BABA - Earnings call transcript Q3 2025 | Alibaba Group Holding Limited

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Operator

Good day, ladies and gentlemen, thank you for standing by. Welcome to Alibaba Group's December Quarter 2024 Results Conference Call. [Operator Instructions]

I would now like to turn the call over to Lydia Lu, Head of Investor Relations of Alibaba Group. Please go ahead.

Lydia Liu

everyone. day, Good Group's Alibaba XXXX Conference Earnings Welcome December Call. to Quarter Alibaba Juha, With Jianfeng, Chief of Chairman; Executive are Chief Business Officer; Officer Officer; Wu, Financial Eddie us Group. Chief Toby Executive e-commerce Su, is Corp our call section website. also the from This IR webcast of being of today. call website the replay be available A our on will later

cover quickly me let safe harbor. Now the

could subject our today's in cause to results. forward-looking today. statements, that and contain usual, would refer safe we may results financial which uncertainties, like As and expected those actual statements release risks to differ provided statements the to from materially to business harbor appear contained about press discussions presentation Please in our that and forward-looking statements. remind are everyone investor that the prospects particularly

use certain call that financial this on non-GAAP we that measures basis. on a note expressed are Please

of mentioned and our growth non-GAAP Our last metrics stated earnings reconciliations call the year. growth same release. quarter versus can in rate Unless press GAAP GAAP otherwise stated, refers to during be all found year-over-year to results this of measures

call will that, the to Eddie. With turn now I over

Yongming Wu

Hello, call. to quarter's this everyone. Welcome earnings

our AI X Over businesses AI-driven strategy of off-line accelerating profit-generating capabilities. growth our year, largely now the user of also our strong completed first businesses transformation, Group, the focused possess assets. a divestments on our e-commerce businesses we past and year After have demonstrated have pursued + business Across and fundamentals of core Cloud. core our momentum. and Alibaba We've

product the XX% triple-digit product quarter revenue, Alibaba quarter. maintaining our year-over-year AI-related plus industry-leading cloud integrated leveraging cloud consecutive Overall AI strategy revenue growth quarter, excluding AI our This business grew with continued for year-over-year to in our sixth consolidated subsidiaries this pursue we portfolio.

Cloud With the technology for AI of industries, has Alibaba across rapid demand surged. products customer adoption

recognized QX benchmarks. industry-leading recently foundation Looking Group multiple growth continue performance has model, which achieved ahead, our launched to accelerate. Cloud AI of MAX, across X.X will revenue We Intelligence flagship

growing of been a developers XX,XXX and over QX platform, continued release built Alibaba will In in derivative e-commerce, comprehensive reasoning QX-based new saw have VIP families. invest popular end Tabou As in deep group the MAX. new X.X maintained QX have developers growth [indiscernible] among and consumers user CMR XX Over Tmall with on and through companies the the growth during in to enhancements. year-over-year. monetization and orders APIs across model making models user members, solid both we X% globally, as strong and most developed We quarter. Bylen progress Cloud's core our soon model double major consumer of QX accessed January, the experience XXX,XXX planned,

same At to business strengthen platform's Taobao and time, the more environment, quality Tmall sustainable our measures development. higher that fostering operating continued merchant-friendly and improve

with this growth improvement efficiency. maintained e-commerce strong in cross-border by international business businesses operating Our continued driven quarter,

of During AIDC while on efficiency. on first operating next its With the quarter choices achieve expect investment we to the improving increased quarter, we economics sequential focusing basis, in a profitability year. key fiscal unit in markets

profitability this achieved platform to quarter. Amap improve Internet operating continued other Our efficiency, businesses

to Alibaba's computing; cloud road AI X third, ahead, We'll ever. and categories: platform Looking and business are direction Internet domestic second, plus international continue focus strategic businesses. than e-commerce; clearer and map First, on

strategy focused We are for confident Alibaba growth that sustained Group. our will drive solid

landscape, AI industry years. the broader our profound as part following Today, with we in In areas scale driving advancements over transformation. the X business are investments AI technology up alignment next will Alibaba strategy Group's X of

computing. presents The AI cloud and demand infrastructure. infrastructure era AI a for for clear massive and First,

We will aggressively in invest AI infrastructure.

spent exceed over years we decade. X have cloud over Our what AI planned is investment infrastructure to in past and next the the set

applications. to transforming Second, industry native are models foundation AI foundation AI AI models productivity. pivotal and

technological leadership the our investment R&D increase applications. development to AI native of in foundation and We substantially drive will AI maintain models

Third, other to transforming e-commerce platform enhance opportunities value user AI businesses. presents across and existing our businesses our Internet with technology powerful AI.

new investment era. across increase in in capturing AI will the opportunities and R&D AI We growth application deeply and computing AI businesses, our power integrate

Looking e-commerce and the excited being technology our on AI new we're by cycle. by focused in plus confident strategy and ahead, this unlocked opportunities cloud business

Toby Xu

The GMV increasing driven by of of businesses. upswing saw Thank adoption good strong impact CMR On improved growth full you, to accelerated fee outcome businesses, we and Eddie. Taiwan which that software Transat. the to in financial online the of our making a shows past quarter are our and core This monetization. growth growth, reignite year-over-year, quarter the progress Tmall X% very in results reflected we service significant in

Our to the public growth overall continues Alibaba revenue fueled subsidiaries XX% accelerating cloud robust growth. by cloud faster and with grew excluding businesses, revenue over to exhibit even from XX% business consolidated momentum revenue

and momentum with for commitment Additionally, achievements AI reinforce cloud and in growth leadership triple-digit consecutive sustaining the These our product revenue sectors. AI innovation highlight our remains robust our AI-related quarter. the to sixth

This momentum in and festivals quarter, overseas users. acquire to growth primarily strong region invest the business quarter-over-quarter selected by Gulf in investments AIDC its cross-border performance. maintained to during the driven AIDC rapid continue shopping increased European markets

goal positive made we good achieving Tmall Group profitability. the other of improved with EBITDA growth we of our growth operating discipline businesses, While we efficiency enhanced and sustainable in the efficiency, progress maintained core Meanwhile, in our growing business with financial businesses pre achieving Tabor

time breakeven This to next X at the the quarter, to profitability majority profitability within loss-making begin Amap for years. contribute achieved and businesses gradually X scale achieve of will the while first

maturities extending buybacks have We actively assets, strategic balance our divestments and managing sheet through effectively rates. been our share debt attractive at noncore of

Art into our our time up moves of X.X billion Sun we all of businesses. USD in to dispose During and for and streamline the to entered operations for focus billion. interest X to in maximum strategic on These a core our shift agreements USD quarter, reflect

have and obtained approval Intime's with respect merger Sun Recently, PRC antitrust filing. to we control the Art

efficiency quarter. improve transactions March operating reflected will be in will agility. We major these our the expect our enhance financial impacts and

a of this of in fiscal shares reparse net reduction billion in USD or over we in had of half X.X first XX purchased net USD X% X count, we months. X.X% share year, quarter, total we reduction billion the share last achieved a the count with approximately combined December For

In billion we of also RMB financing our denominated RMB due which of strategically through a bond completed November significantly USD leverage was costs. notes to to currency a approximately attractive XX X.XX lower billion raising overall the combination CNH billion, issuance X USD XXXX, notes denominated pricing and USD notes structured

revenue an efficiency, the partly primarily increase to in XX.X by RMB increase improved attributable the basis, total On EBITDA X% growth and in RMB offset investments e-commerce operating businesses. consolidated increased billion, was to billion consolidation adjusted XXX.X Consolidated our X%. of revenue

on incentive a the our the growth Excluding basis effect been of would last EBITDA of plan, quarter long-term same year. increase to compared an like-for-like adjusted cash have X%

Our non-GAAP net was income billion, RMB XX.X increase of an X%.

XX.X XXX% share increase net primarily the due billion, operations, income income RMB investees. of equity equity an to GAAP method results our was increase mark-to-market from increase in from and of in changes of Our investments

mainly investments increase in cash RMB XX% XX.X in an flow this increase to expenditure flow quarter our to in decrease to the decreased flow billion. Operating of billion, The was cash XX attributed cash XX%. this RMB infrastructure. was free related cloud Free quarter

net strong sufficient cash brings The to us cloud cash maintain infrastructure AI substantial As cash AI of our and continue presented confidence innovations. billion a and USD increase resources the XX.X flow to XXX.X operating by investments RMB XXXX, and capitalize potential position position or the we of net strong to December healthy XX, in the latest billion. growth

X%. invest quarter enhance the increasing the Group. These take and led at from let's by primarily increase Tmall experience. in efforts of outcome and growth. bases starting online Revenue We software results, and and segment strong grow by XXX.X Taobao driven strong consumers Tmall user of in full and increased Transat. continue of the look in reflected with impact strategic to to This Now X% initiatives management growth efforts new the of RMB our Customer growth rate. order adoption improvement revenue and Group user was increased to billion, fee an GMV the and Taobao service to

RMB VIP continue number this by balance the reaching businesses. XX.X scale offset adjusted Group due service million to in EBITDA to in a Tmall and X% RMB increase quarter, to quarter, Taobao strong increased on program. billion, of of grow profitability to of primarily continue increase by the this the cross-border the solid experience. with members partly performance to management customer increasing Revenue During in up this XX.X user primarily and from grew the by cohort will ADA we investment profitability XX% and revenue $XX driven rapidly, billion AIDC basis, from

a international in AliExpress commerce driven revenue to by retail to XX% increase and an of RMB related quarter RMB RMB Revenue revenue Revenue business last from RMB in Trendyol. billion, value-added our commerce the from X.X by international by increased by increased EBITDA by services. X.X contributed primarily increase XX% same of billion, XX.X billion, wholesale generated AIDC's of primarily was the cross-border business loss to loss compared a in due year. to billion X adjusted

shopping investment continued region markets users. to and selected quarter-over-quarter increased acquire AIDC overseas during festivals in European in the Gulf investments the

business Choice of basis. a improved the UE sequential the However, on AE

enhance to growth select by markets. operating continue high-quality each will investments we forward, and strategic within drive Moving in efficiencies business

public adjusted by by customer Revenue Intelligence cloud Alibaba by mainly growth efficiency, increased to subsidiaries offset including revenue increased Group products. to overall by technology. Cloud a and due the public excluding partly higher-margin and increasing operating XX%, revenue, mix investments shift growth consolidated driven XX% grew from of the and XX%, AI-related primarily products products, Cloud double-digit product EBITDA in improving cloud in

continue in in customer of We to AI invest AI opportunities era. the will and capture to innovation, infrastructure technology in anticipation particularly growth growth

There platform its adjusted to to smart X% end-to-end own decreased well make e-commerce as available e-commerce certain focus restructuring on Tania logistics businesses businesses capabilities EBITDA from global by logistics ongoing role. network Revenue XX%. and our building taking an parties. third on and China logistic by decreased our with will as its is continue

its unit to to operating medium by growth both well XX adjusted Amap narrowed EBITDA growth service improved local narrow. from its grew the by as of for billion, continued services. digital revenue Revenue loss Group marketing as from driven and while significantly Urlama Entertainment to efficiency scale and XX% due EBITDA adjusted while and X% order as Revenue RMB loss RMB economics grew X.X group billion, to as increased.

all Health increased in a billion, other was XX.X RMB while to businesses, including increase to X.X Freshippo, from and segments adjusted revenue from by mainly retail due loss XX% of RMB Revenue the billion. EBITDA Alibaba

are In this and we enhancing businesses. in closing, quarter, strides e-commerce our the cloud during competitiveness of making significant

path efficiency we are clear Additionally, on of focusing to segments improving our establish loss-making profitability. to the a

sheet share our significant noncore effectively we with to quarter, return shareholder debt sales, this addition, extending In attractive asset maturities at continue and and our optimize rates. balance buybacks

continue significant to will we execute our mentioned, AI make era. As seize the opportunities strategy to presented Eddie by and investments

coupled end unique you. ahead, Looking growth. position, our business confidence prepared remarks. That's give positioning, of our strong financial the Thank us with to full our

up for We Q&A. can open

Lydia Liu

Thanks, Toby. the translator for session. Q&A original Hi, are call, is everyone, interpretation Please prevail. consecutive convenience to Chinese any of that translation language ask questions only. or the today's in discrepancy, In will purpose English. case note the our provide A management for in for third-party welcome will the you statement

the you [Foreign unable week call the within transcript translation, meeting. filing this hear If available Language] the are on end be our after will to Chinese website of a X of

conference please Q&A start you. Operator, at connect now. a session. Please Thank line speaker

Operator

Your Alicia [Operator comes ahead. question Citigroup. Yap Please from first Instructions] with go

Alicis a Yap

cloud results. AI CapEx. solid My also is question the to related on and Congratulations the

but cloud months well in China to of So leading with era our China. capture in AI transformation and and of adoptions models, strong is other also service the foundation in the positioned infrastructure outside coming possible these

some this few on noted as We margins will into in to more years XX from last be years. And can doubled management share your growth remarks the -- maybe to spend CapEx X past quarter that that the billion. terms next the cloud in of translate expected the upside financial also than almost insight and investment next trend expected it in noted prepared $XX the quarter CapEx also So the the management will in revenue how cloud quarters? the

a comment years? profitability how clarify trend? crystallize you us have management the the CapEx us overall you the can impact that next So spend quarters? for spend budget also, in the for and X next share actually the will amount of help And can few the And do

Yongming Wu

continue those [Interpreted] questions. questions ways in the so before aggressively they larger and get AI as AI we begin to progressively few as by have our as come that And overall will the been well the see we're of developments into perhaps out. there. monetize There and and views a could that AI opportunities in were we on sector around why with you each quite I I investing sharing

market. Alibaba is have we of we in all, in well space, several particular, important AI think positioned in First advantages. that extremely Asia where the the very

We are cloud provider region in globally. cloud and a provider the #X the

We leading technology. have leading models,

And decades. AI strategy the application have We models even view ecosystem. because explain comes proprietary have ecosystem. once across an we that for group's transformation industry the around But scenarios longer-term well this AI as only AI of opportunity open also a a to taking is thriving about multitude every several requires our for really kind of as

Why it's scenarios we the content and have as a pushing today see that around comes to Well, we all strategy, to precisely of first pursuit our opportunities. to on more is AI models AGI and search to is want extend AGI. The because and boundaries, the our intelligence. extension primary goal of objective. those and more forth, creation, continue result develop it Alibaba's boundaries of is boundaries AI when of visible aim? to aim create So the to that We that so keep of so primary arisen the foremost application those pursue and ongoing out

intelligence So our in the out and as the we objective efforts. of pursuit AGI of of continued see pushing boundaries the key the

of intelligence or capabilities. can is business work salaries, achieved, have mental GDP value including replace pardon the pursuit Well, the AGI both XX% human immense could manpower achieve XX% can that that when AGI around of the AGI been of for contribute potentially, -- studies or Secondly, physical intellectual me, global indicate it is artificial is standard and that there labor.

can global impact XX% achieved, the restructuring industry AGI of a and if have could could influence replace terms even of in significant around tremendous or be on So then that a GDP. have world

see AI. the most future. we the We and integration to of will as deepen this continue kind Second, of the important cloud in And infrastructure.

an on We our to and continue cloud build will in business across our own AI integrated fashion applications.

distribute globally a output basis data developers tokens cloud we be really are about talking distributed the only highest connect because computing network network cloud can we the and XX% When of of rapid cloud and about worldwide by the intelligence, of talk the can tokens output through by to efficient with we and models. on generate that our those in deployed will efficiency, that And generated level the and centers. most we're tokens on future, the think

our Thirdly, scenarios we integration attitude open the maintain to value an with deep all create to respect of AI of own across businesses. our

We expect the integration achieve will efficiency. higher AI of and further across our XB we that offerings, with XC

user for spend increase users. and user value will more We create our time

did years. X more behind over invest So we as determination, over that's our last the than years in thinking and cloud referenced, precisely to the next you in AI XX aggregate the

or be overall you basis level with the The CapEx basis a to equal be the years, less there but is chains laid part get provide year-by-year do given I up. for for it for had takes IDCs I've set needed more time year fluctuation could well that within X of these our coming out X years. a on will on supply question the your would each to quarter-by-quarter basis, on what's that What for as forward. to expectation as annual say CapEx going across quarter-by-quarter second of a the

it be the years. next expect to would we overall, X But even over relatively

say level X-year had concentrated we'll of in building terms of of rapidly. see and potential take-up taken this investments part I an that is demand infrastructure on other AI-related There's our single for period external infrastructure. have this cloud of that be hardware And and CapEx impact the the of to impact be The being our out profitability. will will expectation depreciation. course, do very in with part your the in definitely and we of the making on and demand which both most next internal period huge our of up behind highest plans But likely question customers. would there, the huge

Lydia Liu

please. question, Next

Operator

JPMorgan. Alex from with comes question Yao next Your

Alex Yao

My Congrats strong question to cloud. also related very on a is AI quarter.

latest and big models, So And has from families of introduction application entire And power commodity. the the model a observation, itself cost of based potential to see the statement? disagree because what the model affordable charge, monetization the first -- to of down is AI language in efficiency most moved is model for model all, the extent DeepSeek's you industry. my a large Alibaba high X language at so with not of native do DeepSeek and area free of with to of value the do chain in or language on consumption high-quality the large DeepSeek's is high-quality help parts ecosystem model And compute this lastly, brought agree has high you compute secondly, or outside ecosystem. power within where Alibaba large cost terms layer

Yongming Wu

really [Interpreted] some are good questions. Those

when still early We're initial artificial although advancement we're the development. I in think intelligence days about technology, the talking of we're stages very developing still in rapidly. it's of

So anybody I monetized in models business necessarily and be future to these future are will the think the models which today. not clear ways

be get out more and get them, but smarter, intelligence opportunities be to today. the that the and there'll boundaries monetize As apparent as ways in more to smarter may models not us of pushed

able and different talking engineers sufficiently that supplant I'm become intelligent scientists expertise development. of future really kind will stage to and be a that models a to about where be of the

today, current models level differences is of across obvious. becoming vendors The narrowing. point that second The is differentiation if are at look from the different you models less

closed cloud or offerings network cloud differentiation for be are of or is will different the all to between models beneficial our these open But a becoming In computing of be source closed fact, it's open because models hosted what open all and development these network. models of they need closed, also computing the apparent models. less source on

clearest what to is So me pathway cloud the these definitely ask computing if monetization clouds. offerings of operation host our the you support and today, that exist it's to

intelligence AI, that So if I the network new that if like could computing cloud artificial is power is like our in electricity. offer analogy, grid carries an electricity then this era

they're faster other ecosystem. you tell to to potential. me the think Alibaba the highest quite evolving AI are with do it's becoming your for the actually faster areas the and that more -- and the definitively and have In of what we question greatest that within powerful potential more are applications difficult Models which the means had

I think that all applications looking internally are at interesting opportunities. potentially could we But huge potential. have some certainly very

and will First, lifestyle We're the internal be as development lot Taobao app of in doing a many portal projects for soon. for of terms a these consumption. launched of and

You'll they these serve within higher Taobao to drive when see AI also deployed. are efficiency. them But engagement consumer transaction enhancements and will increase

will contribute value applications Other create to kinds purchase increased decision-making for users. related user of AI-empowered time and spend and

So expect of beyond we features of value. kinds create shopping, introduction more on can Taobao AI a to further

XC have offerings. our also We AI

[indiscernible]. As you Tony know, Quark and

So AI search And improve number and productivity, China. largest users of overall to there continue to be the search, and has which AI Quark is is deployed creation in an product, efficiency. will being deployed

the local used have as lifestyle currently user app. And also It's that side AI now the as it. -- X deploying navigation true AI, increase Ding our the deploying deeply same But as into to portal in the time we We're a experience. It As Talk will is Amap, China. you AI more integrate and [indiscernible] app well. there where DAUs enterprise and a asset services, XXX spent we're million well. we very has mostly extend know, of to important redefine for collaboration is as important on the most also

Lydia Liu

Next question, please.

Operator

Kenneth Your UBS. question Fong with comes next from

Kenneth Fong

a about Congrats on e-commerce -- side. I the have results. strong on the question

So accelerating we see and for revenue have strong AIDC well that both been as for very [indiscernible]. as

as for with share the And and margin as the stabilized. see financially, changed key us we initiatives can So AIDC. has well management what has TDG for also TPG ahead

the about think trend we should ahead. how So

for And year. profitability next for target AIDC, we

term, longer it profitable is term, international than shorter So driving domestic we key And given being more driver for expect the one, less profitability? should the what are business competitive.

Yongming Wu

few [Interpreted] a there with start Why are there. Again, quite don't questions e-commerce. I domestic

has So by to in enhance further strategy make the to higher user we to experience, the that see user the been achieve and the at year, experience ahead we've potential same stickiness. coming the achieve the domestic levels innovation around of in pursuing to And investing e-commerce growth users optimization user further been business looking to time.

lot things, a those recently, as the including, things invest to the continue merchants user to As investment. to fees, experience other operating require as continue monetization you've said, but in we've well payment enhancing environment increased will we among our charging done and for will processing enhancing drive

efficiency. at and overall, stabilizing we're the enhancing looking while merchant experience So market share user optimizing operations

profitability. significant profitability, a And know, we've that of said over e-commerce our business, of next business. But in optimize increase to a stable to lots in achieving can including scale. trend models, said, amalgamation you model very you well cross-border have lot local at we overall, an BXC the in see terms operate. really In few to business we in significant a few expect and the done different increased years quarters, the as BXB as expect significantly. This business economics we Secondly, see our unit international towards of as we international next as business working our platforms is as profitability

increasing In it some profitability. to where on are countries, we also local makes that collaborating our to so. with sense beneficial platforms. is working And do

the at long at to clear. asked particular business. be e-commerce pathway can judge e-commerce point. in our think You I I can is in that business What the the is international business profitable don't the point in something this than that's international profitability more if term this time, could say domestic I

Toby Xu

VIP in been in Fan our the I quarter, is been as the invest has user regarding as This strategy quarters as for clearly share. take continue. That's will achieving stable well group, user of Toby. TTG very experience think stated new the priority for investment this the enhancing question core acquiring healthy, those indeed I'll [Interpreted] on to margin market Jiang XX investments and in in in several and users investing past has

which integrated the also actively also software methods is more levels ways product, lot We've service QT intelligent driving engaging important as you've increase well we'll exploring for done while making Also, well, new to merchants with these we've as an to we're And marketing And a John seen, while of users. invest in revenues. which increase to on with ways attention fee, payment with Two, is those higher means of as new also investments, as monetization environment of so to those same monetization. our seeking platform. in continue areas business a course, the of while the optimizing paying

balance and experience been, between So margin to do in remain continue a and as new acquiring always and an have in users. we'll invest we is we investment expenditure user stage enhancing and revenue

Lydia Liu

please. question, Next

Operator

with Your next question comes from Ron Goldman Keung Sachs.

Ronald Keung

Evan, Tobi and Media.

mentioned on further quarters as growth you at for questions, revenue the seen we've X AI now. triple-digit AI the So

the substantial of we given AI. size some margin gap global kind should a of double-digit is business So of for players. want more at how the quantify we cloud know Are of reason to for that? very kind historical The significant margins I is the that versus implications here cloud cloud reaching mark

versus how global our longer now then to the in as growth the the importantly, increasingly peers more and we public about and training should cloud influence, then for the So us think from mix term? to cloud margin shifts outlook cloud

Yongming Wu

questions. Indeed, correct. Thanks for absolutely you're [Interpreted] those

growth AI the growth, sixth related demand products revenues consecutive quarter. and Our X-digit grow. for XXX% over And to for continues achieved AI-related customer

In Year seen inference. much from fact, an the in our that to expectation. than higher out Chinese explosion for in be onward Spring particular is demand what Festival, growth original we've New turning And is

fact, now around XX% that to XX% inference. the we're seeing new demand In of for is

services. and rapid and certainly So sectors we across that our will to AI we wider grow in demand, base industry expand expect all of in a of contribute customer will range levels our coverage expansion higher that margin with this of

those making amortize committed highest we're the period. you impact However, in the as have investments an I margin. them to the historical said certainly that years, ever and over And take coming CapEx earlier, coming will if in on X-year investments

expect in I that the kind from different and see the China final what a will here, dynamics margin China market the point would different that given you'll you'll And competition see of fierce internationally. be somewhat in

thing characterized by business effects effects I are engaging hardware would that at is The building and that's both strong investments, CapEx. out scale and cloud particularly effects we're in network the capital stage say is strong other large our a with scale this as important

So the of achieve to able we and greater the that better point is customers, be build-out. more acquire we'll as optimize cost scale this

Lydia Liu

Next question, please.

Operator

Your next Securities. question Liao comes from Yuan with Citic

Yuan Liao

[Interpreted] all making the the strong with around do Congratulations has question progress returns. you're results on to and shareholder My AI.

that will deployed of see wondering USD the tell we how think make I be I'm there. me, buybacks. share if you given that intend AI around all billion. and can of X.XX still pardon us you the investment USD to XX.X billion progress dry powder the for

Yongming Wu

fiscal X.X% over half the of X.X net in billion X% the [Interpreted] year, conducted count. USD approximately December net a billion as achieving in Well, know, count share XX And share the we in during of repurchased we buybacks, USD a last the you first quarter, X achieving months. reduction reduction

you as see, can So already repurchases. we've considerable very progress these share made with

current repurchase. As repurchase programs, for pace an is share practice months, consider accelerated the share price course, execute share program. of And we we of engaging as you X that's buyback companies in in will first the common saw our market why share

which was is billion quarter, USD only in the and and in used raised we XX, the debt X buybacks, example, share undervalued. was at time entirety because USD extremely the our of financing an As share June in for that the our price view, proceeds

of shareholder return as so, to returns buybacks as enhance well, have of and strong continue providing The at the shareholder management optimizing the investment been combination we'll return. up initiatives, shareholder in aim you do management to committee elevate a dividends capital so a through will areas. set we allocation high-growth, has course, as to precisely purpose of As share to level and capital high-potential we to of continue Board for know, committee

forward, our the share will given return. to continue the to shareholder and with optimally of Going effectively Directors to execute Board by and with and deploy continue eye the share in we'll to guidance accordance cash allocation repurchases an price. enhance we on And us

Lydia Liu

please. question, Next

Operator

Your Yu with comes Morgan from Stanley. Gary question next

Gary Yu

Congratulations strong cloud. questions, of both on to I and have results. related a X AI set

how The besides first how AI when the we tap global we appreciate infrastructure, to important and think of software XX% or application should cloud, Alibaba's the But about this is comment about management potentially strategy X is think is cloud represented into sizable which by GDP representing opportunity, layer? we I infrastructure. potential about the monetize

And enterprise kind about consumption adoption part, we and management local because consumer-facing about the including more previous comment could side the comment understand services? of

And second to CapEx. related is question my

comment in will order as any And to from event our we think cycle X think next and continue as domestic So import between about Alibaba U.S., how in about contingent about plan restriction spent past chips. plans management mix chips half U.S. how in years year to of on be further the the the being think the allocate much well about decade. we should investment? investment? the the chips from spending with export should we should how the investment How How specifically, on

Yongming Wu

thank Well, questions. those [Interpreted] you for

When As Intelligence a host to we to already there opportunities side, the capture. some the we Cloud XC for mentioned. side, Alibaba very are clear said, AI different on the of which comes of opportunities XB I've application it definitely see for

agents AI by forward SaaS as driven. assist a general future, become X think of network a and of going more call AI enterprises services, including systems the important multiple remark, enterprise In to the to will a on provide employed will become to words, more internal collaborate software lot and in in another other agent I like even decision-making. more the

there supporting Along with that, layer, a opportunities upgrade SaaS will to also of the the also the but just pass software, be layer. not lot underlying

product. example, flagship collaboration I Ding Another Talk, think, which really is good enterprise our is

that and functionality a CRM in. I language think through type with forward like more going will become of lot AI, And natural interaction. achieved today's databases a ERP systems feed will in be

handled integration natural agents many for through Ding Ding of be language all of into and Talk. meetings the Talk. opportunities enterprise again, on So all And can kinds there decision-making are

important Another the agents in huge data is kinds of amounts in-house leverage to need companies of those internally efficiency proprietary to own processes that processes. of thing order of and to their lot a proprietary enhance note and AI have they'll

I able overall, is all AI reshape and this software So applications, corporate of be will opportunity. and a -- think to huge corporate empower kinds

that would you part require to in to detailed you CapEx of of regarding breakdown all breakdown percentage the other a giving cost a into order of what what your of the to On really equipment CapEx go will in IDCs. the area give as question our different

kind detail all liberty don't into that designed our that with you. to with I different you What compatible cloud of I'm very get we've way range the at is deliberately of So be ships. think of can kinds to a really I tell whole is

I us. to that be So mean plan. not no will changes certainly investment implement we'll what matter the future, able kind policy affect in our of be forthcoming may

Lydia Liu

time will take question. limit, now to Due the we last

Operator

from Nomura. Your next question Shi Jialong comes with

Jialong Shi

divestment My Jon first physical Art. plans future following Illuma. you any potential of divestment time for successful and is I'm Sun have X questions. your including and fresh assets, [Interpreted] apple have assets if retail of wondering other I in

model case just My will the be Tony, the that's But the from day to future, market profits as or AI to model to to way the with continue of come big seems of to wondering seems the second Chinese monetization the a will and I'm when revenue there Eddie revenue large be in X cloud, being itself, a there's in a X question, -- homogeneous compute. take as lot it in any uptake for that up And think the associated model market there's is there rather there in driven the sense if that, lack coming growth a models the might said, monetization the for different use compute is any a future addition market from across back pathway generate you that be demand result models. just Do in cloud, that differentiation not share. AI. of in of that the

Toby Xu

I'll over the first of to I'll and part Eddie. then This question, [Interpreted] Toby. the is hand take

focusing December our in as time, know, strategy has and strictly have Sun and So the we reviews. we in our on core sale in of businesses. you implementing of full been And quarter, our and monopoly we as the announced exiting have passed been businesses completed noncore Art already

we June So March quarter or expect in either quarter. to complete those the transactions the in

forth the which a and looking into think minority-owned example better ones. Alibaba of to for tap will as good very have assets, Freshippo, a in the is expansion. be value in is an looking and we'll And you it's and their and of as mentioned see as the It's in model We been noncore profitability, we be business retail. -- of other online the assets reflected And at we business go see our core announcements ways that. focusing in offline excellent to integrates innovative coming for say, which that's look really exiting, achieved we forward. on invested example future, growth, businesses, very that value our business to and continue I we're Freshippo opportunities you'll good we'll will exit better to good Group. respect assets, nonstrategic that achieved of very continue be But I good that valuation an to

better Alibaba would valuation enhance other open the could the in So given or take Freshippo for in a value sell reflected attitude certainly the strategic in an any have Freshippo, of investor its to value but being plan we Group. have approaches result solar a and of success, particular, to introducing example, no, we that don't and

further going So something needs this is that forward. exploration

Yongming Wu

[Interpreted] This is Eddie.

of part the take question. me other that Let

we're driven the huge cloud is yes, demand So products. growth being growth customer the seeing by largely a robust in revenue that for AI

Our product, that of provided but [indiscernible] it necessarily charge. mean model open is is does an not free source that

model In for platform. fact, via to Lean on by do API charge the the access we

not the low. as way possible But charge their of the relatively become as the Of certainly are revenues that that create we models. more we it's use sophisticated, -- for course, capabilities could we're more powerful the models improve, that more become

open their as develop a that do foundation using own is those which because it's, I But Alibaba are it that means developers model own they therefore, way a on model, to QX lot an Cloud source only also that applications. their deploy natural will on is most should say that's efficient vertical applications and to models And of it. the models, those

API. for would a a are customers of excellent to QX cross-sell that our accessing through also say There example opportunities to of lot the when us other offerings. model I them cross-selling cloud are opportunity. Thirdly, really of It's our

QX It's in although to drive may huge overall overall So cloud revenue. important a our offering help of will part and not not revenues. very, drive and is cloud that of very itself driving

Finally, to very AI This had is And in now do with and on the of same development which last the your rapidly. at question, market time time, early in for China. future are developing a things period iterating where AI. right landscape of the days it's

is tell said, we're today end look gap can different you What don't seeing will trends like. models just the is I I the think between as game So I it's to judge narrowing. the that what today, foundation possible

to you see I going post expect forward, of around that lot training. demand a think can

cases models as training models we reasoning that of around demand a potential like training. for to different DeepSeek, thinking a well there's AI, huge data the of will adapt as releasing that can the post And sets. sectors, use So models, adapt those reasoning lot customize to private of think be them kind shortly, post market to of I open them be model to the that different will

whole vertical small. all of referenced cloud. I've will value for be need these lots all the different I think to range models, the there's on of companies, models of large create to also hosted a opportunity and And specialized models,

excited that's we why of and prosperous development the cloud confident are ecosystem. an So very open in

Lydia Liu

Eddie. wraps of We much the us Thank speaking That with Thank Q&A . up today's joining earnings Thanks, today. you. soon. you very session call. to you look for forward

Operator

our participating. conclude for you Thank That does conference for today.

You may now disconnect.

[Portions that were the by of interpreter present on an [Interpreted] this marked call.] live spoken are transcript

Alibaba Group Holding Limited (BABA) 20 Feb 252025 Q3 Earnings call transcript