China's Alibaba sees revenue surge on back of e-commerce and AI
Net income surged to 48.9 billion yuan (€6.41bn). Alibaba's New York-traded stock was up by more than 12% following the earnings results.
In an earnings call, Alibaba CEO Eddie Wu said that Alibaba plans to 'aggressively invest' in artificial intelligence and cloud computing infrastructure in the coming three years, with upcoming spending expected to exceed what the firm has already invested over the past decade.
'This quarter's results demonstrated substantial progress in our 'user first, AI-driven' strategies and the re-accelerated growth of our core businesses,' Wu said.
AGI seen as key to company's future growth
He said that Alibaba's artificial intelligence strategy was to pursue artificial general intelligence (AGI), which is artificial intelligence that can match or surpass human intelligence and can self-teach.
He added that such an opportunity for industry transformation is something that comes along 'once every several decades' and said that AGI was Alibaba's primary goal.
Alibaba's plan to go big on artificial intelligence comes as rivalry in the AI space heats up between the U.S. and China. Chinese AI firm DeepSeek recently rattled the U.S. AI industry after its AI model appeared to rival those of leading U.S. companies while being trained on cheaper hardware.
The Hangzhou-headquartered firm is one of many technology firms in China who are racing to get ahead in the AI space. In January, it unveiled its latest Qwen AI models that have performed well in benchmark tests, placing Alibaba among the leading companies in China's AI industry.
Alibaba is working with Apple to incorporate its AI technology into Chinese iPhones, the firm said earlier this month.
Alibaba has already implemented AI technology into its cloud products, with its cloud business unit generating 13% revenue growth compared to the same time last year – the fastest pace in about two years.
Its international commerce unit, which includes platforms such as AliExpress and Lazada, saw revenue growth of 32% driven by 'strong performance of cross-border businesses.'
Firm faced crackdown by Chinese authorities in the past
Alibaba was one of several prominent Chinese technology companies which suffered the brunt of a regulatory crackdown on the technology industry in 2020, when authorities scuppered the initial public offering of its financial affiliate Ant Group.
The company was later fined a record $2.8bn (€2.67bn) for violating anti-monopoly laws. Jack Ma, one of Alibaba's cofounders, disappeared from public view and the company's stock price slumped for several years.
But Beijing appears to have shifted gears towards the technology industry as it pursues technology supremacy and self-sufficiency amid deteriorating U.S.-China relations.
Chinese President Xi Jinping recently held a private symposium, meeting with prominent entrepreneurs including Ma.
The meeting, coupled with DeepSeek's AI advancements, were among the factors that sparked renewed interest in the Chinese technology industry, sending technology stocks soaring in recent weeks.
Alibaba's stock price is up by more than 60% this year. Its U.S.-listed shares rose 8.5% in morning trading, to $136.58 (€130.41).
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