ | YoY % | ||||
| (in millions, except percentages) | |||||||
Alibaba China E-commerce Group: |
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E-commerce |
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- Customer management | 71,667 | 78,927 | 11,087 | 10% | ||||
- Direct sales, logistics and others(2) | 22,799 | 24,006 | 3,372 | 5% | ||||
| 94,466 | 102,933 | 14,459 | 9% | ||||
Quick commerce(3) | 14,321 | 22,906 | 3,217 | 60% | ||||
China commerce wholesale | 5,986 | 6,739 | 947 | 13% | ||||
Total Alibaba China E-commerce Group | 114,773 | 132,578 | 18,623 | 16% | ||||
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Alibaba International Digital Commerce Group: |
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International commerce retail | 25,618 | 28,068 | 3,943 | 10% | ||||
International commerce wholesale | 6,054 | 6,731 | 945 | 11% | ||||
Total Alibaba International Digital Commerce Group | 31,672 | 34,799 | 4,888 | 10% | ||||
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Cloud Intelligence Group | 29,610 | 39,824 | 5,594 | 34% | ||||
All others(4) | 84,483 | 62,969 | 8,846 | (25)% | ||||
Unallocated | 469 | 577 | 81 |
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Inter-segment elimination | (24,504) | (22,952) | (3,224) |
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Consolidated revenue | 236,503 | 247,795 | 34,808 | 5% | ||||
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| (1) | To advance our “user first” strategy and enhance user experience, during the quarter ended June 30, 2025, we undertook a strategic combination of Taobao and Tmall Group, Ele.me and Fliggy into Alibaba China E-commerce Group. We simplified the financial reporting structure by reclassifying Cainiao, Amap and Digital Media and Entertainment Group (rebranded to Hujing Digital Media and Entertainment Group) into “All others”. The above presentation has been updated to conform with the new reporting structure, as reviewed by our chief operating decision maker. | |
| (2) | Direct sales, logistics and others revenue under Alibaba China E-commerce Group primarily represents direct sales businesses of Tmall Supermarket, Tmall Global and other businesses, where revenue and cost of inventory are recorded on a gross basis within the business group, as well as revenue from logistics services and value-added services. | |
(3) |
| Quick commerce revenue represents quick commerce business revenue, including revenue generated through “Taobao Instant Commerce” and the Ele.me app. Quick commerce revenue is net of subsidies that are contra revenue. |
(4) |
| All others include Freshippo, Cainiao, Alibaba Health, Hujing Digital Media and Entertainment Group, Amap, Intelligent Information Platform (which mainly consists of UCWeb and Quark businesses), Lingxi Games, DingTalk and other businesses. The majority of revenue within All others consists of direct sales, where revenue and cost of inventory are recorded on a gross basis, and revenue from logistics services. The decrease was primarily due to the revenue decrease as a result of the disposal of Sun Art and Intime businesses, as well as the decrease in revenue from Cainiao, partly offset by the increase in revenue from Freshippo, Alibaba Health and Amap. |
The following table sets forth a breakdown of our adjusted EBITA by segment for the periods indicated:
| Three months ended September 30, |
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| 2024 | 2025 |
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| RMB | RMB | US$ | YoY % | ||||
| (in millions, except percentages) | |||||||
Alibaba China E-commerce Group | 44,327 | 10,497 | 1,474 | (76)% | ||||
Alibaba International Digital Commerce Group | (2,905) | 162 | 23 | N/A | ||||
Cloud Intelligence Group | 2,661 | 3,604 | 506 | 35% | ||||
All others | (1,833) | (3,370) | (473) | (84)% | ||||
Unallocated(2) | (1,271) | (1,221) | (172) |
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Inter-segment elimination | (418) | (599) | (84) |
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Consolidated adjusted EBITA | 40,561 | 9,073 | 1,274 | (78)% | ||||
Less: Non-cash share-based compensation expense | (3,666) | (2,882) | (404) |
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Less: Amortization of intangible assets | (1,649) | (826) | (116) |
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