BABA(HK:09988) Soochow Securities·2025-02-26 05:23Investment Rating - The report maintains a "Buy" rating for Alibaba-W (09988.HK) [1] Core Insights - The company's revenue growth exceeded expectations, with total revenue reaching RMB 280.1 billion, a year-on-year increase of 8%, surpassing Bloomberg's consensus estimate of RMB 277.37 billion [10][29] - Non-GAAP net profit for the quarter was RMB 51.1 billion, up 7% year-on-year, also exceeding market expectations [10][29] - The report highlights a significant increase in capital expenditure, which rose to RMB 31.7 billion, compared to RMB 17.5 billion in the previous quarter, indicating a focus on meeting customer demand [25][29] Summary by Sections Revenue and Profitability - For FY2025 Q3, Alibaba's revenue from its main business segments showed robust growth, with Taobao and Tmall generating RMB 1361 billion (up 5% YoY), international digital commerce at RMB 378 billion (up 32% YoY), and cloud services at RMB 31.7 billion (up 13% YoY) [10][14][29] - The overall EBITA margin for the company is in a recovery phase, with expectations for continued improvement in profitability [29] Business Segment Performance - Taobao's customer management revenue grew by 9%, driven by an increase in the number of 88VIP members to 49 million, reflecting strong performance during the Double 11 shopping festival [14][29] - The international digital commerce segment saw a 32% increase in revenue, primarily due to strong cross-border business performance [19][29] - The local life business, including Ele.me, reported a 12% revenue increase, with losses narrowing significantly [21][29] - Alibaba Cloud's revenue growth of 13% year-on-year indicates a return to double-digit growth, with AI being emphasized as a core strategic focus [18][29] Financial Forecasts - The report maintains EPS forecasts for FY2025, FY2026, and FY2027 at RMB 8.14, RMB 8.82, and RMB 9.55 respectively, with corresponding Non-GAAP PE ratios of 15.8, 14.6, and 13.5 [29][32]