Alibaba Stock Slides 5% After Revenue Miss, Cloud Spend Hits Free Cash Flow

Alibaba Group Holding BABA reported its fiscal fourth-quarter results on Thursday. The Jack Ma co-founded e-commerce giant reported quarterly revenue growth of 7% year-on-year to $32.58 billion, missing the analyst consensus estimate of $33.08 billion.

It clocked an adjusted earnings per ADS of $1.73, which beat the analyst consensus estimate of $1.48. Adjusted net income rose 22% Y/Y to $4.11 billion.

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Segments

Revenue from Taobao and Tmall Group grew by 9% year over year to $13.97 billion. Revenue from Alibaba International Digital Commerce Group increased by 22% year over year to $4.63 billion, driven by the growth of cross-border businesses.

Local Services Group revenue grew by 10% year over year to $2.22 billion, driven by the order growth of Amap and Ele.me and revenue growth from marketing services.

Cainiao Smart Logistics Network Limited’s revenue decreased 12% year over year to $2.97 billion due to ongoing restructurings with its e-commerce businesses taking on specific logistics platform roles.

Cloud Intelligence Group revenue grew by 18% Y/Y to $4.15 billion.

Digital Media and Entertainment Group rose 12% Y/Y to $765 million.

All other revenue grew by 5% year over year to $7.44 billion, primarily due to the strong performance of the movie and entertainment businesses and the increase in Youku’s advertising revenue.

In the Taobao and Tmall Group, customer management revenue grew 12% due to an improvement in the take rate.

Revenue from China’s commerce retail business grew 8% to $13.17 billion, while direct sales and other revenue declined by 1% to $3.38 billion, primarily attributable to its planned reduction of certain direct sales businesses.

Revenue from China’s commerce wholesale business grew by 17% to $798 million due to the increased revenue from value-added services provided to paying members.

Alibaba International Digital Commerce Group: International commerce retail business revenue grew by 24% to $3.80 billion, primarily driven by the increase in revenue contributed by AliExpress’ Choice and Trendyol. International commerce wholesale business revenue grew by 16% Y/Y to $823 million.

Cloud Intelligence Group: Overall revenue, excluding Alibaba-consolidated subsidiaries, increased by 17%, primarily driven by an even faster public cloud revenue growth, including the increasing adoption of AI-related products.

Cash

As of March 31, 2025, Alibaba held $82.29 billion in cash and equivalents and generated an operating cash flow of $3.79 billion, up 18%.

During the quarter, it generated a free cash flow of $516 million, down 76%, mainly due to the increase in expenditure related to its investments in cloud infrastructure.

Dividend: Alibaba declared a $2.00 per ADS dividend, including a $0.95 one-time payout from asset sales.

Price Action: BABA shares traded lower by 6.06% at $125.92 at the last check on Thursday.

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