Investment Rating - The report maintains a "Hold" rating for Alibaba Group [5][17]. Core Insights - Alibaba's FY2Q25 revenue reached RMB 236.5 billion, a year-on-year increase of 5%, slightly below market expectations by 1%. Adjusted net profit was RMB 36.5 billion, down 9% year-on-year, but better than market expectations by 3% [3][5]. - The Taobao and Tmall segment showed stable growth with a revenue increase of 1% to RMB 99 billion, driven by a double-digit growth in order volume. The average order value decreased, but the number of buyers reached a historical high during the "Double Eleven" shopping festival [4]. - The international e-commerce segment saw a significant revenue increase of 29% to RMB 31.7 billion, primarily driven by the AliExpress Choice business [4]. - Cloud business revenue grew by 7% year-on-year to RMB 29.6 billion, with public cloud products experiencing double-digit growth and AI-related products achieving triple-digit growth. The adjusted EBITA margin improved to 9% [5]. Financial Summary - FY25E revenue forecast is adjusted to RMB 990.5 billion, with a net profit forecast of RMB 140.7 billion. For FY26E, revenue is projected at RMB 1,064.4 billion and net profit at RMB 145.4 billion [5][7]. - The adjusted target price is set at HKD 91 and USD 94, corresponding to FY25E/FY26E P/E ratios of 11.6x and 11.2x respectively [5][17].

Investment Rating - The investment rating for Alibaba-SW (09988.HK) is maintained at "Buy" [2][7]. Core Insights - The report indicates that Alibaba's FY2025 Q2 performance met expectations, with a focus on the competitive landscape in the e-commerce sector. The monetization rate for Taotian has stabilized, and non-e-commerce businesses continue to improve, leading to a slight upward revision of the FY2025 adjusted net profit forecast to 151.7 billion yuan [7][8]. - The report anticipates that the domestic e-commerce market share will stabilize, with a potential rebound in monetization rates and continued strong growth in international e-commerce and improvements in Alibaba Cloud profitability [7][8]. Summary by Sections Financial Performance - FY2025 Q2 revenue grew by 5% year-on-year, while non-GAAP net profit declined by 9%, aligning with Bloomberg consensus expectations. Taotian's customer management revenue increased by 2% year-on-year, with a stable monetization rate [8]. - The International Business Group saw a 29% year-on-year revenue increase, while the Cloud Intelligence Group's revenue grew by 7%, with public cloud product revenue experiencing double-digit year-on-year growth [8]. Profitability Forecast - The adjusted net profit forecast for FY2025 is set at 151.7 billion yuan, with projections for FY2026 and FY2027 at 170.7 billion yuan and 189.1 billion yuan, respectively. Corresponding year-on-year growth rates are expected to be -3.7%, 12.5%, and 10.8% [7][11]. - The report highlights that the diluted EPS for FY2025 is projected at 8.1 yuan, with P/E ratios of 9.8, 8.5, and 7.5 for FY2025, FY2026, and FY2027, respectively [11]. Market Dynamics - The report notes that Taotian will continue to invest in user experience to capture market share, with potential fluctuations in profit margins. The number of 88VIP members reached 46 million, supported by low-price subsidies and partnerships with Tencent [9]. - A share buyback program valued at 14.7 billion USD was executed in 2024, representing approximately 6.9% of the market value at that time, with an additional buyback capacity of 22 billion USD remaining [9].

Investment Rating - The report maintains an "Overweight" rating for Alibaba-W (9988 HK) with a target price of 121 HKD for FY2025 [2] Core Views - Alibaba's Take Rate has stabilized due to service fees and full-site promotion, with continued investments in supply chain and user experience improvement [1][2] - Cloud Intelligence segment's profitability significantly exceeded expectations, with multiple businesses showing substantial reductions in losses [1][2] - The company's share repurchase program is progressing steadily, with a 24% YoY increase in repurchase amount to $4.1 billion in the quarter [2] Financial Performance - Alibaba's FY2025E-FY2027E revenue is forecasted at 10218/11234/12049 billion RMB, with adjusted net profit of 1441/1825/1905 billion RMB [2] - Taobao and Tmall Group's revenue reached 990 billion RMB in CY24Q3, a 1% YoY increase, with customer management revenue up 2% to 704 billion RMB [2] - Cloud Intelligence revenue grew 7% YoY to 296 billion RMB, with adjusted EBITA surging 89% to 26.6 billion RMB [2] Business Segment Analysis Taobao and Tmall Group - Revenue increased 1% YoY to 990 billion RMB in CY24Q3, driven by double-digit order growth and 88VIP membership reaching 46 million [2] - Take Rate remained stable YoY, with a 0.6% service fee introduced in September expected to contribute fully in CY24Q4 [2] Cloud Intelligence Group - AI-related revenue has maintained triple-digit growth for five consecutive quarters [2] - The group reduced Tongyi Qianwen API prices while advancing scale effects and technological advantages [2] International Commerce - Revenue grew 29% YoY, primarily driven by strong growth in Choice [2] - Adjusted EBITA improved significantly to -29 billion RMB, better than the expected -36 billion RMB [2] Local Services and Digital Media - Local services revenue increased 14% YoY to 177 billion RMB, with adjusted EBITA margin improving by 14 percentage points to -2% [21] - Digital media and entertainment revenue decreased 1% YoY to 57 billion RMB, with adjusted EBITA margin improving by 0.4 percentage points to -3.1% [25] Share Repurchase - The company repurchased $4.1 billion worth of shares in the quarter, a $2.4 billion YoY increase [2] - FY2025 cumulative net share reduction reached 4.4%, with $22 billion remaining in the repurchase program [2] Valuation - The sum-of-the-parts valuation for FY25E stands at 2696 billion RMB, with a 20% holding discount applied [28] - The target price for US-listed BABA is $125, while the HK-listed 9988 HK target is 121 HKD [28]

Investment Rating - The report maintains a "Buy" rating for Alibaba Group (9988.HK) [1] Core Views - Alibaba's commercialization strategy is steadily advancing, focusing on high-quality GMV growth, with core business showing robust growth [4][39] - The company reported a revenue of 236.5 billion yuan for FY2025Q2, reflecting a year-over-year increase of 5% [2][12] - The adjusted EBITDA for the same period was 47.3 billion yuan, down 4% year-over-year [2][12] Financial Performance Summary - **Overall Performance**: For FY2025Q2, Alibaba achieved a net profit of 43.5 billion yuan, a significant increase of 63% year-over-year, and a 81% increase quarter-over-quarter [2][12][13] - **Segment Performance**: - **Taobao Group**: Revenue reached 99 billion yuan, with a year-over-year growth of 1%. The adjusted EBITA was 44.6 billion yuan, with an EBITA margin of 45% [4][39] - **International Digital Commerce Group**: Revenue grew by 29% year-over-year to 31.7 billion yuan, driven by strong growth in cross-border business [44] - **Cloud Intelligence Group**: Revenue increased by 7% year-over-year to 29.6 billion yuan, with AI-related revenue showing triple-digit growth for five consecutive quarters [49] - **Profitability Metrics**: The operating profit margin was 14.9%, and the net profit margin was 18.4% for FY2025Q2 [36] Revenue Forecast and Valuation - The report adjusts revenue forecasts for FY2025-2027, estimating revenues of 1,005.9 billion yuan, 1,110.6 billion yuan, and 1,222.8 billion yuan respectively [51] - The target market capitalization for FY2025 is set at 2,055.6 billion yuan, corresponding to a target price of 107 yuan per share [51][52]

Investment Rating - The report maintains a "Buy" rating for Alibaba Group (9988.HK) [6][8]. Core Insights - In Q2 FY2025, the company reported a revenue increase of 5.21% year-on-year, with net profit attributable to ordinary shareholders rising by 58.36% [3][6]. - The company has a significant marketing investment, with 88VIP membership reaching 46 million, showing double-digit growth [5][6]. - The adjusted non-GAAP net profit forecast for FY2025 has been reduced by 5% to 155.1 billion yuan, while forecasts for FY2026 and FY2027 have been increased by 1% and 7% respectively [6]. Financial Performance Summary - For 1HFY2025, the company achieved a revenue of 479.739 billion yuan, a year-on-year increase of 4.53%, and a net profit of 68.143 billion yuan, up 9.84% [3]. - The comprehensive gross margin for 1HFY2025 was 39.52%, an increase of 0.97 percentage points year-on-year [4]. - The company repurchased 4.14 million shares for 4.1 billion USD, with 22 billion USD remaining under the buyback plan [5]. Profitability Metrics - The comprehensive gross margin for Q2 FY2025 was 39.10%, up 1.23 percentage points year-on-year [4]. - The period expense ratio for 1HFY2025 was 25.10%, an increase of 3.84 percentage points year-on-year [4]. - The company’s revenue projections for FY2025 to FY2027 are 1,011.7 billion yuan, 1,181.0 billion yuan, and 1,180.9 billion yuan respectively, with growth rates of 7.49%, 8.73%, and 7.36% [7][17].

证券研究报告 | 2024年11月17日 阿里巴巴-W（09988.HK） 优于大市 2QFY25 财报点评：测算淘天 GMV yoy+2%，淘天以外业务降本 增效成效显著 整体表现：收入平稳增长，淘天以外业务降本增效成效显著。2QFY2025，公 司实现营业收入 2365 亿元，同比增长 5%，增速平稳。其中国际数字商业集 团、云业务、本地生活集团、菜鸟集团对增速拉动明显，淘天集团和大文娱 增速相对平淡。本季度公司 Non-GAAP 净利润为 365 亿元，同比下降 9%， Non-GAAP 净利率 15%；经调整 EBITA 同比下降 5%至 406 亿元，经调整 EBITA 利润率同比下降 2pct，主要由于国内电商业务加大投入。公司本季度回购 41 亿美元（5200 万股 ADs），已考虑员工持股计划下发行的股份后，回购计 划使得流通股净减少 2.1%。目前股份回购计划仍有 220 亿美金额度（效期至 2027 年 3 月）。 淘天集团：收入增长平淡，公司将持续在商家和用户端投入。本季度淘天集 团收入同比+1%至 990 亿元，其中零售客户管理收入同比+2%，直营及其他收 入同比-5%，批发商业同比+ ...

Investment Rating - The report maintains a "Buy" rating for Alibaba Group [5][13]. Core Insights - The company achieved revenue of 236.5 billion RMB in FY2Q2025, a year-over-year increase of 5.2%, which was 1.2% below consensus expectations. International commerce, local services, and other revenues exceeded expectations, while Taobao and Tmall commerce, as well as cloud intelligence revenues, met expectations. However, Cainiao and entertainment revenues fell short of expectations [1]. - Operating profit reached 35.2 billion RMB, a year-over-year increase of 5.0%, surpassing consensus expectations by 7.6%, primarily due to a reduction in non-cash equity incentive expenses [1]. - Adjusted EBITA was 40.6 billion RMB, down 5.3% year-over-year, which was 1.3% below consensus expectations, mainly due to increased investments in domestic and overseas e-commerce businesses [1]. - Non-GAAP net profit was 36.5 billion RMB, a year-over-year decrease of 9.1%, but exceeded consensus expectations by 2.5%, largely due to significantly higher-than-expected investment income [1]. - The report indicates that the company is focusing on its core business and user engagement, which is expected to improve the competitive landscape. Although EBITA is under pressure in the short to medium term, there are signs of a recovery in profitability, and shareholder returns are becoming more visible [1]. Revenue and Profit Forecast - Revenue forecasts for FY2025-2027 are projected at 1,001.9 billion RMB, 1,105.3 billion RMB, and 1,205.3 billion RMB, respectively. Non-GAAP net profits are expected to be 151.7 billion RMB, 174.2 billion RMB, and 192.3 billion RMB for the same periods, corresponding to current price-to-earnings ratios of 10.1, 8.8, and 8.0 times [1][13]. Business Segment Performance - **Taotian Group**: Revenue for FY2Q2025 was 99 billion RMB, a year-over-year increase of 1.4%, aligning with consensus expectations. Adjusted EBITA was 44.6 billion RMB, with a profit margin of 45.1%, slightly below expectations [1]. - **International Commerce**: Revenue reached 31.7 billion RMB, a year-over-year increase of 29.2%, exceeding consensus expectations by 1.2%. Retail business revenue grew by 35.0% [2]. - **Local Services**: Revenue was 17.7 billion RMB, a year-over-year increase of 13.8%, surpassing consensus expectations by 1.6%. The segment's losses narrowed significantly due to improved operational efficiency [3]. - **Cainiao**: Revenue was 24.6 billion RMB, a year-over-year increase of 8.0%, but fell short of expectations by 8.6% [4]. - **Cloud Intelligence Group**: Revenue was 29.6 billion RMB, a year-over-year increase of 7.1%, with adjusted EBITA of 2.7 billion RMB, reflecting a significant improvement in profitability [11]. - **Entertainment**: Revenue was 5.7 billion RMB, a year-over-year decrease of 1.5%, which was below expectations by 9.7% [12].

Investment Rating - The report maintains a "Buy" rating for Alibaba Group (9988.HK) [3] Core Views - Alibaba's revenue for FY25Q2 reached 236.5 billion RMB, a year-over-year increase of 5.2%, while GAAP net profit was 43.5 billion RMB, reflecting a year-over-year decrease of 9.1% [1] - The report highlights marginal improvement in Taobao's Customer Management Revenue (CMR) growth, driven by an increase in Gross Merchandise Volume (GMV) [2] - Cloud business revenue grew by 7.1% year-over-year, with a notable increase in AI-related product revenue [2] - The report emphasizes the potential for Alibaba's CMR business to stabilize and grow, alongside significant growth prospects in the cloud business driven by AI [2] Summary by Sections Financial Performance - Taobao's FY25Q2 revenue was 99.9 billion RMB, up 1.4% year-over-year, with retail revenue at 93.0 billion RMB, a 0.5% increase [2] - The adjusted EBITA for Taobao was 44.6 billion RMB, down 5.3% year-over-year, with a profit margin of 45.0% [2] - Cloud business revenue for FY25Q2 was 29.6 billion RMB, with an adjusted EBITA of 2.7 billion RMB, reflecting an 88.9% year-over-year increase [2] Shareholder Returns - The company repurchased 4.14 million shares for 41 billion USD in the quarter, with a total repurchase of 87 billion USD in the first half of the fiscal year [2] Future Projections - The report forecasts adjusted EPS for FY2025, FY2026, and FY2027 to be 7.63 RMB, 8.58 RMB, and 9.42 RMB respectively, with corresponding adjusted PE ratios of 11, 9, and 9 times [2]

Financial Performance - Revenue for the quarter ended September 30, 2024, was RMB 236.50 billion (USD 33.70 billion), representing a year-over-year growth of 5%[3] - Operating profit for the same quarter was RMB 35.25 billion (USD 5.02 billion), also up 5% year-over-year, primarily due to a decrease in non-cash equity incentive expenses[3] - Net profit attributable to ordinary shareholders was RMB 43.87 billion (USD 6.25 billion), a significant increase of 63% year-over-year, driven by changes in the fair value of equity investments and reduced impairment losses[3] - The diluted earnings per American depositary share were RMB 18.17 (USD 2.59), while the non-GAAP diluted earnings per share were RMB 15.06 (USD 2.15), reflecting a 4% year-over-year decline[4] - Cash flow from operating activities was RMB 31.44 billion (USD 4.48 billion), down 36% compared to the same period last year[4] - The total revenue for the quarter was RMB 236.503 billion (USD 33.701 billion), representing a 5% year-over-year growth[17] - Net profit attributable to ordinary shareholders increased by 58% year-over-year to RMB 43.874 billion (USD 6.252 billion) for the quarter[17] - The diluted earnings per share rose by 69% year-over-year to RMB 2.27 (USD 0.32) for the quarter[17] - Adjusted EBITA for the company was RMB 44,590 million (USD 6,354 million), a 5% decrease from RMB 47,077 million in the same period of 2023, primarily due to increased investments in user experience[23] - Adjusted EBITDA for the same period was RMB 47,327 million (USD 6,744 million), down 4% from RMB 49,237 million year-over-year[46] - Net profit for the three months ended September 30, 2024, was RMB 43,547 million (USD 6,205 million), an increase from RMB 26,696 million in the same period of 2023[53] - The company reported a net loss of RMB 1,478 million (USD 211 million) in other net income (expenses) for the three months ended September 30, 2024, compared to a net income of RMB 1,391 million in the same period of 2023[49] Revenue Growth by Segment - Cloud Intelligence Group revenue for the quarter was RMB 29.61 billion (USD 4.22 billion), marking a 7% year-over-year increase, driven by double-digit growth in public cloud services[8] - AIDC revenue for the quarter ended September 30, 2024, increased by 29% year-over-year to RMB 31.672 billion (USD 4.513 billion) driven by cross-border business growth, particularly from AliExpress Choice[11] - Cainiao's revenue for the same quarter grew by 8% year-over-year to RMB 24.647 billion (USD 3.512 billion), primarily due to increased revenue from cross-border logistics fulfillment solutions[12] - Local Life Group's revenue increased by 14% year-over-year to RMB 17.725 billion (USD 2.526 billion), supported by order growth from Gaode and Ele.me, as well as increased marketing service revenue[13] - International retail business revenue grew by 35% to RMB 25,618 million (USD 3,650 million), driven by growth from AliExpress Choice and Trendyol[27] - International wholesale business revenue increased by 9% to RMB 6,054 million (USD 863 million), mainly due to growth in value-added service revenue related to cross-border business[28] - Revenue from the China retail business was RMB 93,008 million (USD 13,254 million), a 0% change year-over-year, with customer management revenue growing by 2% due to online GMV growth[21] - Revenue from the China wholesale business increased by 18% to RMB 5,986 million (USD 853 million), driven by increased value-added service revenue for paid members[22] Cost and Expenses - Operating costs for the three months ended September 30, 2024, were RMB 144,029 million (USD 20,524 million), accounting for 60.9% of revenue, down from 62.1% in the same period of 2023[39] - Sales and marketing expenses for the three months ended September 30, 2024, were RMB 32,471 million (USD 4,627 million), accounting for 13.7% of revenue, up from 11.3% in the same period of 2023, primarily due to increased investment in e-commerce[40] - The amortization of intangible assets for the three months ended September 30, 2024, was RMB 1,649 million (USD 235 million), a decrease of 32% compared to RMB 2,431 million in the same period of 2023[46] - General and administrative expenses for the six months ended September 30, 2024, were RMB 23,057 million (USD 3,285 million), accounting for 4.8% of revenue, compared to RMB 16,705 million (3.6%) in the same period of 2023[84] Cash Flow and Investments - Free cash flow for the same period was RMB 13,735 million (USD 1,957 million), down 70% from RMB 45,220 million year-over-year[58] - The net cash flow from operating activities for the six months ending September 30, 2024, was RMB 65,074 million (USD 9,273 million), a decline of 31% compared to RMB 94,537 million in 2023[100] - The net cash used in investing activities for the six months ending September 30, 2024, was RMB 34,865 million (USD 4,968 million)[101] - The net cash used in financing activities for the same period was RMB 86,364 million (USD 12,307 million)[102] - Cash and cash equivalents, short-term investments, and other financial investments totaled RMB 554,378 million (USD 78,998 million) as of September 30, 2024, down from RMB 617,230 million on March 31, 2024[99] Share Repurchase and Equity - The company repurchased a total of 414 million ordinary shares for a total of USD 4.1 billion, reducing the number of shares outstanding by 2.1%[16] - The company repurchased shares amounting to RMB 72,889 million (USD 10,387 million) during the six months ending September 30, 2024[102] - The company repurchased 118,628,800 ordinary shares at a price of USD 10.10 per share for a total consideration of approximately USD 1.2 billion on May 23, 2024[140] - The company repurchased 565,732,208 American Depositary Shares (ADS) for a total consideration of USD 5.507 billion during the six months ended September 30, 2024[139] Employee and Governance - The total number of employees as of September 30, 2024, was 197,991, a slight decrease from 198,162 as of June 30, 2024[60] - The company has established comprehensive learning and training programs to support employee growth and long-term career development[136] - The company has complied with the corporate governance code since its transition to primary listing status on August 28, 2024[141] - The audit committee has reviewed the unaudited consolidated interim results for the six months ended September 30, 2024[143]

Revenue and Profit Performance - Revenue for the quarter reached RMB 236.503 billion (USD 33.701 billion), a 5% year-over-year increase[5] - Operating profit was RMB 35.246 billion (USD 5.023 billion), up 5% year-over-year, driven by reduced non-cash share-based compensation expenses[5] - Net income attributable to ordinary shareholders was RMB 43.874 billion (USD 6.252 billion), with net profit increasing 63% year-over-year to RMB 43.547 billion (USD 6.205 billion)[5] - Alibaba's total revenue for Q3 2024 was RMB 236.50 billion (USD 33.70 billion), a 5% YoY increase, with net income attributable to ordinary shareholders rising 58% YoY to RMB 43.87 billion (USD 6.25 billion)[18] - Total revenue for the September 2024 quarter was RMB 236,503 million (USD 33,701 million), a 5% YoY increase from RMB 224,790 million in the same period last year[19] - Revenue for the three months ending September 30, 2024, was RMB 236,503 million (USD 33,701 million), an increase from RMB 224,790 million in the same period in 2023[74] - Net profit attributable to Alibaba Group shareholders for the six months ending September 30, 2024, was RMB 68,423 million (USD 9,750 million), up from RMB 62,089 million in the same period in 2023[74] - Net profit for the three months ended September 30, 2024, was RMB 43,547 million (USD 6,205 million), compared to RMB 26,696 million in the same period of 2023[53] - Net profit attributable to ordinary shareholders for the three months ended September 30, 2024, was RMB 43,874 million (USD 6,252 million), compared to RMB 27,706 million in the same period of 2023[54] - Net profit for the three months ended September 30, 2024, was RMB 43,547 million (USD 6,205 million), up from RMB 26,696 million in the same period in 2023[78] Cloud Intelligence Group Performance - Cloud Intelligence Group revenue grew 7% year-over-year to RMB 29.610 billion (USD 4.219 billion), with AI-related products achieving triple-digit growth for five consecutive quarters[9] - Public cloud product revenue saw double-digit growth, contributing to overall revenue growth of over 7% excluding revenue from consolidated businesses[9] - Cloud Intelligence Group revenue increased 7% YoY to RMB 29,610 million (USD 4,219 million)[19] - Cloud Intelligence Group revenue increased by 7% YoY to RMB 29,610 million (USD 4,219 million), driven by double-digit growth in public cloud products, including AI-related products[26] - Cloud Intelligence Group adjusted EBITA surged 89% YoY to RMB 2,661 million (USD 379 million), primarily due to a shift towards higher-margin public cloud products and improved operational efficiency[27] Taobao and Tmall Performance - Taobao and Tmall's GMV growth was driven by double-digit order volume growth, with 88VIP members reaching 46 million, a double-digit year-over-year increase[8] - During the Double 11 shopping festival, Taobao and Tmall achieved strong GMV growth and a record number of buyers[8] - Taotian Group's revenue from China retail commerce reached RMB 93,008 million (USD 13,254 million), with customer management revenue growing 2% YoY due to online GMV growth[23] - Taotian Group's adjusted EBITA decreased 5% YoY to RMB 44,590 million (USD 6,354 million), primarily due to increased investments in user experience[25] Alibaba International Digital Commerce Group Performance - Alibaba International Digital Commerce Group (AIDC) revenue increased 29% YoY to RMB 31.67 billion (USD 4.51 billion) in Q3 2024, driven by cross-border business growth[12] - Alibaba International Digital Commerce Group's total revenue grew 29% YoY to RMB 31,672 million (USD 4,513 million), with international retail commerce up 35% and wholesale commerce up 9%[19] - International Digital Commerce Group's retail revenue grew 35% YoY to RMB 25,618 million (USD 3,650 million), driven by growth in AliExpress Choice and Trendyol[28] - International Digital Commerce Group's wholesale revenue increased by 9% YoY to RMB 6,054 million (USD 863 million), supported by growth in cross-border value-added services[29] - Alibaba International Digital Commerce Group's adjusted EBITA surged 89% YoY to RMB 2,661 million (USD 379 million)[22] Cainiao Group Performance - Cainiao Group revenue grew 8% YoY to RMB 24.65 billion (USD 3.51 billion) in Q3 2024, primarily driven by cross-border logistics fulfillment solutions[13] - Cainiao Group revenue rose 8% YoY to RMB 24,647 million (USD 3,512 million)[19] - Cainiao Group revenue rose 8% YoY to RMB 24,647 million (USD 3,512 million), primarily due to growth in cross-border logistics fulfillment solutions[31] - Cainiao Group's adjusted EBITA loss widened significantly to RMB 2,905 million (USD 414 million), a 657% YoY increase in losses[22] Local Services Group Performance - Local Services Group revenue increased 14% YoY to RMB 17.73 billion (USD 2.53 billion) in Q3 2024, with Gaode's daily active users peaking at over 300 million during the National Day holiday[14] - Local Services Group revenue grew 14% YoY to RMB 17,725 million (USD 2,526 million)[19] - Local Services Group revenue increased by 14% YoY to RMB 17,725 million (USD 2,526 million), driven by order growth in Amap and Ele.me, as well as marketing service revenue growth[33] Digital Media and Entertainment Group Performance - Digital Media and Entertainment Group revenue decreased 1% YoY to RMB 5.69 billion (USD 811 million) in Q3 2024, with narrowing losses due to increased advertising revenue and content investment efficiency[15] Share Repurchases and Financial Position - The company repurchased USD 4.1 billion worth of shares, reducing outstanding shares by 2.1% compared to the end of June[4] - Alibaba repurchased 414 million ordinary shares (equivalent to 52 million ADSs) for a total of USD 4.1 billion in Q3 2024, reducing outstanding shares by 2.1%[17] - Cash, cash equivalents, short-term investments, and other financial investments totaled RMB 554,378 million (USD 78,998 million) as of September 30, 2024, down from RMB 617,230 million as of March 31, 2024[57] - Total assets as of September 30, 2024, were RMB 1,762,712 million (USD 251,184 million), slightly down from RMB 1,764,829 million as of March 31, 2024[75][76] - Cash and cash equivalents decreased to RMB 182,992 million (USD 26,076 million) as of September 30, 2024, from RMB 248,125 million as of March 31, 2024[75] - Total liabilities increased to RMB 704,834 million (USD 100,438 million) as of September 30, 2024, from RMB 652,230 million as of March 31, 2024[76] - Total equity attributable to shareholders was RMB 953,925 million (USD 135,933 million) as of September 30, 2024, down from RMB 986,544 million as of March 31, 2024[76] - Total current assets decreased to RMB 609,102 million (USD 86,796 million) as of September 30, 2024, from RMB 752,864 million as of March 31, 2024[75] Cash Flow and Free Cash Flow - Free cash flow decreased by 70% year-over-year to RMB 13.735 billion (USD 1.957 billion), primarily due to investments in Alibaba Cloud infrastructure and refunds to Tmall merchants[6] - Net cash provided by operating activities for the three months ended September 30, 2024, was RMB 31,438 million (USD 4,480 million), a 36% decrease from RMB 49,231 million in the same period of 2023[58] - Free cash flow for the three months ended September 30, 2024, was RMB 13,735 million (USD 1,957 million), a 70% decrease from RMB 45,220 million in the same period of 2023[58] - Net cash used in financing activities for the three months ended September 30, 2024, was RMB 66,782 million (USD 9,516 million), primarily due to share repurchases and dividend payments[60] - Operating cash flow for the three months ended September 30, 2024, was RMB 31,438 million (USD 4,480 million), a decrease from RMB 49,231 million in the same period in 2023[77] - Net cash used in financing activities for the six months ended September 30, 2024, was RMB 86,364 million (USD 12,307 million), compared to RMB 37,018 million in the same period in 2023[77] - Free cash flow for the six months ended September 30, 2024, was RMB 31,107 million (USD 4,433 million), compared to RMB 84,309 million in the same period of 2023[81] - Net cash provided by operating activities for the six months ended September 30, 2024, was RMB 65,074 million (USD 9,273 million), compared to RMB 94,537 million in the same period of 2023[81] - Purchases of property and equipment (excluding land use rights and construction in progress related to corporate campuses) for the three months ended September 30, 2024, were RMB 16,977 million (USD 2,419 million), up from RMB 4,112 million in the same period of 2023[81] - Purchases of property and equipment (excluding land use rights and construction in progress related to corporate campuses) for the six months ended September 30, 2024, were RMB 28,916 million (USD 4,120 million), compared to RMB 10,119 million in the same period of 2023[81] - Changes in buyer protection fund for the three months ended September 30, 2024, were RMB -726 million (USD -104 million), compared to RMB 101 million in the same period of 2023[81] - Changes in buyer protection fund for the six months ended September 30, 2024, were RMB -5,051 million (USD -720 million), compared to RMB -109 million in the same period of 2023[81] Expenses and Costs - Total costs and expenses for the quarter were RMB 202,108 million (USD 28,799 million), accounting for 60.9% of revenue, down from 62.1% in the same period last year[40] - Product development expenses for the quarter were RMB 14,182 million (USD 2,020 million), accounting for 6.0% of revenue, down from 6.3% in the same period last year[41] - Sales and marketing expenses for the three months ended September 30, 2024, were RMB 32,471 million (USD 4,627 million), accounting for 13.7% of revenue, compared to RMB 25,485 million (11.3% of revenue) in the same period of 2023[42] - General and administrative expenses for the three months ended September 30, 2024, were RMB 9,777 million (USD 1,393 million), accounting for 4.1% of revenue, compared to RMB 9,408 million (4.2% of revenue) in the same period of 2023[42] - Equity incentive expenses for the three months ended September 30, 2024, were RMB 4,146 million (USD 591 million), a 39% decrease compared to RMB 6,830 million in the same period of 2023[43] - Non-cash share-based compensation expenses for the six months ended September 30, 2024, were RMB 7,775 million (USD 1,108 million), up from RMB 5,201 million in the same period in 2023[79] - Provision for shareholder class action lawsuits for the six months ended September 30, 2024, was RMB 3,145 million (USD 448 million)[79] Earnings and Non-GAAP Metrics - Adjusted EBITDA for the three months ended September 30, 2024, was RMB 47,327 million (USD 6,744 million), a 4% decrease compared to RMB 49,237 million in the same period of 2023[46] - Adjusted EBITA for the three months ended September 30, 2024, was RMB 40,561 million (USD 5,780 million), a 5% decrease compared to RMB 42,845 million in the same period of 2023[46] - Non-GAAP net profit for the three months ended September 30, 2024, was RMB 36,518 million (USD 5,204 million), a 9% decrease compared to RMB 40,188 million in the same period of 2023[53] - Adjusted EBITA for the six months ended September 30, 2024, was RMB 85,596 million (USD 12,197 million), compared to RMB 88,216 million in the same period in 2023[78] - Non-GAAP net profit for the three months ended September 30, 2024, was RMB 36,518 million (USD 5,204 million), down from RMB 40,188 million in the same period in 2023[79] - Adjusted EBITDA for the six months ended September 30, 2024, was RMB 98,488 million (USD 14,034 million), compared to RMB 101,289 million in the same period in 2023[78] - Non-GAAP diluted earnings per share for the three months ended September 30, 2024, were RMB 1.88 (USD 0.27), compared to RMB 1.95 in the same period of 2023[80] - Non-GAAP diluted earnings per ADS for the six months ended September 30, 2024, were RMB 31.50 (USD 4.49), compared to RMB 33.00 in the same period of 2023[80] - Adjusted EBITDA, Adjusted EBITA, and non-GAAP net profit are used to identify core business trends and provide insights into operational performance[68] - Free cash flow is considered a liquidity indicator, showing how much operating cash flow is available for strategic investments and acquisitions[68] - Adjusted EBITDA excludes interest income, investment gains, taxes, equity method investment results, and non-cash expenses like stock-based compensation and amortization[70] - Adjusted EBITA excludes similar items as Adjusted EBITDA but focuses more on core operational performance[70] - Non-GAAP net profit excludes non-cash stock-based compensation, intangible asset amortization, and gains/losses from investment disposals[70] - Non-GAAP diluted EPS is calculated by dividing non-GAAP net profit by the weighted average number of diluted shares outstanding[71] - Free cash flow is derived from operating cash flow minus capital expenditures and excludes funds from buyer protection deposits[71] - The company emphasizes that non-GAAP financial metrics should not be considered in isolation or as substitutes for GAAP metrics[69] - Detailed reconciliations between non-GAAP and GAAP financial metrics are provided in the earnings announcement[72] Interest Income and Investment Gains - Interest income and net investment gains for the three months ended September 30, 2024, were RMB 18,607 million (USD 2,652 million), a 262% increase compared to RMB 5,136 million in the same period of 2023[48] - Interest income and investment gains for the three months ending September 30, 2024, were RMB 18,607 million (USD 2,652 million), a significant increase from RMB 5,136 million in the same period in 2023[74] - Interest income and investment gains for the six months ended September 30, 2024, were RMB 17,129 million (USD 2,441 million), compared to RMB 762 million in the same period in 2023[78] Employee and Operational Metrics - The company's total number of employees as of September 30, 2024, was 197,991, compared to 198,162 as of June 30, 2024[61] - The company will hold an earnings call on November 15, 2024, at 7:30 AM ET to discuss financial results[62] Other Segments Performance - All Other segments revenue grew 9% YoY to RMB 52,178 million (USD 7,435 million), mainly due to increased retail revenue from Freshippo and AliHealth[37] China Wholesale Commerce Performance - China wholesale commerce revenue increased 18% YoY to RMB 5,986 million (USD 853 million), driven by higher value-added services for paid members[24]