Zhong Guo Zheng Quan Bao·2025-11-25 15:34Core Insights - Alibaba reported a revenue of 247.795 billion yuan for Q2 of FY2026, marking a 5% year-on-year increase, and a 15% increase when excluding the impact of divested businesses [1] - The company experienced a significant decline in profits due to investments in instant retail, user experience, and technology, with operating profit down 85% to 5.365 billion yuan and net profit down 53% to 20.612 billion yuan [1] - CEO Wu Yongming stated that an AI bubble is unlikely in the next three years, with demand for AI resources expected to exceed supply [1] Financial Performance - Operating profit decreased to 5.365 billion yuan, a drop of 85% year-on-year [1] - Adjusted EBITA fell 78% to 9.073 billion yuan [1] - Free cash flow shifted from a net inflow of 13.735 billion yuan in the same quarter last year to a net outflow of 21.84 billion yuan [1] Strategic Investments - Alibaba plans to invest 380 billion yuan over the next three years in AI and cloud infrastructure, with 120 billion yuan already spent in the past four quarters [2] - The company is focusing on building AI technology and infrastructure platforms, as well as integrating life services with e-commerce [2] - CFO Xu Hong stated that the core business revenue remains strong, with AI revenue from external commercialization increasing [2] Cloud Business Growth - Alibaba Cloud's revenue reached 39.824 billion yuan, a 34% year-on-year increase, with AI-related product revenue growing for nine consecutive quarters [3] - The company holds a 35.8% market share in China's AI cloud market, surpassing the combined share of its next three competitors [3] - Alibaba Cloud is expanding its international operations, with new data centers announced in Brazil, France, and the Netherlands [3] E-commerce Performance - The Chinese e-commerce group's revenue was 132.578 billion yuan, a 16% year-on-year increase, with the e-commerce business growing 9% to 102.933 billion yuan [6] - Instant retail revenue surged 60% to 22.906 billion yuan, driven by increased order volume from Taobao Flash Purchase [6] - The adjusted EBITA for the e-commerce group fell 76% to 10.497 billion yuan due to significant investments in instant retail [6] Instant Retail Developments - Taobao Flash Purchase has seen a significant improvement in unit economic efficiency, with losses per order halved compared to previous months [7] - The average order value for Taobao Flash Purchase has increased, contributing to overall GMV growth [7] - The company aims to achieve a transaction volume of one trillion yuan through the Flash Purchase platform in three years [7] International Digital Business - The International Digital Commerce Group (AIDC) reported a 10% year-on-year revenue increase to 34.799 billion yuan, with adjusted EBITA turning profitable at 162 million yuan [8] - The improvement in operational efficiency of AliExpress has been a key driver for this growth [8]