Zhi Tong Cai Jing·2025-10-10 06:15Core Viewpoint - Morgan Stanley predicts Alibaba's revenue for the quarter ending September will grow by 5% year-on-year, while adjusted profit is expected to decline by 70% to 11 billion RMB [1] Financial Performance - Revenue is forecasted to increase by 5% year-on-year [1] - Adjusted profit is anticipated to drop by 70% to 11 billion RMB [1] - Cloud business revenue growth is expected to accelerate to 30% year-on-year [1] - Customer management revenue growth is projected to remain above 10% year-on-year [1] Investment Insights - The decline in adjusted profit may be driven by aggressive investments in AI and instant retail, which are expected to solidify long-term growth prospects [1] - Alibaba's H-shares target price is adjusted from 240 HKD to 235 HKD, and the US stock target price is revised from 245 USD to 240 USD, maintaining an "overweight" rating [1] Loss Projections - Significant investments in various business segments, including Tongyi Qianwen model, DingTalk, Quark, and Amap, are expected to lead to increased losses outside of e-commerce, cloud, and international business [1] - Anticipated losses for the quarter ending September are projected to reach 5 billion RMB, widening from a loss of 1.4 billion RMB in the previous quarter [1] - Losses in the instant retail segment are expected to expand to 35 billion RMB for the upcoming quarter [1]