Wedoany.com Report-Nov. 26, Alibaba Group reported second-quarter revenue of 247.80 billion yuan ($35 billion) on Tuesday, surpassing analysts' estimates of 242.65 billion yuan according to LSEG data. Growth was driven by increased user engagement on its shopping platforms through enhanced one-hour delivery services and continued strong performance in its cloud computing division.

U.S.-listed shares of the company rose 2% at the open amid active early trading.

Adjusted earnings per American Depository Share came in at 4.36 yuan, below the consensus forecast of 5.49 yuan. Net profit declined 53% year-on-year to 20.61 billion yuan, primarily reflecting ongoing investments, yet still exceeded market expectations.

During an earnings call, Alibaba Group CEO Eddie Wu highlighted sustained commitment to artificial intelligence development. "We will be investing in AI infrastructure aggressively, the 380 billion yuan investment we previously mentioned might be on the small side given the customer demand," Wu told analysts.

The company continues to allocate significant resources to both consumer-focused instant retail services and AI infrastructure. Investments in rapid delivery capabilities have contributed to higher order volumes, while unit economics for the instant retail segment have improved markedly, with cost per order dropping by half since summer.

Alibaba noted that its instant retail operations are on track to contribute an additional 1 trillion yuan in annualised gross merchandise value over the next three years. Analysts view these expenditures as building long-term competitive strengths despite short-term pressure on margins.

"We believe these investments (in consumption and AI) will build long-term competitive advantages despite near-term margin pressures," said CFRA analyst Angelo Zino.

The recently concluded Singles' Day shopping period, which ran from early October to November 11, generated total platform sales of 1.70 trillion yuan across major operators, according to Syntun data, marking an increase from the previous year.

In artificial intelligence, Alibaba has accelerated consumer-oriented initiatives. Its newly released mobile app powered by the latest Qwen large language model achieved over 10 million downloads in its first week, reflecting growing adoption of its consumer AI offerings.

With a diversified business portfolio and substantial financial resources, Alibaba remains positioned to support continued expansion in both e-commerce services and advanced technology sectors while navigating competitive dynamics in the domestic market. The company’s international and cloud divisions also maintained robust growth trajectories during the quarter.