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Alibaba Group Announces March Quarter 2026 and Fiscal Year 2026 ResultsMay 13, 2026 5:30 AM
Business Wire Alibaba Group Holding Limited (NYSE: BABA and HKEX: 9988 (HKD Counter) and 89988 (RMB Counter), “Alibaba”, “Alibaba Group” or the “company”) today announced its financial results for the quarter and fiscal year ended March 31, 2026. “Alibaba’s full-stack AI investments have progressed from incubation to commercialization at scale. This quarter, we achieved accelerated breakthroughs across models, cloud infrastructure, and applications,” said Eddie Wu, Chief Executive Officer of Alibaba Group. “Cloud Intelligence Group’s external revenue growth accelerated to 40%, with AI-related products accounting for 30% of this revenue. Our Qwen LLM demonstrated leadership in reasoning and coding while we strengthened our multimodal model portfolio with the launch of video generation and world models. As we see massive potential for agentic AI, we launched multiple enterprise AI agents for office and coding use cases, and we fully integrated e-commerce capabilities into the consumer-facing Qwen app, deepening synergies between AI and our consumer ecosystem.” “Our strategic investments continued to translate into business growth. Cloud Intelligence Group’s revenue continued to accelerate, with AI-related product revenue achieving triple-digit growth for the eleventh consecutive quarter. China e-commerce customer management revenue grew 8% on a like-for-like basis. The unit economics and average order value of quick commerce steadily improved. We are confident in our business outlook and will continue to invest in AI + Cloud to strengthen our competitive advantages,” said Toby Xu, Chief Financial Officer of Alibaba Group. BUSINESS HIGHLIGHTS In the quarter ended March 31, 2026: Revenue was RMB243,380 million (US$35,283 million), an increase of 3% year-over-year. Excluding revenue from the disposed businesses of Sun Art and Intime, revenue on a like-for-like basis would have grown by 11% year-over-year. Customer management revenue increased by 1% year-over-year. Excluding the contra revenue impact from the new business development program, customer management revenue on a like-for-like basis would have grown by 8% year-over-year. Loss from operations was RMB848 million (US$123 million), compared to an income from operations of RMB28,465 million in the same quarter of 2025, primarily due to the decrease in adjusted EBITA. Adjusted EBITA, a non-GAAP measurement, decreased 84% year-over-year to RMB5,102 million (US$740 million), primarily attributable to the investment in technology businesses, quick commerce and user experiences, partly offset by the improved operating results supported by continued growth in customer management service and Cloud business, as well as enhanced operating efficiencies across various businesses. Net income attributable to ordinary shareholders was RMB25,476 million (US$3,693 million). Net income was RMB23,502 million (US$3,407 million), an increase of 96% year-over-year, primarily attributable to the year-over-year increase in net gain from mark-to-market changes of our equity investments, and disposal losses of Sun Art and Intime in the same quarter last year, partly offset by the decrease in adjusted EBITA. Non-GAAP net income in the quarter ended March 31, 2026 was RMB86 million (US$12 million), a decrease of 100% compared to RMB29,847 million in the same quarter of 2025. Diluted earnings per ADS was RMB10.36 (US$1.50). Diluted earnings per share was RMB1.30 (US$0.19 or HK$1.47). Non-GAAP diluted earnings per ADS was RMB0.62 (US$0.09), a decrease of 95% year-over-year. Non-GAAP diluted earnings per share was RMB0.08 (US$0.01 or HK$0.09), a decrease of 95% year-over-year. Net cash provided by operating activities was RMB9,410 million (US$1,364 million), a decrease of 66% compared to RMB27,520 million in the same quarter of 2025. Free cash flow, a non-GAAP measurement of liquidity, was an outflow of RMB17,300 million (US$2,508 million), compared to an inflow of RMB3,743 million in the same quarter of 2025. The decrease in free cash flow was mainly attributed to the investment in quick commerce, user acquisition of Qwen app and increase in our cloud infrastructure expenditure. As of March 31, 2026, our cash and other liquid investments(1) were RMB520,824 million (US$75,504 million). In the fiscal year ended March 31, 2026: Revenue was RMB1,023,670 million (US$148,401 million), an increase of 3% year-over-year. Excluding revenue from the disposed businesses of Sun Art and Intime, revenue on a like-for-like basis would have grown by 11% year-over-year. Customer management revenue increased by 5% year-over-year. Excluding the contra revenue impact from the new business development program, customer management revenue on a like-for-like basis would have grown by 7% year-over-year. Income from operations was RMB50,150 million (US$7,270 million), a decrease of 64% year-over-year, primarily due to the decrease in adjusted EBITA and increase in impairment of goodwill, partly offset by the decrease in one-time provisions and non-cash share-based expenses. Adjusted EBITA, a non-GAAP measurement, decreased 56% year-over-year to RMB76,416 million (US$11,078 million), primarily attributable to the investment in quick commerce, user experiences, and technology businesses, partly offset by the improved operating results supported by continued growth in customer management service and Cloud business, as well as enhanced operating efficiencies across various businesses. Net income attributable to ordinary shareholders was RMB105,904 million (US$15,353 million). Net income was RMB102,127 million (US$14,805 million), a decrease of 19% year-over-year, primarily attributable to the decrease in income from operations, partly offset by the year-over-year increase in net gain from mark-to-market changes of our equity investments, as well as net gains from disposal of investments, including local consumer service business of Trendyol in fiscal year 2026, compared to losses on disposal of Sun Art and Intime in fiscal year 2025. Non-GAAP net income in fiscal year 2026 was RMB60,658 million (US$8,794 million), a decrease of 62% compared to RMB158,122 million in fiscal year 2025. Diluted earnings per ADS was RMB44.00 (US$6.38). Diluted earnings per share was RMB5.50 (US$0.80 or HK$6.23). Non-GAAP diluted earnings per ADS was RMB26.80 (US$3.89), a decrease of 59% year-over-year. Non-GAAP diluted earnings per share was RMB3.35 (US$0.49 or HK$3.79), a decrease of 59% year-over-year. Net cash provided by operating activities was RMB76,213 million (US$11,049 million), a decrease of 53% compared to RMB163,509 million in fiscal year 2025. Free cash flow, a non-GAAP measurement of liquidity, was an outflow of RMB46,609 million (US$6,757 million), compared to an inflow of RMB73,870 million in fiscal year 2025. The decrease in free cash flow was mainly attributed to the investment in quick commerce and increase in our cloud infrastructure expenditure. As of March 31, 2026, our cash and other liquid investments(1) were RMB520,824 million (US$75,504 million). Reconciliations of GAAP measures to non-GAAP measures presented above are included at the end of this results announcement. ____________________ (1) Cash and other liquid investments represent cash and cash equivalents, short-term investments and other treasury investments included in equity securities and other investments on the consolidated balance sheets, of which that are unrestricted for withdrawal and use. BUSINESS AND STRATEGIC UPDATES Consumption Businesses Alibaba China E-commerce Group We are prioritizing the integration of AI capabilities with our e-commerce applications to enhance the experiences for both consumers and merchants. On the consumer side, we integrated Taobao and Tmall e-commerce service into the Qwen app, thereby expanding Qwen’s user reach and adding a brand new AI-driven experience for our Taobao and Tmall customers. Additionally, the Taobao app launched the Qwen Shopping Assistant, an AI agent providing end-to-end assistance across the entire shopping journey, including idea generation, product discovery, in-sale support, order management, and post-purchase services. For merchants, we rolled out Wukong, our AI-native enterprise agent that integrates advanced agentic capabilities into workflow to bring efficiency to merchant operations. To help merchants grow their businesses and increase willingness to spend on our platform, we upgraded our business development program for select merchants during the quarter, under which the level of platform subsidies for these merchants is directly tied to their marketing spend on our platform. For accounting purposes, such subsidies previously recorded as sales and marketing expenses are now recorded as a contra revenue item to customer management revenue (CMR). Accordingly, CMR grew 1% year-over-year during the quarter. Excluding the contra revenue impact from the program, on a like-for-like basis, CMR would have grown 8% year-over-year. Our quick commerce business remained focused on scaling the business while improving unit economics, with increasing focus on high-value food orders and non-food categories. The quick commerce business further improved unit economics, and increased average order value quarter-over-quarter primarily driven by order mix optimization. The number of 88VIP members, our highest spending consumer group, continued to increase by double digits year-over-year, surpassing 62 million. We remain focused on the retention of 88VIP members through enhanced value proposition to our most valued customers. Alibaba International Digital Commerce Group (“AIDC”) During the quarter, AIDC narrowed loss significantly year-over-year, approaching break-even, driven by a combination of logistics optimization and operating efficiency. The unit economics of the AliExpress’ Choice business continued to improve substantially on a sequential basis. We aim to diversify and enrich our product offerings by leveraging the supply chain advantages of the Alibaba ecosystem. AliExpress’ “Brand+” program further accelerated brand onboarding, and the penetration of quarterly transacting consumers for “Brand+” surpassed 30% during the quarter. Our international wholesale platform, Alibaba.com, continued to broaden adoption of its AI-powered tools among merchants. In addition to our established AI sourcing agent Accio, we also launched Accio Work, an agentic business platform designed to handle the full operating lifecycle of global small and medium-sized businesses beyond sourcing alone, aiming to significantly lower the entry barrier for cross-border commerce and enhance operational efficiency. AI + Cloud Businesses Cloud Intelligence Group For the quarter ended March 31, 2026, revenue from Cloud Intelligence Group was RMB41,626 million (US$6,035 million), a 38% increase from the same quarter last year. Notably, the year-over-year growth of revenue from external customers accelerated to 40%. This momentum was primarily driven by public cloud revenue growth, including the increasing adoption of AI-related products. AI-related product revenue continued to show strong momentum, achieving RMB8,971 million and delivering the eleventh consecutive quarter of triple-digit year-over-year growth. Alibaba Cloud continues to onboard more customers to our comprehensive AI + cloud products and services, including high-performance networking, distributed storage, cloud operating system, and services for model training and inference. We are executing our strategy to lead China’s AI cloud market through our comprehensive full-stack AI capabilities across AI models, AI cloud infrastructure, and orchestration software that manages heterogeneous chip clusters, including our own proprietary inference chips. During the quarter, we focused on executing our Model-as-a-Service (MaaS) strategy. As we observed rapidly increasing demand for MaaS, we launched a diverse portfolio of offerings on our MaaS platform Model Studio tailored to users ranging from individual developers to large enterprises. This comprises an expanded lineup of state-of-the-art models such as Qwen3.6-Plus, enterprise solutions with flexible Token Plans, and a growing suite of agents including Wukong, Meoo, and industry-specific agents. As a result, the customer base for Model Studio grew by eight-fold year-over-year as of March 2026. Model We continue to push the boundaries of AI capabilities through deep innovation, and we achieved significant breakthroughs in model intelligence recently through a series of new model launches within our large language and multimodal model portfolio. In March, we introduced Qwen3.6-Plus which delivered significant all-round performance gains, with particularly notable improvements in coding and agentic programming. It achieves state-of-the-art results across front-end web development and complex repository-level tasks. Qwen3.6-Plus also features enhanced multimodal perception and reasoning, and a native context window of up to 1 million tokens, while further improving stability and reliability. Complementing the Qwen family, we are also advancing specialized models including HappyOyster, a world model enabling real-time creation and interaction, and HappyHorse, a multimodal model for video generation. The commercialization of both models is currently being rolled out in phases. Chip Design – T-Head T-Head Semiconductor Co., Ltd. (“T-Head”), our chip design subsidiary, has achieved widespread industrial application of its proprietary AI chips, with the automotive sector serving as a leading example of large-scale adoption. Over 100,000 Zhenwu PPUs have been deployed on Alibaba Cloud’s public cloud platform, with more than 30 leading automakers and autonomous driving companies leveraging the chips for intelligent driving R&D. The Zhenwu chips, together with Alibaba Cloud and Qwen models, form a fully integrated technology stack that significantly accelerates both training and inference efficiency. Dividends Our board of directors has approved an annual regular cash dividend for fiscal year 2026 in the amount of US$0.13125 per ordinary share or US$1.05 per ADS, payable in U.S. dollars, to holders of ordinary shares and holders of ADSs, as of the close of business on June 11, 2026, Hong Kong Time and New York Time, respectively. The aggregate amount of the dividend will be approximately US$2.5 billion. As at the date hereof, the company does not hold any treasury shares whether in the Central Clearing and Settlement System, or otherwise. For holders of ordinary shares, in order to qualify for the dividend, all valid documents for the transfers of shares accompanied by the relevant share certificates must be lodged with the company’s Hong Kong branch share registrar, Computershare Hong Kong Investor Services Limited, at Shops 1712-1716, 17th Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong, not later than 4:30 p.m. on June 11, 2026, Hong Kong Time. The payment date is expected to be on or around July 6, 2026 for holders of ordinary shares and on or around July 13, 2026 for holders of ADSs. MARCH QUARTER SUMMARY FINANCIAL RESULTS Three months ended March 31, 2025 2026 RMB RMB US$ YoY %
Change (in millions, except percentages and per share amounts) Revenue 236,454 243,380 35,283 3% Income (Loss) from operations 28,465(2) (848)(2) (123) N/A Operating margin 12% 0% Adjusted EBITDA(1) 41,783 16,435 2,383 (61)%(2) Adjusted EBITDA margin(1) 18% 7% Adjusted EBITA(1) 32,616 5,102 740 (84)%(2) Adjusted EBITA margin(1) 14% 2% Net income 11,973 23,502 3,407 96%(3) Net income attributable to ordinary shareholders 12,382 25,476 3,693 106%(3) Non-GAAP net income(1) 29,847 86 12 (100)%(2) Diluted earnings per share(4) 0.65 1.30 0.19 101%(3)(5) Diluted earnings per ADS(4) 5.17 10.36 1.50 101%(3)(5) Non-GAAP diluted earnings per share(1)(4) 1.57 0.08 0.01 (95)%(2)(5) Non-GAAP diluted earnings per ADS(1)(4) 12.52 0.62 0.09 (95)%(2)(5) ____________________ (1) See the sections entitled “Non-GAAP Financial Measures” and “Reconciliations of Non-GAAP Measures to the Nearest Comparable U.S. GAAP Measures” for more information about the non-GAAP measures referred to within this results announcement. (2) The year-over-year decreases were primarily attributable to the investment in technology businesses, quick commerce and user experiences, partly offset by the improved operating results supported by continued growth in customer management service and Cloud business, as well as enhanced operating efficiencies across various businesses. (3) The year-over-year increases were primarily attributable to the year-over-year increase in net gain from mark-to-market changes of our equity investments, and disposal losses of Sun Art and Intime in the same quarter last year, partly offset by the decrease in adjusted EBITA, while net income attributable to ordinary shareholders and earnings per share/ADS would further take into account the net loss attributable to noncontrolling interests. We excluded non-cash share-based compensation expense, gains/losses of investments, impairment of goodwill and intangible assets, and certain other items from our non-GAAP measurements. (4) Each ADS represents eight ordinary shares. (5) The year-over-year percentages as stated are calculated based on the exact amount and there may be minor differences from the year-over-year percentages calculated based on the RMB amounts after rounding. MARCH QUARTER SEGMENT RESULTS Revenue for the quarter ended March 31, 2026 was RMB243,380 million (US$35,283 million), an increase of 3% year-over-year compared to RMB236,454 million in the same quarter of 2025. Excluding revenue from the disposed businesses of Sun Art and Intime, revenue on a like-for-like basis would have grown by 11% year-over-year. The following table sets forth a breakdown of our revenue by segment for the periods indicated: Three months ended March 31, 2025 2026 RMB RMB US$ YoY %
Change (in millions, except percentages) Alibaba China E-commerce Group: E-commerce - Customer management 72,180 73,024 10,586 1 % - Direct sales, logistics and others(2) 24,665 23,268 3,373 (6 )% 96,845 96,292 13,959 (1 )% Quick commerce(3) 12,715 19,988 2,898 57 % China commerce wholesale 5,788 5,940 861 3 % Total Alibaba China E-commerce Group 115,348 122,220 17,718 6 % Alibaba International Digital Commerce Group: International commerce retail 27,603 28,917 4,192 5 % International commerce wholesale 5,976 6,512 944 9 % Total Alibaba International Digital Commerce Group 33,579 35,429 5,136 6 % Cloud Intelligence Group 30,127 41,626 6,035 38 % All others(4) 83,276 65,459 9,490 (21 )% Unallocated 446 641 93 Inter-segment elimination (26,322 ) (21,995 ) (3,189 ) Consolidated revenue 236,454 243,380 35,283 3 % ____________________ (1) To advance our “user first” strategy and enhance user experience, during the quarter ended June 30, 2025, we undertook a strategic combination of Taobao and Tmall Group, Ele.me and Fliggy into Alibaba China E-commerce Group. We simplified the financial reporting structure by reclassifying Cainiao, Amap and Digital Media and Entertainment Group (rebranded to Hujing Digital Media and Entertainment Group) into “All others”. The above presentation has been updated to conform with the new reporting structure, as reviewed by our chief operating decision maker. (2) Direct sales, logistics and others revenue under Alibaba China E-commerce Group primarily represents direct sales businesses of Tmall Supermarket, Tmall Global and other businesses, where revenue and cost of inventory are recorded on a gross basis within the business group, as well as revenue from logistics services and value-added services. (3) Quick commerce revenue represents quick commerce business revenue, including revenue generated through “Taobao Instant Commerce” and the Ele.me app. Quick commerce revenue is net of subsidies that are contra revenue. (4) All others include Freshippo, Cainiao, Alibaba Health, Hujing Digital Media and Entertainment Group, Amap, Qwen Consumer Business Group, Lingxi Games, DingTalk and other businesses. The majority of revenue within All others consists of direct sales, where revenue and cost of inventory are recorded on a gross basis, and revenue from logistics services. The decrease was primarily due to the revenue decrease as a result of the disposal of Sun Art and Intime businesses, as well as the decrease in revenue from Cainiao, partly offset by the increase in revenue from Freshippo and Amap. The following table sets forth a breakdown of our adjusted EBITA by segment for the periods indicated: Three months ended March 31, 2025 2026 RMB RMB US$ YoY %
Change(3) (in millions, except percentages) Alibaba China E-commerce Group 39,742 24,010 3,481 (40 )% Alibaba International Digital Commerce Group (3,574 ) (138 ) (20 ) 96 % Cloud Intelligence Group 2,420 3,796 550 57 % All others (3,413 ) (21,160 ) (3,067 ) (520 )% Unallocated(2) (2,030 ) (788 ) (114 ) Inter-segment elimination (529 ) (618 ) (90 ) Consolidated adjusted EBITA 32,616 5,102 740 (84 )% Less: Non-cash share-based compensation expense (2,781 ) (2,708 ) (393 ) Less: Amortization and impairment of intangible assets, and others (1,370 ) (3,242 ) (470 ) Income (Loss) from operations 28,465 (848 ) (123 ) N/A ____________________ (1) To advance our “user first” strategy and enhance user experience, during the quarter ended June 30, 2025, we undertook a strategic combination of Taobao and Tmall Group, Ele.me and Fliggy into Alibaba China E-commerce Group. We simplified the financial reporting structure by reclassifying Cainiao, Amap and Digital Media and Entertainment Group (rebranded to Hujing Digital Media and Entertainment Group) into “All others”. The above presentation has been updated to conform with the new reporting structure, as reviewed by our chief operating decision maker. (2) Unallocated primarily relates to certain costs incurred by corporate functions and other miscellaneous items that are not allocated to individual segments. (3) For a more intuitive presentation, widening of loss in YoY% is shown in terms of negative growth rate, and narrowing of loss in YoY% is shown in terms of positive growth rate. Alibaba China E-commerce Group (i) Segment revenue E-commerce Business Revenue from our E-commerce business in the quarter ended March 31, 2026 was RMB96,292 million (US$13,959 million), a decrease of 1% compared to RMB96,845 million in the same quarter of 2025. Customer management revenue increased by 1% year-over-year. Excluding the contra revenue impact from the new business development program, customer management revenue on a like-for-like basis would have grown by 8% year-over-year. Direct sales, logistics and others revenue under E-commerce business in the quarter ended March 31, 2026 was RMB23,268 million (US$3,373 million), a decrease of 6% compared to RMB24,665 million in the same quarter of 2025, primarily due to the decrease in revenue from certain direct sales businesses. Quick Commerce Business Revenue from our Quick commerce business in the quarter ended March 31, 2026 was RMB19,988 million (US$2,898 million), an increase of 57% compared to RMB12,715 million in the same quarter of 2025, mainly due to order growth as a result of the rollout of “Taobao Instant Commerce” at the end of April 2025. China Commerce Wholesale Business Revenue from our China commerce wholesale business in the quarter ended March 31, 2026 was RMB5,940 million (US$861 million), an increase of 3% compared to RMB5,788 million in the same quarter of 2025, primarily due to an increase in revenue from value-added services provided to paying members. (ii) Segment adjusted EBITA Alibaba China E-commerce Group adjusted EBITA decreased by 40% to RMB24,010 million (US$3,481 million) in the quarter ended March 31, 2026, compared to RMB39,742 million in the same quarter of 2025, primarily due to the investment in quick commerce, user experiences, and technology, while there is positive contribution from customer management service. Alibaba International Digital Commerce Group (i) Segment revenue International Commerce Retail Business Revenue from our International commerce retail business in the quarter ended March 31, 2026 was RMB28,917 million (US$4,192 million), an increase of 5% compared to RMB27,603 million in the same quarter of 2025, comprising the revenue increase contributed by AliExpress and other international businesses, and partly offset by the revenue decrease of Lazada. As certain of our international businesses generate revenue in local currencies while our reporting currency is Renminbi, AIDC’s revenue is affected by exchange rate fluctuations. International Commerce Wholesale Business Revenue from our International commerce wholesale business in the quarter ended March 31, 2026 was RMB6,512 million (US$944 million), an increase of 9% compared to RMB5,976 million in the same quarter of 2025, primarily due to an increase in revenue generated by cross-border related value-added services. (ii) Segment adjusted EBITA Alibaba International Digital Commerce Group adjusted EBITA was a loss of RMB138 million (US$20 million) in the quarter ended March 31, 2026, compared to a loss of RMB3,574 million in the same quarter of 2025, primarily due to significant improvement in AliExpress’ operating efficiency, and enhanced efficiencies across various businesses. Cloud Intelligence Group (i) Segment revenue Revenue from Cloud Intelligence Group was RMB41,626 million (US$6,035 million) in the quarter ended March 31, 2026, an increase of 38% compared to RMB30,127 million in the same quarter of 2025. Overall revenue from external customers increased by 40% year-over-year, primarily driven by public cloud revenue growth, including the increasing adoption of AI-related products. (ii) Segment adjusted EBITA Cloud Intelligence Group adjusted EBITA increased by 57% to RMB3,796 million (US$550 million) in the quarter ended March 31, 2026, compared to RMB2,420 million in the same quarter of 2025, primarily due to revenue growth and improving operating efficiency, partly offset by the increasing investments in customer growth and technology innovation. All Others (i) Segment revenue Revenue from All others segment was RMB65,459 million (US$9,490 million) in the quarter ended March 31, 2026, a decrease of 21% compared to RMB83,276 million in the same quarter of 2025, primarily due to the revenue decrease as a result of the disposal of Sun Art and Intime businesses, as well as the decrease in revenue from Cainiao, partly offset by the increase in revenue from Freshippo and Amap. (ii) Segment adjusted EBITA Adjusted EBITA from All others segment in the quarter ended March 31, 2026 was a loss of RMB21,160 million (US$3,067 million), compared to a loss of RMB3,413 million in the same quarter of 2025, primarily due to the increased investment in technology businesses (including investment in user acquisition of Qwen app), partly offset by the improved operating results of other businesses. MARCH QUARTER OTHER FINANCIAL RESULTS Costs and Expenses The following tables set forth a breakdown of our costs and expenses, share-based compensation expense, and costs and expenses excluding share-based compensation expense by function for the periods indicated: Three months ended March 31, % of
Revenue
YoY
change 2025 2026 RMB % of
Revenue RMB US$ % of
Revenue (in millions, except percentages) Costs and expenses: Cost of revenue 145,626 61.6 % 159,392 23,107 65.5 % 3.9 % Product development expenses 14,934 6.3 % 18,957 2,748 7.8 % 1.5 % Sales and marketing expenses 36,179 15.3 % 53,415 7,744 21.9 % 6.6 % General and administrative expenses 10,331 4.4 % 9,949 1,442 4.1 % (0.3 )% Amortization and impairment of intangible assets 833 0.4 % 2,605 378 1.1 % 0.7 % Total costs and expenses 207,903 244,318 35,419 Share-based compensation expense: Cost of revenue 417 0.2 % 487 70 0.2 % 0.0 % Product development expenses 1,538 0.7 % 1,247 181 0.5 % (0.2 )% Sales and marketing expenses 654 0.3 % 352 51 0.1 % (0.2 )% General and administrative expenses 826 0.3 % 1,006 146 0.4 % 0.1 % Total share-based compensation expense(1) 3,435 3,092 448 Costs and expenses excluding share-based compensation expense: Cost of revenue 145,209 61.4 % 158,905 23,037 65.3 % 3.9 % Product development expenses 13,396 5.7 % 17,710 2,567 7.3 % 1.6 % Sales and marketing expenses 35,525 15.0 % 53,063 7,693 21.8 % 6.8 % General and administrative expenses 9,505 4.0 % 8,943 1,296 3.7 % (0.3 )% Amortization and impairment of intangible assets 833 0.4 % 2,605 378 1.1 % 0.7 % Total costs and expenses excluding share-based compensation expense 204,468 241,226 34,971 ____________________ (1) This includes both cash and non-cash share-based compensation expenses. Cost of revenue – Cost of revenue in the quarter ended March 31, 2026 was RMB159,392 million (US$23,107 million), or 65.5% of revenue, compared to RMB145,626 million, or 61.6% of revenue, in the same quarter of 2025. Without the effect of share-based compensation expense, cost of revenue as a percentage of revenue would have increased from 61.4% in the quarter ended March 31, 2025 to 65.3% in the quarter ended March 31, 2026, primarily driven by the growth in our cloud and technology businesses, and our expansion in quick commerce businesses, partly offset by the disposal of Sun Art and Intime. Product development expenses – Product development expenses in the quarter ended March 31, 2026 were RMB18,957 million (US$2,748 million), or 7.8% of revenue, compared to RMB14,934 million, or 6.3% of revenue, in the same quarter of 2025. Without the effect of share-based compensation expense, product development expenses as a percentage of revenue would have increased from 5.7% in the quarter ended March 31, 2025 to 7.3% in the quarter ended March 31, 2026, primarily due to investments in our research and development personnel and other technology infrastructure costs. Sales and marketing expenses – Sales and marketing expenses in the quarter ended March 31, 2026 were RMB53,415 million (US$7,744 million), or 21.9% of revenue, compared to RMB36,179 million, or 15.3% of revenue, in the same quarter of 2025. Without the effect of share-based compensation expense, sales and marketing expenses as a percentage of revenue would have increased from 15.0% in the quarter ended March 31, 2025 to 21.8% in the quarter ended March 31, 2026, primarily attributable to the investment in quick commerce business and user acquisition of Qwen app. General and administrative expenses – General and administrative expenses in the quarter ended March 31, 2026 were RMB9,949 million (US$1,442 million), or 4.1% of revenue, compared to RMB10,331 million, or 4.4% of revenue, in the same quarter of 2025. Without the effect of share-based compensation expense, general and administrative expenses as a percentage of revenue would have decreased from 4.0% in the quarter ended March 31, 2025 to 3.7% in the quarter ended March 31, 2026. Share-based compensation expense – Total share-based compensation expense included in the cost and expense items above in the quarter ended March 31, 2026 was RMB3,092 million (US$448 million), compared to RMB3,435 million in the same quarter of 2025. The following table sets forth our analysis of share-based compensation expense for the quarters indicated by type of share-based awards: Three months ended March 31, 2025 2026 RMB RMB US$ YoY %
Change (in millions, except percentages) By type of awards: Alibaba Group share-based awards(1) 2,712 2,297 333 (15 )% Others(2) 723 795 115 10 % Total share-based compensation expense(3) 3,435 3,092 448 (10 )% ____________________ (1) This represents Alibaba Group share-based awards granted to our employees. (2) This represents share-based awards of our subsidiaries and Ant Group granted to our employees. (3) This includes both cash and non-cash share-based compensation expenses. Share-based compensation expense decreased in the quarter ended March 31, 2026 compared to the same quarter of 2025. The decrease was primarily due to the decrease in the number of awards granted as we have increased the proportion of long-term cash incentives granted after considering the macroeconomic environment and the general trends in the talent market. We expect that our share-based compensation expense will continue to be affected by changes in the fair value of the underlying awards and the quantity of awards we grant in the future. Amortization and impairment of intangible assets – Amortization and impairment of intangible assets in the quarter ended March 31, 2026 was RMB2,605 million (US$378 million), an increase of 213% from RMB833 million in the same quarter of 2025, primarily due to the impairment of intangible assets relating to our business within Alibaba China E-commerce Group. Income (Loss) from operations and operating margin Loss from operations in the quarter ended March 31, 2026 was RMB848 million (US$123 million), compared to an income from operations of RMB28,465 million, or 12% of revenue, in the same quarter of 2025, primarily due to the decrease in adjusted EBITA. Adjusted EBITDA and Adjusted EBITA Adjusted EBITDA decreased 61% year-over-year to RMB16,435 million (US$2,383 million) in the quarter ended March 31, 2026, compared to RMB41,783 million in the same quarter of 2025. Adjusted EBITA decreased 84% year-over-year to RMB5,102 million (US$740 million) in the quarter ended March 31, 2026, compared to RMB32,616 million in the same quarter of 2025, primarily attributable to the investment in technology businesses, quick commerce and user experiences, partly offset by the improved operating results supported by continued growth in customer management service and Cloud business, as well as enhanced operating efficiencies across various businesses. A reconciliation of net income to adjusted EBITDA and adjusted EBITA is included at the end of this results announcement. Adjusted EBITA by segment Adjusted EBITA by segment as well as a reconciliation of income from operations to adjusted EBITA are set forth in the section entitled “March Quarter Segment Results” above. Interest and investment income, net Interest and investment income, net in the quarter ended March 31, 2026 was a gain of RMB33,823 million (US$4,903 million), compared to a loss of RMB7,516 million in the same quarter of 2025, primarily due to the year-over-year increase in net gain from mark-to-market changes of our equity investments, and disposal losses of Sun Art and Intime in the same quarter last year. The above-mentioned investment gains and losses were excluded from our non-GAAP net income. Other income, net Other income, net in the quarter ended March 31, 2026 was RMB623 million (US$91 million), an increase of 3015% compared to RMB20 million in the same quarter of 2025. Income tax expenses Income tax expenses in the quarter ended March 31, 2026 were RMB7,170 million (US$1,040 million), compared to RMB6,854 million in the same quarter of 2025. Share of results of equity method investees Share of results of equity method investees in the quarter ended March 31, 2026 was a loss of RMB685 million (US$99 million), compared to a profit of RMB354 million in the same quarter of 2025. The following table sets forth a breakdown of share of results of equity method investees for the periods indicated: Three months ended March 31, 2025 2026 RMB RMB US$ (in millions) Share of profit (loss) of equity method investees - Ant Group 1,763 375 55 - Others (981 ) (198 ) (29 ) Impairment loss (43 ) (9 ) (1 ) Others(1) (385 ) (853 ) (124 ) Total 354 (685 ) (99 ) ____________________ (1) “Others” mainly include basis differences arising from equity method investees, share-based compensation expense related to share-based awards granted to employees of our equity method investees, as well as gain or loss arising from the deemed disposal of the equity method investees. We record our share of results of all equity method investees one quarter in arrears. The year-over-year decrease in share of profit of Ant Group reflected its increased investments in new growth initiatives, including user growth, and technologies. Net income and Non-GAAP net income Our net income in the quarter ended March 31, 2026 was RMB23,502 million (US$3,407 million), compared to RMB11,973 million in the same quarter of 2025, primarily attributable to the year-over-year increase in net gain from mark-to-market changes of our equity investments, and the disposal losses of Sun Art and Intime in the same quarter last year, partly offset by the decrease in adjusted EBITA. Excluding non-cash share-based compensation expense, gains/losses of investments, impairment of goodwill and intangible assets, and certain other items, non-GAAP net income in the quarter ended March 31, 2026 was RMB86 million (US$12 million), a decrease of 100% compared to RMB29,847 million in the same quarter of 2025, primarily attributable to the investment in technology businesses, quick commerce and user experiences, partly offset by the improved operating results supported by continued growth in customer management service and Cloud business, as well as enhanced operating efficiencies across various businesses. A reconciliation of net income to non-GAAP net income is included at the end of this results announcement. Net income attributable to ordinary shareholders Net income attributable to ordinary shareholders in the quarter ended March 31, 2026 was RMB25,476 million (US$3,693 million), compared to RMB12,382 million in the same quarter of 2025, primarily attributable to the year-over-year increase in net gain from mark-to-market changes of our equity investments, and the disposal losses of Sun Art and Intime in the same quarter last year, partly offset by the decrease in adjusted EBITA. Diluted earnings per ADS/share and non-GAAP diluted earnings per ADS/share Diluted earnings per ADS in the quarter ended March 31, 2026 was RMB10.36 (US$1.50), compared to RMB5.17 in the same quarter of 2025. Excluding non-cash share-based compensation expense, gains/losses of investments, impairment of goodwill and intangible assets, and certain other items, non-GAAP diluted earnings per ADS in the quarter ended March 31, 2026 was RMB0.62 (US$0.09), a decrease of 95% compared to RMB12.52 in the same quarter of 2025. Diluted earnings per share in the quarter ended March 31, 2026 was RMB1.30 (US$0.19 or HK$1.47), compared to RMB0.65 in the same quarter of 2025. Excluding non-cash share-based compensation expense, gains/losses of investments, impairment of goodwill and intangible assets, and certain other items, non-GAAP diluted earnings per share in the quarter ended March 31, 2026 was RMB0.08 (US$0.01 or HK$0.09), a decrease of 95% compared to RMB1.57 in the same quarter of 2025. A reconciliation of diluted earnings per ADS/share to non-GAAP diluted earnings per ADS/share is included at the end of this results announcement. Each ADS represents eight ordinary shares. Net cash provided by operating activities and free cash flow During the quarter ended March 31, 2026, net cash provided by operating activities was RMB9,410 million (US$1,364 million), a decrease of 66% compared to RMB27,520 million in the same quarter of 2025. Free cash flow, a non-GAAP measurement of liquidity, was an outflow of RMB17,300 million (US$2,508 million), compared to an inflow of RMB3,743 million in the same quarter of 2025. The decrease in free cash flow was mainly attributed to the investment in quick commerce, user acquisition of Qwen app and increase in our cloud infrastructure expenditure. A reconciliation of net cash provided by operating activities to free cash flow is included at the end of this results announcement. Net cash provided by investing activities During the quarter ended March 31, 2026, net cash provided by investing activities of RMB9,704 million (US$1,407 million) primarily reflected net decrease in short-term investments and other treasury investments by RMB30,750 million (US$4,458 million), net cash inflow of RMB6,294 million (US$912 million) from investment and acquisition activities, partly offset by capital expenditures of RMB26,887 million (US$3,898 million). Net cash used in financing activities During the quarter ended March 31, 2026, net cash used in financing activities of RMB15,002 million (US$2,175 million) primarily reflected cash used in acquisition of additional equity interests in non-wholly owned subsidiaries of RMB14,691 million (US$2,130 million). Employees As of March 31, 2026, we had a total of 131,462 employees, compared to 128,197 as of December 31, 2025. FULL FISCAL YEAR SUMMARY FINANCIAL RESULTS Year ended March 31, 2025 2026 RMB RMB US$ YoY %
Change (in millions, except percentages and per share amounts) Revenue 996,347 1,023,670 148,401 3% Income from operations 140,905 50,150 7,270 (64)%(2) Operating margin 14% 5% Adjusted EBITDA(1) 202,325 113,483 16,452 (44)%(2) Adjusted EBITDA margin(1) 20% 11% Adjusted EBITA(1) 173,065 76,416 11,078 (56)%(2) Adjusted EBITA margin(1) 17% 7% Net income 125,976 102,127 14,805 (19)%(3) Net income attributable to ordinary shareholders 129,470 105,904 15,353 (18)%(3) Non-GAAP net income(1) 158,122 60,658 8,794 (62)%(2) Diluted earnings per share(4) 6.70 5.50 0.80 (18)%(3)(5) Diluted earnings per ADS(4) 53.59 44.00 6.38 (18)%(3)(5) Non-GAAP diluted earnings per share(1)(4) 8.18 3.35 0.49 (59)%(2)(5) Non-GAAP diluted earnings per ADS(1)(4) 65.41 26.80 3.89 (59)%(2)(5) ____________________ (1) See the sections entitled “Non-GAAP Financial Measures” and “Reconciliations of Non-GAAP Measures to the Nearest Comparable U.S. GAAP Measures” for more information about the non-GAAP measures referred to within this results announcement. (2) The year-over-year decreases were primarily attributable to the investment in quick commerce, user experiences, and technology businesses, partly offset by the improved operating results supported by continued growth in customer management service and Cloud business, as well as enhanced operating efficiencies across various businesses. (3) The year-over-year decreases were primarily attributable to the decrease in income from operations, partly offset by the year-over-year increase in net gain from mark-to-market changes of our equity investments, as well as net gains from disposal of investments, including local consumer service business of Trendyol in fiscal year 2026, compared to losses on disposal of Sun Art and Intime in fiscal year 2025, while net income attributable to ordinary shareholders and earnings per share/ADS would further take into account the net loss attributable to noncontrolling interests. We excluded non-cash share-based compensation expense, gains/losses of investments, impairment of goodwill and intangible assets, and certain other items from our non-GAAP measurements. (4) Each ADS represents eight ordinary shares. (5) The year-over-year percentages as stated are calculated based on the exact amount and there may be minor differences from the year-over-year percentages calculated based on the RMB amounts after rounding. FULL FISCAL YEAR SEGMENT RESULTS Revenue for fiscal year 2026 was RMB1,023,670 million (US$148,401 million), an increase of 3% year-over-year compared to RMB996,347 million in fiscal year 2025. Excluding revenue from the disposed businesses of Sun Art and Intime, revenue on a like-for-like basis would have grown by 11% year-over-year. The following table sets forth a breakdown of our revenue by segment for the periods indicated: Year ended March 31, 2025 2026 RMB RMB US$ YoY %
Change (in millions, except percentages) Alibaba China E-commerce Group: E-commerce - Customer management 326,769 343,867 49,850 5 % - Direct sales, logistics and others(2) 103,722 105,518 15,297 2 % 430,491 449,385 65,147 4 % Quick commerce(3) 53,588 78,520 11,383 47 % China commerce wholesale 24,301 26,312 3,815 8 % Total Alibaba China E-commerce Group 508,380 554,217 80,345 9 % Alibaba International Digital Commerce Group: International commerce retail 108,465 117,731 17,067 9 % International commerce wholesale 23,835 26,439 3,833 11 % Total Alibaba International Digital Commerce Group 132,300 144,170 20,900 9 % Cloud Intelligence Group 118,028 158,132 22,924 34 % All others(4) 338,347 254,367 36,876 (25 )% Unallocated 1,924 2,340 339 Inter-segment elimination (102,632 ) (89,556 ) (12,983 ) Consolidated revenue 996,347 1,023,670 148,401 3 % ____________________ (1) To advance our “user first” strategy and enhance user experience, during the quarter ended June 30, 2025, we undertook a strategic combination of Taobao and Tmall Group, Ele.me and Fliggy into Alibaba China E-commerce Group. We simplified the financial reporting structure by reclassifying Cainiao, Amap and Digital Media and Entertainment Group (rebranded to Hujing Digital Media and Entertainment Group) into “All others”. The above presentation has been updated to conform with the new reporting structure, as reviewed by our chief operating decision maker. (2) Direct sales, logistics and others revenue under Alibaba China E-commerce Group primarily represents direct sales businesses of Tmall Supermarket, Tmall Global and other businesses, where revenue and cost of inventory are recorded on a gross basis within the business group, as well as revenue from logistics services and value-added services. (3) Quick commerce revenue represents quick commerce business revenue, including revenue generated through “Taobao Instant Commerce” and the Ele.me app. Quick commerce revenue is net of subsidies that are contra revenue. (4) All others include Freshippo, Cainiao, Alibaba Health, Hujing Digital Media and Entertainment Group, Amap, Qwen Consumer Business Group, Lingxi Games, DingTalk and other businesses. The majority of revenue within All others consists of direct sales, where revenue and cost of inventory are recorded on a gross basis, and revenue from logistics services. The decrease was primarily due to the revenue decrease as a result of the disposal of Sun Art and Intime businesses, as well as the decrease in revenue from Cainiao, partly offset by the increase in revenue from Freshippo, Alibaba Health and Amap. The following table sets forth a breakdown of our adjusted EBITA by segment for the periods indicated: Year ended March 31, 2025 2026 RMB RMB US$ YoY %
Change(3) (in millions, except percentages) Alibaba China E-commerce Group 193,223 107,509 15,586 (44 )% Alibaba International Digital Commerce Group (15,137 ) (2,051 ) (297 ) 86 % Cloud Intelligence Group 10,556 14,265 2,068 35 % All others (9,499 ) (35,737 ) (5,181 ) (276 )% Unallocated(2) (4,337 ) (5,150 ) (747 ) Inter-segment elimination (1,741 ) (2,420 ) (351 ) Consolidated adjusted EBITA 173,065 76,416 11,078 (56 )% Less: Non-cash share-based compensation expense (13,970 ) (11,180 ) (1,621 ) Less: Amortization and impairment of intangible assets (6,336 ) (5,079 ) (736 ) Less: Impairment of goodwill, and others (11,854 ) (10,007 ) (1,451 ) Income from operations 140,905 50,150 7,270 (64 )% ____________________ (1) To advance our “user first” strategy and enhance user experience, during the quarter ended June 30, 2025, we undertook a strategic combination of Taobao and Tmall Group, Ele.me and Fliggy into Alibaba China E-commerce Group. We simplified the financial reporting structure by reclassifying Cainiao, Amap and Digital Media and Entertainment Group (rebranded to Hujing Digital Media and Entertainment Group) into “All others”. The above presentation has been updated to conform with the new reporting structure, as reviewed by our chief operating decision maker. (2) Unallocated primarily relates to certain costs incurred by corporate functions and other miscellaneous items that are not allocated to individual segments. (3) For a more intuitive presentation, widening of loss in YoY% is shown in terms of negative growth rate, and narrowing of loss in YoY% is shown in terms of positive growth rate. Alibaba China E-commerce Group (i) Segment revenue E-commerce Business Revenue from our E-commerce business in fiscal year 2026 was RMB449,385 million (US$65,147 million), an increase of 4% compared to RMB430,491 million in fiscal year 2025. Customer management revenue increased by 5% year-over-year, primarily driven by the improvement of take rate year-over-year. Excluding the contra revenue impact from the new business development program, customer management revenue on a like-for-like basis would have grown by 7% year-over-year. Direct sales, logistics and others revenue under E-commerce business in fiscal year 2026 was RMB105,518 million (US$15,297 million), an increase of 2% compared to RMB103,722 million in fiscal year 2025, primarily driven by the increase in revenue from logistics services and value-added services, partly offset by the decrease in revenue from certain direct sales businesses. Quick Commerce Business Revenue from our Quick commerce business in fiscal year 2026 was RMB78,520 million (US$11,383 million), an increase of 47% compared to RMB53,588 million in fiscal year 2025, mainly due to order growth as a result of the rollout of “Taobao Instant Commerce” at the end of April 2025. China Commerce Wholesale Business Revenue from our China commerce wholesale business in fiscal year 2026 was RMB26,312 million (US$3,815 million), an increase of 8% compared to RMB24,301 million in fiscal year 2025, primarily due to an increase in revenue from value-added services provided to paying members. (ii) Segment adjusted EBITA Alibaba China E-commerce Group adjusted EBITA decreased by 44% to RMB107,509 million (US$15,586 million) in fiscal year 2026, compared to RMB193,223 million in fiscal year 2025, primarily due to the investment in quick commerce, user experiences, and technology, while there is positive contribution from customer management service. Alibaba International Digital Commerce Group (i) Segment revenue International Commerce Retail Business Revenue from our International commerce retail business in fiscal year 2026 was RMB117,731 million (US$17,067 million), an increase of 9% compared to RMB108,465 million in fiscal year 2025, primarily driven by the increase in revenue contributed by AliExpress and other international businesses, and partly offset by the revenue decrease of Lazada. As certain of our international businesses generate revenue in local currencies while our reporting currency is Renminbi, AIDC’s revenue is affected by exchange rate fluctuations. International Commerce Wholesale Business Revenue from our International commerce wholesale business in fiscal year 2026 was RMB26,439 million (US$3,833 million), an increase of 11% compared to RMB23,835 million in fiscal year 2025, primarily due to an increase in revenue generated by cross-border related value-added services. (ii) Segment adjusted EBITA Alibaba International Digital Commerce Group adjusted EBITA was a loss of RMB2,051 million (US$297 million) in fiscal year 2026, compared to a loss of RMB15,137 million in fiscal year 2025, primarily due to significant improvement in AliExpress’ operating efficiency, and enhanced efficiencies across various businesses. Cloud Intelligence Group (i) Segment revenue Revenue from Cloud Intelligence Group was RMB158,132 million (US$22,924 million) in fiscal year 2026, an increase of 34% compared to RMB118,028 million in fiscal year 2025. Overall revenue from external customers increased by 33% year-over-year, primarily driven by public cloud revenue growth, including the increasing adoption of AI-related products. (ii) Segment adjusted EBITA Cloud Intelligence Group adjusted EBITA increased by 35% to RMB14,265 million (US$2,068 million) in fiscal year 2026, compared to RMB10,556 million in fiscal year 2025, primarily due to revenue growth and improving operating efficiency, partly offset by the increasing investments in customer growth and technology innovation. All Others (i) Segment revenue Revenue from All others segment was RMB254,367 million (US$36,876 million) in fiscal year 2026, a decrease of 25% compared to RMB338,347 million in fiscal year 2025, primarily due to the revenue decrease as a result of the disposal of Sun Art and Intime businesses, as well as the decrease in revenue from Cainiao, partly offset by the increase in revenue from Freshippo, Alibaba Health and Amap. (ii) Segment adjusted EBITA Adjusted EBITA from All others segment in fiscal year 2026 was a loss of RMB35,737 million (US$5,181 million), compared to a loss of RMB9,499 million in fiscal year 2025, primarily due to the increased investment in technology businesses, partly offset by the improved results of Hujing Digital Media and Entertainment Group and other businesses. FULL FISCAL YEAR OTHER FINANCIAL RESULTS Costs and Expenses The following tables set forth a breakdown of our costs and expenses, share-based compensation expense, and costs and expenses excluding share-based compensation expense by function for the periods indicated: Year ended March 31, % of
Revenue
YoY
change 2025 2026 RMB % of
Revenue RMB US$ % of
Revenue (in millions, except percentages) Costs and expenses: Cost of revenue 598,285 60.0 % 616,136 89,321 60.2 % 0.2 % Product development expenses 57,151 5.7 % 66,533 9,645 6.5 % 0.8 % Sales and marketing expenses 144,021 14.5 % 245,023 35,521 23.9 % 9.4 % General and administrative expenses 44,239 4.4 % 33,082 4,796 3.2 % (1.2 )% Amortization and impairment of intangible assets 6,336 0.6 % 5,079 736 0.5 % (0.1 )% Impairment of goodwill 6,171 0.6 % 9,515 1,380 0.9 % 0.3 % Total costs and expenses 856,203 975,368 141,399 Share-based compensation expense: Cost of revenue 2,162 0.2 % 2,023 293 0.2 % 0.0 % Product development expenses 6,700 0.7 % 6,016 872 0.6 % (0.1 )% Sales and marketing expenses 2,137 0.2 % 2,321 337 0.2 % 0.0 % General and administrative expenses 4,578 0.5 % 4,461 647 0.4 % (0.1 )% Total share-based compensation expense(1) 15,577 14,821 2,149 Costs and expenses excluding share-based compensation expense: Cost of revenue 596,123 59.8 % 614,113 89,028 60.0 % 0.2 % Product development expenses 50,451 5.1 % 60,517 8,773 5.9 % 0.8 % Sales and marketing expenses 141,884 14.2 % 242,702 35,184 23.7 % 9.5 % General and administrative expenses 39,661 4.0 % 28,621 4,149 2.8 % (1.2 )% Amortization and impairment of intangible assets 6,336 0.6 % 5,079 736 0.5 % (0.1 )% Impairment of goodwill 6,171 0.6 % 9,515 1,380 0.9 % 0.3 % Total costs and expenses excluding share-based compensation expense 840,626 960,547 139,250 ____________________ (1) This includes both cash and non-cash share-based compensation expenses. Cost of revenue – Cost of revenue in fiscal year 2026 was RMB616,136 million (US$89,321 million), or 60.2% of revenue, compared to RMB598,285 million, or 60.0% of revenue, in fiscal year 2025. Without the effect of share-based compensation expense, cost of revenue as a percentage of revenue would have increased from 59.8% in fiscal year 2025 to 60.0% in fiscal year 2026, primarily driven by our expansion in quick commerce business, and the growth in our cloud and technology businesses, partly offset by the disposal of Sun Art and Intime businesses, improvement in monetization and operating efficiency. Product development expenses – Product development expenses in fiscal year 2026 were RMB66,533 million (US$9,645 million), or 6.5% of revenue, compared to RMB57,151 million, or 5.7% of revenue, in fiscal year 2025. Without the effect of share-based compensation expense, product development expenses as a percentage of revenue would have increased from 5.1% in fiscal year 2025 to 5.9% in fiscal year 2026. Sales and marketing expenses – Sales and marketing expenses in fiscal year 2026 were RMB245,023 million (US$35,521 million), or 23.9% of revenue, compared to RMB144,021 million, or 14.5% of revenue, in fiscal year 2025. Without the effect of share-based compensation expense, sales and marketing expenses as a percentage of revenue would have increased from 14.2% in fiscal year 2025 to 23.7% in fiscal year 2026, primarily attributable to the investment in user experiences of Alibaba China E-commerce Group and user acquisition of Qwen app. General and administrative expenses – General and administrative expenses in fiscal year 2026 were RMB33,082 million (US$4,796 million), or 3.2% of revenue, compared to RMB44,239 million, or 4.4% of revenue, in fiscal year 2025. Without the effect of share-based compensation expense, general and administrative expenses as a percentage of revenue would have decreased from 4.0% in fiscal year 2025 to 2.8% in fiscal year 2026, primarily due to a one-time provision for the shareholder class action lawsuits in fiscal year 2025 and our enhanced cost control measures. Share-based compensation expense – Total share-based compensation expense included in the cost and expense items above in fiscal year 2026 was RMB14,821 million (US$2,149 million), compared to RMB15,577 million in fiscal year 2025. The following table sets forth our analysis of share-based compensation expense for the periods indicated by type of share-based awards: Year ended March 31, 2025 2026 RMB RMB US$ YoY %
Change (in millions, except percentages) By type of awards: Alibaba Group share-based awards(1) 11,121 9,146 1,326 (18 )% Others(2) 4,456 5,675 823 27 % Total share-based compensation expense(3) 15,577 14,821 2,149 (5 )% ____________________ (1) This represents Alibaba Group share-based awards granted to our employees. (2) This represents share-based awards of our subsidiaries and Ant Group granted to our employees. (3) This includes both cash and non-cash share-based compensation expenses. Share-based compensation expense decreased in fiscal year 2026 compared to fiscal year 2025. The decrease was primarily due to the decrease in the number of awards granted as we have increased the proportion of long-term cash incentives granted after considering the macroeconomic environment and the general trends in the talent market. We expect that our share-based compensation expense will continue to be affected by changes in the fair value of the underlying awards and the quantity of awards we grant in the future. Amortization and impairment of intangible assets – Amortization and impairment of intangible assets in fiscal year 2026 was RMB5,079 million (US$736 million), a decrease of 20% from RMB6,336 million in fiscal year 2025, primarily due to the full amortization of certain intangible assets, partly offset by the increase in impairment. Impairment of goodwill – Impairment of goodwill in fiscal year 2026 was RMB9,515 million (US$1,380 million), an increase of 54% from RMB6,171 million in fiscal year 2025, both of which are related to All others segment. Income from operations and operating margin Income from operations in fiscal year 2026 was RMB50,150 million (US$7,270 million), or 5% of revenue, a decrease of 64% compared to RMB140,905 million, or 14% of revenue, in fiscal year 2025, primarily due to the decrease in adjusted EBITA and increase in impairment of goodwill, partly offset by the decrease in one-time provisions and non-cash share-based expenses. Adjusted EBITDA and Adjusted EBITA Adjusted EBITDA decreased 44% year-over-year to RMB113,483 million (US$16,452 million) in fiscal year 2026, compared to RMB202,325 million in fiscal year 2025. Adjusted EBITA decreased 56% year-over-year to RMB76,416 million (US$11,078 million) in fiscal year 2026, compared to RMB173,065 million in fiscal year 2025, primarily attributable to the investment in quick commerce, user experiences, and technology businesses, partly offset by the improved operating results supported by continued growth in customer management service and Cloud business, as well as enhanced operating efficiencies across various businesses. A reconciliation of net income to adjusted EBITDA and adjusted EBITA is included at the end of this results announcement. Adjusted EBITA by segment Adjusted EBITA by segment as well as a reconciliation of income from operations to adjusted EBITA are set forth in the section entitled “Full Fiscal Year Segment Results” above. Interest and investment income, net Interest and investment income, net in fiscal year 2026 was RMB87,512 million (US$12,687 million), an increase of 322% compared to RMB20,759 million in fiscal year 2025, primarily due to the year-over-year increase in net gain from mark-to-market changes of our equity investments, as well as net gains from disposal of investments, including local consumer service business of Trendyol in fiscal year 2026, compared to losses on disposal of Sun Art and Intime in fiscal year 2025. The above-mentioned investment gains and losses were excluded from our non-GAAP net income. Other income, net Other income, net in fiscal year 2026 was RMB1,518 million (US$220 million), a decrease of 55% compared to RMB3,387 million in fiscal year 2025, primarily due to the increase in net exchange loss, arising from the exchange rate fluctuation between Renminbi and U.S. dollar. Income tax expenses Income tax expenses in fiscal year 2026 were RMB30,045 million (US$4,356 million), compared to RMB35,445 million in fiscal year 2025. Share of results of equity method investees Share of results of equity method investees in fiscal year 2026 was RMB2,785 million (US$404 million), a decrease of 53% compared to RMB5,966 million in fiscal year 2025. The following table sets forth a breakdown of share of results of equity method investees for the periods indicated: Year ended March 31, 2025 2026 RMB RMB US$ (in millions) Share of profit (loss) of equity method investees - Ant Group 12,648 5,048 732 - Others (2,276 ) 1,624 235 Impairment loss (2,723 ) (15 ) (2 ) Others(1) (1,683 ) (3,872 ) (561 ) Total 5,966 2,785 404 ____________________ (1) “Others” mainly include basis differences arising from equity method investees, share-based compensation expense related to share-based awards granted to employees of our equity method investees, as well as gain or loss arising from the deemed disposal of the equity method investees. We record our share of results of all equity method investees one quarter in arrears. The year-over-year decrease in share of profit of Ant Group was mainly attributable to the increase in investments in new growth initiatives, including user growth, and technologies. Net income and Non-GAAP net income Our net income in fiscal year 2026 was RMB102,127 million (US$14,805 million), compared to RMB125,976 million in fiscal year 2025, primarily attributable to the decrease in income from operations, partly offset by the year-over-year increase in net gain from mark-to-market changes of our equity investments, as well as net gains from disposal of investments, including local consumer service business of Trendyol in fiscal year 2026, compared to losses on disposal of Sun Art and Intime in fiscal year 2025. Excluding non-cash share-based compensation expense, gains/losses of investments, impairment of goodwill and intangible assets, and certain other items, non-GAAP net income in fiscal year 2026 was RMB60,658 million (US$8,794 million), a decrease of 62% compared to RMB158,122 million in fiscal year 2025, primarily attributable to the investment in quick commerce, user experiences, and technology businesses, partly offset by the improved operating results supported by continued growth in customer management service and Cloud business, as well as enhanced operating efficiencies across various businesses. A reconciliation of net income to non-GAAP net income is included at the end of this results announcement. Net income attributable to ordinary shareholders Net income attributable to ordinary shareholders in fiscal year 2026 was RMB105,904 million (US$15,353 million), compared to RMB129,470 million in fiscal year 2025, primarily attributable to the decrease in income from operations, partly offset by the year-over-year increase in net gain from mark-to-market changes of our equity investments, as well as net gains from disposal of investments, including local consumer service business of Trendyol in fiscal year 2026, compared to losses on disposal of Sun Art and Intime in fiscal year 2025. Diluted earnings per ADS/share and non-GAAP diluted earnings per ADS/share Diluted earnings per ADS in fiscal year 2026 was RMB44.00 (US$6.38), compared to RMB53.59 in fiscal year 2025. Excluding non-cash share-based compensation expense, gains/losses of investments, impairment of goodwill and intangible assets, and certain other items, non-GAAP diluted earnings per ADS in fiscal year 2026 was RMB26.80 (US$3.89), a decrease of 59% compared to RMB65.41 in fiscal year 2025. Diluted earnings per share in fiscal year 2026 was RMB5.50 (US$0.80 or HK$6.23), compared to RMB6.70 in fiscal year 2025. Excluding non-cash share-based compensation expense, gains/losses of investments, impairment of goodwill and intangible assets, and certain other items, non-GAAP diluted earnings per share in fiscal year 2026 was RMB3.35 (US$0.49 or HK$3.79), a decrease of 59% compared to RMB8.18 in fiscal year 2025. A reconciliation of diluted earnings per ADS/share to non-GAAP diluted earnings per ADS/share is included at the end of this results announcement. Each ADS represents eight ordinary shares. Cash and cash equivalents, short-term investments and other treasury investments As of March 31, 2026, cash and cash equivalents, short-term investments and other treasury investments included in equity securities and other investments on the consolidated balance sheets, of which that are unrestricted for withdrawal and use, were RMB520,824 million (US$75,504 million), compared to RMB597,132 million as of March 31, 2025. Other treasury investments consist of fixed deposits, certificates of deposit and marketable debt securities with original maturities over one year for treasury purposes. The decrease of RMB76,308 million during the year ended March 31, 2026, was primarily due to (i) free cash flow outflow of RMB46,609 million (US$6,757 million), (ii) dividend payment of RMB33,732 million (US$4,890 million), (iii) acquisition of additional equity interests in non-wholly owned subsidiaries of RMB16,768 million (US$2,431 million), (iv) effect of exchange rate changes of RMB13,375 million (US$1,939 million) mainly due to the depreciation of the U.S. dollar against Renminbi, partly offset by (v) the net proceeds from issuance of convertible unsecured senior notes and the payments for capped call transactions of RMB20,967 million (US$3,040 million) and (vi) the net proceeds from issuance of exchangeable bonds of RMB10,986 million (US$1,593 million). Net cash provided by operating activities and free cash flow Net cash provided by operating activities in fiscal year 2026 was RMB76,213 million (US$11,049 million), a decrease of 53% compared to RMB163,509 million in fiscal year 2025. Free cash flow, a non-GAAP measurement of liquidity, was an outflow of RMB46,609 million (US$6,757 million), compared to an inflow of RMB73,870 million in fiscal year 2025. The decrease in free cash flow was mainly attributed to the investment in quick commerce and increase in our cloud infrastructure expenditure. A reconciliation of net cash provided by operating activities to free cash flow is included at the end of this results announcement. Net cash used in investing activities During fiscal year 2026, net cash used in investing activities of RMB67,336 million (US$9,762 million) primarily reflected capital expenditures of RMB126,063 million (US$18,275 million), partly offset by a net decrease in short-term investments and other treasury investments by RMB29,548 million (US$4,284 million) and net cash inflow of RMB29,045 million (US$4,211 million) from investment and acquisition activities. Net cash used in financing activities During fiscal year 2026, net cash used in financing activities of RMB20,573 million (US$2,983 million) primarily reflected dividend payment of RMB33,732 million (US$4,890 million) and acquisition of additional equity interests in non-wholly owned subsidiaries of RMB16,768 million (US$2,431 million), partly offset by the net proceeds from issuance of convertible unsecured senior notes and the payments for capped call transactions of RMB20,967 million (US$3,040 million) and the net proceeds from issuance of exchangeable bonds of RMB10,986 million (US$1,593 million). Employees As of March 31, 2026, we had a total of 131,462 employees, compared to 124,320 as of March 31, 2025. WEBCAST AND CONFERENCE CALL INFORMATION Alibaba Group’s management will hold a conference call to discuss the financial results at 7:30 a.m. U.S. Eastern Time (7:30 p.m. Hong Kong Time) on Wednesday, May 13, 2026. All participants must pre-register to join this conference call using the Participant Registration link below:
English: https://s1.c-conf.com/diamondpass/10054382-np98b5.html
Chinese: https://s1.c-conf.com/diamondpass/10054384-cn23b5.html Upon registration, each participant will receive details for the conference call, including dial-in numbers, conference call passcode and a unique access PIN. To join the conference, please dial the number provided, enter the passcode followed by your PIN, and you will join the conference. A live webcast of the earnings conference call can be accessed at https://www.alibabagroup.com/en/ir/earnings. An archived webcast will be available through the same link following the call. A replay of the conference call will be available for one week from the date of the conference (Dial-in number: +1 855 883 1031; English conference PIN 10054382; Chinese conference PIN 10054384). Please visit Alibaba Group’s Investor Relations website at https://www.alibabagroup.com/en/ir/home on May 13, 2026 to view the earnings release and accompanying slides prior to the conference call. ABOUT ALIBABA GROUP Alibaba Group is a global technology company focused on e-commerce and cloud computing. We enable merchants, brands and retailers to market, sell and engage with consumers by providing digital and logistics infrastructure, efficiency tools and vast marketing reach. We empower enterprises with our leading cloud infrastructure, services and work collaboration capabilities to facilitate their digital transformation and grow their businesses. EXCHANGE RATE INFORMATION This results announcement contains translations of certain Renminbi (“RMB”) amounts into U.S. dollars (“US$”) and Hong Kong dollars (“HK$”) for the convenience of the reader. Unless otherwise stated, all translations of RMB into US$ were made at RMB6.8980 to US$1.00, the exchange rate on March 31, 2026 as set forth in the H.10 statistical release of the Federal Reserve Board, and all translations of RMB into HK$ were made at RMB0.88295 to HK$1.00, the middle rate on March 31, 2026 as published by the People’s Bank of China. The percentages stated in this announcement are calculated based on the RMB amounts and there may be minor differences due to rounding. SAFE HARBOR STATEMENTS This results announcement contains forward-looking statements. These statements are made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as “may,” “will,” “expect,” “anticipate,” “future,” “aim,” “estimate,” “intend,” “seek,” “plan,” “believe,” “potential,” “continue,” “ongoing,” “target,” “guidance,” “is/are likely to” and similar statements. In addition, statements that are not historical facts, including statements about Alibaba’s strategies and business and operational plans, Alibaba’s beliefs, expectations and guidance regarding the growth of its business, its operating and financial results, return on investments, strategic investments and dispositions and share repurchases, and the business outlook and quotations from management in this results announcement, are or contain forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to: Alibaba’s ability to compete, innovate and maintain or grow its business; risks associated with sustained investments in Alibaba’s businesses; risks related to strategic transactions; fluctuations in general economic and business conditions in China and globally; uncertainties arising from competition among countries and geopolitical tensions, including national trade, investment, protectionist or other policies and export control, economic or trade sanctions; changes to our shareholder return initiatives; and assumptions underlying or related to any of the foregoing. Further information regarding these and other risks is included in Alibaba’s filings with the U.S. Securities and Exchange Commission and announcements on the website of The Stock Exchange of Hong Kong Limited. All information provided in this results announcement is as of the date of this results announcement and are based on assumptions that we believe to be reasonable as of this date, and Alibaba does not undertake any obligation to update any forward-looking statement, except as required under applicable law. NON-GAAP FINANCIAL MEASURES To supplement our consolidated financial statements, which are prepared and presented in accordance with GAAP, we use the following non-GAAP financial measures: for our consolidated results, adjusted EBITDA (including adjusted EBITDA margin), adjusted EBITA (including adjusted EBITA margin), non-GAAP net income, non-GAAP diluted earnings per share/ADS and free cash flow. For more information on these non-GAAP financial measures, please refer to the table captioned “Reconciliations of Non-GAAP Measures to the Nearest Comparable U.S. GAAP Measures” in this results announcement. We believe that adjusted EBITDA, adjusted EBITA, non-GAAP net income and non-GAAP diluted earnings per share/ADS help identify underlying trends in our business that could otherwise be distorted by the effect of certain income or expenses that we include in income from operations, net income and diluted earnings per share/ADS. We believe that these non-GAAP measures provide useful information about our core operating results, enhance the overall understanding of our past performance and future prospects and allow for greater visibility with respect to key metrics used by our management in its financial and operational decision-making. We present three different income measures, namely adjusted EBITDA, adjusted EBITA and non-GAAP net income in order to provide more information and greater transparency to investors about our operating results. We consider free cash flow to be a liquidity measure that provides useful information to management and investors about the amount of cash generated by our business that can be used for strategic corporate transactions, including investing in our new business initiatives, making strategic investments and acquisitions and strengthening our balance sheet. Adjusted EBITDA, adjusted EBITA, non-GAAP net income, non-GAAP diluted earnings per share/ADS and free cash flow should not be considered in isolation or construed as an alternative to income from operations, net income, diluted earnings per share/ADS, cash flows or any other measure of performance or as an indicator of our operating performance. These non-GAAP financial measures presented here do not have standardized meanings prescribed by U.S. GAAP and may not be comparable to similarly titled measures presented by other companies. Other companies may calculate similarly titled measures differently, limiting their usefulness as comparative measures to our data. Adjusted EBITDA represents net income before interest and investment income, net, interest expense, other income (expense), net, income tax expenses, share of results of equity method investees, certain non-cash expenses, consisting of share-based compensation expense, amortization and impairment of intangible assets, impairment of goodwill, depreciation and impairment of property and equipment, and operating lease cost relating to land use rights, and others (including provision in relation to matters outside the ordinary course of business), which we do not believe are reflective of our core operating performance during the periods presented. Adjusted EBITA represents net income before interest and investment income, net, interest expense, other income (expense), net, income tax expenses, share of results of equity method investees, certain non-cash expenses, consisting of share-based compensation expense, amortization and impairment of intangible assets, impairment of goodwill, and others (including provision in relation to matters outside the ordinary course of business), which we do not believe are reflective of our core operating performance during the periods presented. Non-GAAP net income represents net income before non-cash share-based compensation expense, amortization and impairment of intangible assets, gain or loss on deemed disposals/disposals/revaluation of investments, impairment of goodwill and investments, and others (including provision in relation to matters outside the ordinary course of business), and adjustments for the tax effects. Non-GAAP diluted earnings per share represents non-GAAP net income attributable to ordinary shareholders divided by the weighted average number of outstanding ordinary shares, in each case for computing non-GAAP diluted earnings per share on a diluted basis. Non-GAAP diluted earnings per ADS represents non-GAAP diluted earnings per share after adjusting for the ordinary share-to-ADS ratio. Free cash flow represents net cash provided by operating activities as presented in our consolidated cash flow statement less purchases of property and equipment (excluding acquisition of land use rights and construction in progress relating to office campuses) and intangible assets (excluding those acquired through acquisitions), as well as adjustments to exclude from net cash provided by operating activities the buyer protection fund deposits from merchants on our marketplaces. We deduct certain items of cash flows from investing activities in order to provide greater transparency into cash flow from our revenue-generating business operations. We exclude “acquisition of land use rights and construction in progress relating to office campuses” because the office campuses are used by us for corporate and administrative purposes and are not directly related to our revenue-generating business operations. We also exclude buyer protection fund deposits from merchants on our marketplaces because these deposits are restricted for the purpose of compensating buyers for claims against merchants. The table captioned “Reconciliations of Non-GAAP Measures to the Nearest Comparable U.S. GAAP Measures” in this results announcement has more details on the non-GAAP financial measures that are most directly comparable to GAAP financial measures and the related reconciliations between these financial measures. ALIBABA GROUP HOLDING LIMITED UNAUDITED CONSOLIDATED INCOME STATEMENTS Three months ended March 31, Year ended March 31, 2025 2026 2025 2026 RMB RMB US$ RMB RMB US$ (in millions, except per share data) (in millions, except per share data) Revenue 236,454 243,380 35,283 996,347 1,023,670 148,401 Cost of revenue (145,626 ) (159,392 ) (23,107 ) (598,285 ) (616,136 ) (89,321 ) Product development expenses (14,934 ) (18,957 ) (2,748 ) (57,151 ) (66,533 ) (9,645 ) Sales and marketing expenses (36,179 ) (53,415 ) (7,744 ) (144,021 ) (245,023 ) (35,521 ) General and administrative expenses (10,331 ) (9,949 ) (1,442 ) (44,239 ) (33,082 ) (4,796 ) Amortization and impairment of intangible assets (833 ) (2,605 ) (378 ) (6,336 ) (5,079 ) (736 ) Impairment of goodwill – – – (6,171 ) (9,515 ) (1,380 ) Other (losses) gains, net (86 ) 90 13 761 1,848 268 Income (Loss) from operations 28,465 (848 ) (123 ) 140,905 50,150 7,270 Interest and investment income, net (7,516 ) 33,823 4,903 20,759 87,512 12,687 Interest expense (2,496 ) (2,241 ) (325 ) (9,596 ) (9,793 ) (1,420 ) Other income, net 20 623 91 3,387 1,518 220 Income before income tax and share of results of equity method investees 18,473 31,357 4,546 155,455 129,387 18,757 Income tax expenses (6,854 ) (7,170 ) (1,040 ) (35,445 ) (30,045 ) (4,356 ) Share of results of equity method investees 354 (685 ) (99 ) 5,966 2,785 404 Net income 11,973 23,502 3,407 125,976 102,127 14,805 Net loss attributable to noncontrolling interests 586 2,039 296 4,133 1,465 213 Net income attributable to Alibaba Group Holding Limited 12,559 25,541 3,703 130,109 103,592 15,018 (Accretion) Reversal of accretion of mezzanine equity (177 ) (65 ) (10 ) (639 ) 2,312 335 Net income attributable to ordinary shareholders 12,382 25,476 3,693 129,470 105,904 15,353 Earnings per share attributable to ordinary shareholders(1) Basic 0.67 1.37 0.20 6.89 5.70 0.83 Diluted 0.65 1.30 0.19 6.70 5.50 0.80 Earnings per ADS attributable to ordinary shareholders(1) Basic 5.36 10.97 1.59 55.12 45.63 6.61 Diluted 5.17 10.36 1.50 53.59 44.00 6.38 Weighted average number of shares used in calculating earnings per ordinary share (million shares)(1) Basic 18,487 18,579 18,791 18,568 Diluted 19,153 19,319 19,318 19,235 ____________________ (1) Each ADS represents eight ordinary shares. ALIBABA GROUP HOLDING LIMITED UNAUDITED CONSOLIDATED BALANCE SHEETS As of March 31, As of March 31, 2025 2026 RMB RMB US$ (in millions) Assets Current assets: Cash and cash equivalents 145,487 131,530 19,068 Short-term investments 228,826 155,310 22,515 Restricted cash and escrow receivables 43,781 42,038 6,094 Equity securities and other investments 53,780 30,054 4,357 Prepayments, receivables and other assets 202,175 251,837 36,509 Total current assets 674,049 610,769 88,543 Equity securities and other investments 356,818 449,942 65,228 Prepayments, receivables and other assets 83,431 94,996 13,772 Investment in equity method investees 210,169 206,803 29,980 Property and equipment, net 203,348 282,699 40,983 Intangible assets, net 20,911 16,983 2,462 Goodwill 255,501 247,378 35,862 Total assets 1,804,227 1,909,570 276,830 Liabilities, Mezzanine Equity and Shareholders’ Equity Current liabilities: Current bank borrowings 22,562 28,224 4,092 Income tax payable 11,638 10,630 1,541 Accrued expenses, accounts payable and other liabilities 332,537 359,893 52,173 Merchant deposits 274 236 34 Deferred revenue and customer advances 68,335 77,415 11,223 Total current liabilities 435,346 476,398 69,063 ALIBABA GROUP HOLDING LIMITED UNAUDITED CONSOLIDATED BALANCE SHEETS (CONTINUED) As of March 31, As of March 31, 2025 2026 RMB RMB US$ (in millions) Deferred revenue 4,536 4,885 708 Deferred tax liabilities 48,454 46,060 6,678 Non-current bank borrowings 49,909 47,450 6,879 Non-current unsecured senior notes 122,398 117,485 17,032 Non-current convertible unsecured senior notes 35,834 55,861 8,098 Non-current exchangeable bonds – 10,976 1,591 Other liabilities 17,644 24,185 3,506 Total liabilities 714,121 783,300 113,555 Commitments and contingencies Mezzanine equity 11,713 7,845 1,137 Shareholders’ equity: Ordinary shares 1 1 – Additional paid-in capital 381,379 385,086 55,826 Treasury shares at cost (36,329 ) (36,141 ) (5,239 ) Statutory reserves 15,936 16,628 2,410 Accumulated other comprehensive income (loss) 3,393 (13,070 ) (1,895 ) Retained earnings 645,478 708,382 102,694 Total shareholders’ equity 1,009,858 1,060,886 153,796 Noncontrolling interests 68,535 57,539 8,342 Total equity 1,078,393 1,118,425 162,138 Total liabilities, mezzanine equity and equity 1,804,227 1,909,570 276,830 ALIBABA GROUP HOLDING LIMITED UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS Three months ended March 31, Year ended March 31, 2025 2026 2025 2026 RMB RMB US$ RMB RMB US$ (in millions) (in millions) Net cash provided by operating activities 27,520 9,410 1,364 163,509 76,213 11,049 Net cash (used in) provided by investing activities (39,547 ) 9,704 1,407 (185,415 ) (67,336 ) (9,762 ) Net cash used in financing activities (4,102 ) (15,002 ) (2,175 ) (76,215 ) (20,573 ) (2,983 ) Effect of exchange rate changes on cash and cash equivalents, restricted cash and escrow receivables (569 ) (1,063 ) (154 ) 965 (4,004 ) (580 ) (Decrease) Increase in cash and cash equivalents, restricted cash and escrow receivables (16,698 ) 3,049 442 (97,156 ) (15,700 ) (2,276 ) Cash and cash equivalents, restricted cash and escrow receivables at beginning of period 205,966 170,519 24,720 286,424 189,268 27,438 Cash and cash equivalents, restricted cash and escrow receivables at end of period 189,268 173,568 25,162 189,268 173,568 25,162 ALIBABA GROUP HOLDING LIMITED RECONCILIATIONS OF NON-GAAP MEASURES TO THE NEAREST COMPARABLE U.S. GAAP MEASURES The table below sets forth a reconciliation of our net income to adjusted EBITA and adjusted EBITDA for the periods indicated: Three months ended March 31, Year ended March 31, 2025 2026 2025 2026 RMB RMB US$ RMB RMB US$ (in millions) (in millions) Net income 11,973 23,502 3,407 125,976 102,127 14,805 Adjustments to reconcile net income to adjusted EBITA and adjusted EBITDA: Interest and investment income, net 7,516 (33,823 ) (4,903 ) (20,759 ) (87,512 ) (12,687 ) Interest expense 2,496 2,241 325 9,596 9,793 1,420 Other income, net (20 ) (623 ) (91 ) (3,387 ) (1,518 ) (220 ) Income tax expenses 6,854 7,170 1,040 35,445 30,045 4,356 Share of results of equity method investees (354 ) 685 99 (5,966 ) (2,785 ) (404 ) Income (Loss) from operations 28,465 (848 ) (123 ) 140,905 50,150 7,270 Non-cash share-based compensation expense 2,781 2,708 393 13,970 11,180 1,621 Amortization and impairment of intangible assets 833 2,605 378 6,336 5,079 736 Impairment of goodwill, and others 537 637 92 11,854 10,007 1,451 Adjusted EBITA 32,616 5,102 740 173,065 76,416 11,078 Depreciation and impairment of property and equipment, and operating lease cost relating to land use rights 9,167 11,333 1,643 29,260 37,067 5,374 Adjusted EBITDA 41,783 16,435 2,383 202,325 113,483 16,452 ALIBABA GROUP HOLDING LIMITED RECONCILIATIONS OF NON-GAAP MEASURES TO THE NEAREST COMPARABLE U.S. GAAP MEASURES (CONTINUED) The table below sets forth a reconciliation of our net income to non-GAAP net income for the periods indicated: Three months ended March 31, Year ended March 31, 2025 2026 2025 2026 RMB RMB US$ RMB RMB US$ (in millions) (in millions) Net income 11,973 23,502 3,407 125,976 102,127 14,805 Adjustments to reconcile net income to non-GAAP net income: Non-cash share-based compensation expense 2,781 2,708 393 13,970 11,180 1,621 Amortization and impairment of intangible assets 833 2,605 378 6,336 5,079 736 Loss (Gain) on deemed disposals/disposals/revaluation of investments 12,306 (30,827 ) (4,469 ) (8,764 ) (74,416 ) (10,788 ) Impairment of goodwill and investments, and others 897 2,161 313 22,435 17,746 2,573 Tax effects(1) 1,057 (63 ) (10 ) (1,831 ) (1,058 ) (153 ) Non-GAAP net income 29,847 86 12 158,122 60,658 8,794 ____________________ (1) Tax effects primarily comprise tax effects relating to non-cash share-based compensation expense, amortization and impairment of intangible assets and certain gains and losses from investments, and others. ALIBABA GROUP HOLDING LIMITED RECONCILIATIONS OF NON-GAAP MEASURES TO THE NEAREST COMPARABLE U.S. GAAP MEASURES (CONTINUED) The table below sets forth a reconciliation of our diluted earnings per share/ADS to non-GAAP diluted earnings per share/ADS for the periods indicated: Three months ended March 31, Year ended March 31, 2025 2026 2025 2026 RMB RMB US$ RMB RMB US$ (in millions, except per share data) (in millions, except per share data) Net income attributable to ordinary shareholders – basic 12,382 25,476 3,693 129,470 105,904 15,353 Dilution effect on earnings arising from non-cash share-based awards operated by equity method investees and subsidiaries (82 ) (86 ) (12 ) (300 ) (410 ) (59 ) Adjustments for interest expense attributable to convertible unsecured senior notes 70 82 12 235 309 45 Dilution effect on earnings arising from assumed exchange of exchangeable bonds – (453 ) (66 ) – – – Net income attributable to ordinary shareholders – diluted 12,370 25,019 3,627 129,405 105,803 15,339 Non-GAAP adjustments to net income attributable to ordinary shareholders(1) 17,610 (23,513 ) (3,409 ) 28,535 (41,365 ) (5,997 ) Non-GAAP net income attributable to ordinary shareholders for computing non-GAAP diluted earnings per share/ADS 29,980 1,506 218 157,940 64,438 9,342 Weighted average number of shares on a diluted basis for computing non-GAAP diluted earnings per share/ADS (million shares)(2) 19,153 19,319 19,318 19,235 Diluted earnings per share(2)(3) 0.65 1.30 0.19 6.70 5.50 0.80 Non-GAAP diluted earnings per share(2)(4) 1.57 0.08 0.01 8.18 3.35 0.49 Diluted earnings per ADS(2)(3) 5.17 10.36 1.50 53.59 44.00 6.38 Non-GAAP diluted earnings per ADS(2)(4) 12.52 0.62 0.09 65.41 26.80 3.89 ____________________ (1) Non-GAAP adjustments exclude the attributions to the noncontrolling interests for computing non-GAAP diluted earnings per share/ADS. See the table above for items regarding the reconciliation of net income to non-GAAP net income (before taking into account the dilutive impact and excluding the attributions to the noncontrolling interests). (2) Each ADS represents eight ordinary shares. (3) Diluted earnings per share is derived from dividing net income attributable to ordinary shareholders by the weighted average number of outstanding ordinary shares, on a diluted basis. Diluted earnings per ADS is derived from the diluted earnings per share after adjusting for the ordinary share-to-ADS ratio. (4) Non-GAAP diluted earnings per share is derived from dividing non-GAAP net income attributable to ordinary shareholders by the weighted average number of outstanding ordinary shares, in each case for computing non-GAAP diluted earnings per share. Non-GAAP diluted earnings per ADS is derived from the non-GAAP diluted earnings per share after adjusting for the ordinary share-to-ADS ratio. ALIBABA GROUP HOLDING LIMITED RECONCILIATIONS OF NON-GAAP MEASURES TO THE NEAREST COMPARABLE U.S. GAAP MEASURES (CONTINUED) The table below sets forth a reconciliation of net cash provided by operating activities to free cash flow for the periods indicated: Three months ended March 31, Year ended March 31, 2025 2026 2025 2026 RMB RMB US$ RMB RMB US$ (in millions) (in millions) Net cash provided by operating activities 27,520 9,410 1,364 163,509 76,213 11,049 Less: Purchase of property and equipment (excluding land use rights and construction in progress relating to office campuses) (23,993 ) (26,588 ) (3,854 ) (84,278 ) (122,021 ) (17,689 ) Less: Purchase of intangible assets (excluding those acquired through acquisitions) – (874 ) (127 ) – (874 ) (127 ) Less: Changes in the buyer protection fund deposits 216 752 109 (5,361 ) 73 10 Free cash flow 3,743 (17,300 ) (2,508 ) 73,870 (46,609 ) (6,757 ) View source version on businesswire.com: https://www.businesswire.com/news/home/20260512841182/en/ Investor Relations Contact
Lydia Liu
Head of Investor Relations
Alibaba Group Holding Limited
investor@alibaba-inc.com Media Contacts
Cathy Yan
cathy.yan@alibaba-inc.com Ivy Ke
ivy.ke@alibaba-inc.com Original: Alibaba Group Announces March Quarter 2026 and Fiscal Year 2026 Results
US Market News
4月前
Alibaba Group Announces December Quarter 2025 ResultsMarch 19, 2026 5:30 AM
Business Wire
Alibaba Group Holding Limited (NYSE: BABA and HKEX: 9988 (HKD Counter) and 89988 (RMB Counter), “Alibaba” or “Alibaba Group”) today announced its financial results for the quarter ended December 31, 2025.
“This quarter, Alibaba maintained strong investments across our core pillars of AI and consumption. AI is and will continue to be one of our primary growth engines. Our Cloud Intelligence Group’s revenue is up 36% with AI-related product revenue delivering triple-digit growth for the tenth consecutive quarter. Our Model-as-a-Service (MaaS) platform is showing strong growth, emerging as a new engine driving cloud business growth. On the consumer side, we have integrated use cases across our consumer ecosystem into Qwen app, which generated significant new users and transactions. Qwen’s consumer interface surpassed 300 million monthly active users, as AI agents perform real-world task execution at scale. Looking ahead, we are well-positioned to drive growth on both enterprise AI and consumer AI fronts, powered by our full-stack AI capabilities spanning foundation models, cloud infrastructure, and proprietary chips, alongside deep integration with our broader ecosystem,” said Eddie Wu, Chief Executive Officer of Alibaba Group.
“The rapid growth of AI + Cloud businesses in recent quarters gives us confidence to scale investments, further strengthening our full-stack AI capabilities. In consumption, our quick commerce business continues to scale while unit economics improved steadily. Our strong liquidity position and resilient cash generation provide a solid foundation to support sustained strategic investment,” said Toby Xu, Chief Financial Officer of Alibaba Group.
BUSINESS HIGHLIGHTS
In the quarter ended December 31, 2025:
Revenue was RMB284,843 million (US$40,732 million), an increase of 2% year-over-year. Excluding revenue from the disposed businesses of Sun Art and Intime, revenue on a like-for-like basis would have grown by 9% year-over-year.
Income from operations was RMB10,645 million (US$1,522 million), a decrease of 74% year-over-year, primarily due to the decrease in adjusted EBITA. Adjusted EBITA, a non-GAAP measurement, decreased 57% year-over-year to RMB23,397 million (US$3,346 million), primarily attributable to the investment in quick commerce, user experiences, and technology, partly offset by the improved operating results supported by continued growth in Cloud business, as well as enhanced operating efficiencies across various businesses.
Net income attributable to ordinary shareholders was RMB16,322 million (US$2,334 million). Net income was RMB15,631 million (US$2,235 million), a decrease of 66% year-over-year, primarily attributable to the decrease in income from operations. Non-GAAP net income in the quarter ended December 31, 2025 was RMB16,710 million (US$2,389 million), a decrease of 67% compared to RMB51,066 million in the same quarter of 2024.
Diluted earnings per ADS was RMB5.93 (US$0.85). Diluted earnings per share was RMB0.74 (US$0.11 or HK$0.82). Non-GAAP diluted earnings per ADS was RMB7.09 (US$1.01), a decrease of 67% year-over-year. Non-GAAP diluted earnings per share was RMB0.89 (US$0.13 or HK$0.98), a decrease of 67% year-over-year.
Net cash provided by operating activities was RMB36,032 million (US$5,152 million), a decrease of 49% compared to RMB70,915 million in the same quarter of 2024. Free cash flow, a non-GAAP measurement of liquidity, was RMB11,346 million (US$1,622 million), a decrease of 71% compared to RMB39,020 million in the same quarter of 2024. The decrease in free cash flow was mainly attributed to the investment in quick commerce. As of December 31, 2025, our cash and other liquid investments(1) were RMB560,175 million (US$80,104 million).
Reconciliations of GAAP measures to non-GAAP measures presented above are included at the end of this results announcement.
____________
(1)
Cash and other liquid investments represent cash and cash equivalents, short-term investments and other treasury investments included in equity securities and other investments on the consolidated balance sheets, of which that are unrestricted for withdrawal and use.
BUSINESS AND STRATEGIC UPDATES
Consumption Businesses
Alibaba China E-commerce Group
During the quarter, we executed our plan to further grow the scale of our quick commerce business, improve user experience and enhance operating efficiency, with increasing efforts in high-value food orders and non-food categories. The quick commerce business continued to improve unit economics and increase average order value month-over-month during the quarter, driven by fulfillment logistics efficiency enhancement, order mix optimization, and strong customer retention.
We rebranded “Ele.me” to “Taobao Instant Commerce” during the quarter, to closely align it with the Taobao app and strengthen our branding. In addition, Taobao Instant Commerce service was integrated into Qwen app on January 15, 2026, which further expands its customer reach and better meets diverse user needs.
Customer management revenue grew 1% year-over-year to RMB102,664 million (US$14,681 million) during the quarter. The slow-down in revenue growth was primarily due to weaker transaction activities and phase-out of the impact of software service fee implementation. The Taobao app achieved a double-digit year-over-year increase in monthly active consumers during the quarter, driven by the growing mindshare and increasing scale of our quick commerce business.
The number of 88VIP members, our highest spending consumer group, continued to increase by double digits year-over-year, surpassing 59 million. We will continue to focus on improving the retention of 88VIP membership through enhanced value proposition to our most valued customers.
Alibaba International Digital Commerce Group (“AIDC”)
For the quarter ended December 31, 2025, AIDC narrowed loss significantly year-over-year, driven by a combination of logistics optimization and investment efficiency enhancement. The unit economics of the AliExpress’ Choice business also improved on a sequential basis.
AIDC continued to diversify and enrich product offerings by leveraging the supply chain advantage of the Alibaba ecosystem. For example, further to the joint venture that we formed with Shinsegae in South Korea, we have broadened our collaboration to sell high-quality South Korean products on other platforms of AIDC, mainly Lazada. In addition, AliExpress’ “Brand+” program, which provides go-to-market solutions to brands going overseas, accelerated the onboarding of brands during the quarter and achieved substantial sales growth quarter-over-quarter.
AI + Cloud Businesses
Cloud Intelligence Group
For the quarter ended December 31, 2025, revenue from Cloud Intelligence Group was RMB43,284 million (US$6,190 million). The year-over-year growth of total revenue, and revenue excluding Alibaba consolidated subsidiaries, accelerated to 36% and 35% respectively. This momentum was primarily driven by public cloud revenue growth, including the increasing adoption of AI-related products. AI-related product revenue continued to show strong momentum, delivering the tenth consecutive quarter of triple-digit year-over-year growth.
Alibaba Cloud continues to lead the market, attracting more customers to onboard our comprehensive AI + cloud products and services, including high-performance networking, distributed storage, cloud operating system, and services for model training and inference. In the 2025 Gartner® Magic Quadrant™ for Cloud Database Management Systems, Alibaba Cloud has been named a Leader for the sixth consecutive year. In the Gartner® Emerging Market Quadrants for Generative AI Technologies report, Alibaba Cloud has been recognized again as an Emerging Leader across all four quadrants evaluated for Generative AI, the only cloud service provider in Asia Pacific to earn this distinction.
We have maintained our position as the overall leader in China’s financial cloud market for six consecutive years since 2019H1, according to IDC’s China Semiannual Financial Cloud Tracker, 2025H1 report. Backed by our full-stack AI cloud capabilities, Alibaba Cloud led the public cloud infrastructure market for financial services with a record high of 43% market share. Meanwhile, according to IDC’s 2024 China Hybrid Cloud Market Share report published in November 2025, Alibaba Cloud retained our position as the leader in China’s hybrid cloud PaaS and services market.
We also launched the new Alibaba Cloud Linux, a next-generation AI infrastructure operating system built for cloud-based AI workloads, capable of supporting the training of trillion-parameter models while significantly improving efficiency across both training and inference.
With international markets as a key strategic priority, we have continued to expand our global footprints. Alibaba Cloud operated 92 availability zones across 29 regions worldwide as of December 31, 2025, making us China’s number one and a leading global cloud service provider.
Qwen Model Family
Qwen model family, our enterprise-grade large model suite, continues to drive rapid AI adoption across key verticals, including intelligent manufacturing, financial services, consumer retail, and cloud-native development, delivering measurable productivity gains through its full-stack, multimodal capabilities. Underpinned by cutting-edge AI foundation models, extensive real-world deployment, and clear technological leadership, our Qwen models are scaling rapidly in both technology innovation and adoption.
In February, we launched Qwen3.5, marking another important step in advancing our model capabilities. This new launch further strengthens our leadership in multimodal AI with strong performance across reasoning, coding, agentic tasks and multimodal understanding, while delivering higher inference efficiency and broader global accessibility.
Qwen models, the world’s most widely used open-source model family, surpassed 1 billion cumulative downloads on Hugging Face as of January 21, 2026.
Chip Design – T-Head
T-Head Semiconductor Co., Ltd. (“T-Head”), our chip design subsidiary, has brought its proprietary GPU into production at scale, supporting end-to-end AI workloads from training and fine-tuning to inference. Compatible with mainstream AI frameworks, T-Head enhances our long-term computing supply capacity. By combining its capabilities with our Qwen models and cloud computing, it delivers highly cost-effective AI services to external customers. This business has scaled rapidly and now contributes meaningfully to our cloud infrastructure supply.
Qwen App
Powered by our most advanced Qwen3.5 foundation model, Qwen app, our flagship consumer-facing AI application, represents an important milestone in our AI strategy: transforming proprietary model leadership into scalable, real-world applications.
On January 15, 2026, we announced a significant upgrade to Qwen app, enabling deep integration with core services across our ecosystem, including Taobao and Tmall, Taobao Instant Commerce, Amap, Fliggy, and Alipay. Qwen app intelligently coordinates services across multiple platforms, becoming the first AI assistant capable of executing large-scale, real-world complex tasks in China. This marks an important shift in the AI industry from chat-based interactions to a new era of task-oriented execution. This ecosystem-wide integration further expands our user reach, strengthens engagement across Alibaba’s platforms, and reinforces our leadership in applied AI.
Since launching its Chinese New Year campaign on February 6, Qwen app has seen tremendous user engagement. By the end of February, approximately 140 million users have had their first AI-driven shopping experience through Qwen app’s agentic features from ordering food and groceries to ticketing and travel bookings. In February, consumer-facing Qwen has surpassed 300 million monthly active users across all platforms.
DECEMBER QUARTER SUMMARY FINANCIAL RESULTS
Three months ended December 31,
2024
2025
RMB
RMB
US$
YoY %
Change
(in millions, except percentages and per share amounts)
Revenue
280,154
284,843
40,732
2%
Income from operations
41,205
10,645
1,522
(74)%(2)
Operating margin
15%
4%
Adjusted EBITDA(1)
62,054
34,057
4,870
(45)%(2)
Adjusted EBITDA margin(1)
22%
12%
Adjusted EBITA(1)
54,853
23,397
3,346
(57)%(2)
Adjusted EBITA margin(1)
20%
8%
Net income
46,434
15,631
2,235
(66)%(2)
Net income attributable to ordinary shareholders
48,945
16,322
2,334
(67)%(2)
Non-GAAP net income(1)
51,066
16,710
2,389
(67)%(2)
Diluted earnings per share(3)
2.55
0.74
0.11
(71)%(2)(4)
Diluted earnings per ADS(3)
20.39
5.93
0.85
(71)%(2)(4)
Non-GAAP diluted earnings per share(1)(3)
2.67
0.89
0.13
(67)%(2)(4)
Non-GAAP diluted earnings per ADS(1)(3)
21.39
7.09
1.01
(67)%(2)(4)
____________
(1)
See the sections entitled “Non-GAAP Financial Measures” and “Reconciliations of Non-GAAP Measures to the Nearest Comparable U.S. GAAP Measures” for more information about the non-GAAP measures referred to within this results announcement.
(2)
The year-over-year decreases were primarily attributable to the investment in quick commerce, user experiences, and technology, partly offset by the improved operating results supported by continued growth in Cloud business, as well as enhanced operating efficiencies across various businesses.
(3)
Each ADS represents eight ordinary shares.
(4)
The year-over-year percentages as stated are calculated based on the exact amount and there may be minor differences from the year-over-year percentages calculated based on the RMB amounts after rounding.
DECEMBER QUARTER SEGMENT RESULTS
Revenue for the quarter ended December 31, 2025 was RMB284,843 million (US$40,732 million), an increase of 2% year-over-year compared to RMB280,154 million in the same quarter of 2024. Excluding revenue from the disposed businesses of Sun Art and Intime, revenue on a like-for-like basis would have grown by 9% year-over-year.
The following table sets forth a breakdown of our revenue by segment for the periods indicated:
Three months ended December 31,
2024
2025
RMB
RMB
US$
YoY %
Change
(in millions, except percentages)
Alibaba China E-commerce Group:
E-commerce
- Customer management
101,834
102,664
14,681
1%
- Direct sales, logistics and others(2)
28,824
28,919
4,135
0%
130,658
131,583
18,816
1%
Quick commerce(3)
13,356
20,842
2,980
56%
China commerce wholesale
6,575
6,922
990
5%
Total Alibaba China E-commerce Group
150,589
159,347
22,786
6%
Alibaba International Digital Commerce Group:
International commerce retail
31,553
32,351
4,626
3%
International commerce wholesale
6,203
6,850
980
10%
Total Alibaba International Digital Commerce Group
37,756
39,201
5,606
4%
Cloud Intelligence Group
31,742
43,284
6,190
36%
All others(4)
89,234
67,340
9,629
(25)%
Unallocated
590
603
86
Inter-segment elimination
(29,757)
(24,932)
(3,565)
Consolidated revenue
280,154
284,843
40,732
2%
____________
(1)
To advance our “user first” strategy and enhance user experience, during the quarter ended June 30, 2025, we undertook a strategic combination of Taobao and Tmall Group, Ele.me and Fliggy into Alibaba China E-commerce Group. We simplified the financial reporting structure by reclassifying Cainiao, Amap and Digital Media and Entertainment Group (rebranded to Hujing Digital Media and Entertainment Group) into “All others”. The above presentation has been updated to conform with the new reporting structure, as reviewed by our chief operating decision maker.
(2)
Direct sales, logistics and others revenue under Alibaba China E-commerce Group primarily represents direct sales businesses of Tmall Supermarket, Tmall Global and other businesses, where revenue and cost of inventory are recorded on a gross basis within the business group, as well as revenue from logistics services and value-added services.
(3)
Quick commerce revenue represents quick commerce business revenue, including revenue generated through “Taobao Instant Commerce” and the Ele.me app. Quick commerce revenue is net of subsidies that are contra revenue.
(4)
All others include Freshippo, Cainiao, Alibaba Health, Hujing Digital Media and Entertainment Group, Amap, Qwen Consumer Business Group, Lingxi Games, DingTalk and other businesses. The majority of revenue within All others consists of direct sales, where revenue and cost of inventory are recorded on a gross basis, and revenue from logistics services. The decrease was primarily due to the revenue decrease as a result of the disposal of Sun Art and Intime businesses, as well as the decrease in revenue from Cainiao, partly offset by the increase in revenue from Freshippo and Alibaba Health.
The following table sets forth a breakdown of our adjusted EBITA by segment for the periods indicated:
Three months ended December 31,
2024
2025
RMB
RMB
US$
YoY %
Change(3)
(in millions, except percentages)
Alibaba China E-commerce Group
60,401
34,613
4,949
(43)%
Alibaba International Digital Commerce Group
(4,952)
(2,016)
(288)
59%
Cloud Intelligence Group
3,138
3,911
559
25%
All others
(3,176)
(9,792)
(1,400)
(208)%
Unallocated(2)
(165)
(2,722)
(389)
Inter-segment elimination
(393)
(597)
(85)
Consolidated adjusted EBITA
54,853
23,397
3,346
(57)%
Less: Non-cash share-based compensation expense
(3,414)
(2,396)
(343)
Less: Amortization and impairment of intangible assets
(2,062)
(841)
(120)
Less: Impairment of goodwill, and others
(8,172)
(9,515)
(1,361)
Income from operations
41,205
10,645
1,522
(74)%
____________
(1)
To advance our “user first” strategy and enhance user experience, during the quarter ended June 30, 2025, we undertook a strategic combination of Taobao and Tmall Group, Ele.me and Fliggy into Alibaba China E-commerce Group. We simplified the financial reporting structure by reclassifying Cainiao, Amap and Digital Media and Entertainment Group (rebranded to Hujing Digital Media and Entertainment Group) into “All others”. The above presentation has been updated to conform with the new reporting structure, as reviewed by our chief operating decision maker.
(2)
Unallocated primarily relates to certain costs incurred by corporate functions and other miscellaneous items that are not allocated to individual segments.
(3)
For a more intuitive presentation, widening of loss in YoY% is shown in terms of negative growth rate, and narrowing of loss in YoY% is shown in terms of positive growth rate.
Alibaba China E-commerce Group
(i) Segment revenue
E-commerce Business
Revenue from our E-commerce business in the quarter ended December 31, 2025 was RMB131,583 million (US$18,816 million), an increase of 1% compared to RMB130,658 million in the same quarter of 2024.
Customer management revenue increased by 1% year-over-year, primarily due to the improvement of take rate.
Direct sales, logistics and others revenue under E-commerce business in the quarter ended December 31, 2025 was RMB28,919 million (US$4,135 million), remained stable as compared to RMB28,824 million in the same quarter of 2024, primarily driven by the increase in revenue from logistics services and value-added services, partly offset by the decrease in revenue from certain direct sales businesses.
Quick Commerce Business
Revenue from our Quick commerce business in the quarter ended December 31, 2025 was RMB20,842 million (US$2,980 million), an increase of 56% compared to RMB13,356 million in the same quarter of 2024, mainly due to order growth as a result of the rollout of “Taobao Instant Commerce” at the end of April 2025.
China Commerce Wholesale Business
Revenue from our China commerce wholesale business in the quarter ended December 31, 2025 was RMB6,922 million (US$990 million), an increase of 5% compared to RMB6,575 million in the same quarter of 2024, primarily due to an increase in revenue from value-added services provided to paying members.
(ii) Segment adjusted EBITA
Alibaba China E-commerce Group adjusted EBITA decreased by 43% to RMB34,613 million (US$4,949 million) in the quarter ended December 31, 2025, compared to RMB60,401 million in the same quarter of 2024, primarily due to the investment in quick commerce, user experiences, and technology.
Alibaba International Digital Commerce Group
(i) Segment revenue
International Commerce Retail Business
Revenue from our International commerce retail business in the quarter ended December 31, 2025 was RMB32,351 million (US$4,626 million), an increase of 3% compared to RMB31,553 million in the same quarter of 2024, primarily driven by the increase in revenue contributed by AliExpress and other international businesses, and partly offset by the decrease in revenue of Lazada. As certain of our international businesses generate revenue in local currencies while our reporting currency is Renminbi, AIDC’s revenue is affected by exchange rate fluctuations.
International Commerce Wholesale Business
Revenue from our International commerce wholesale business in the quarter ended December 31, 2025 was RMB6,850 million (US$980 million), an increase of 10% compared to RMB6,203 million in the same quarter of 2024, primarily due to an increase in revenue generated by cross-border related value-added services.
(ii) Segment adjusted EBITA
Alibaba International Digital Commerce Group adjusted EBITA was a loss of RMB2,016 million (US$288 million) in the quarter ended December 31, 2025, compared to a loss of RMB4,952 million in the same quarter of 2024, primarily due to significant improvement in AliExpress’ operating efficiency, and enhanced efficiencies across various businesses.
Cloud Intelligence Group
(i) Segment revenue
Revenue from Cloud Intelligence Group was RMB43,284 million (US$6,190 million) in the quarter ended December 31, 2025, an increase of 36% compared to RMB31,742 million in the same quarter of 2024. Overall revenue excluding Alibaba-consolidated subsidiaries increased by 35% year-over-year, primarily driven by public cloud revenue growth, including the increasing adoption of AI-related products.
(ii) Segment adjusted EBITA
Cloud Intelligence Group adjusted EBITA increased by 25% to RMB3,911 million (US$559 million) in the quarter ended December 31, 2025, compared to RMB3,138 million in the same quarter of 2024, primarily due to revenue growth and improving operating efficiency, partly offset by the increasing investments in customer growth and technology innovation.
All Others
(i) Segment revenue
Revenue from All others segment was RMB67,340 million (US$9,629 million) in the quarter ended December 31, 2025, a decrease of 25% compared to RMB89,234 million in the same quarter of 2024, primarily due to the revenue decrease as a result of the disposal of Sun Art and Intime businesses, as well as the decrease in revenue from Cainiao, partly offset by the increase in revenue from Freshippo and Alibaba Health.
(ii) Segment adjusted EBITA
Adjusted EBITA from All others segment in the quarter ended December 31, 2025 was a loss of RMB9,792 million (US$1,400 million), compared to a loss of RMB3,176 million in the same quarter of 2024, primarily due to the increased investment in technology businesses, partly offset by the improved results of Cainiao, Hujing Digital Media and Entertainment Group and other businesses.
DECEMBER QUARTER OTHER FINANCIAL RESULTS
Costs and Expenses
The following tables set forth a breakdown of our costs and expenses, share-based compensation expense, and costs and expenses excluding share-based compensation expense by function for the periods indicated:
Three months ended December 31,
% of
Revenue
YoY
change
2024
2025
RMB
% of
Revenue
RMB
US$
% of
Revenue
(in millions, except percentages)
Costs and expenses:
Cost of revenue
162,524
58.0%
169,534
24,243
59.5%
1.5%
Product development expenses
14,662
5.2%
15,480
2,214
5.4%
0.2%
Sales and marketing expenses
42,675
15.2%
71,934
10,286
25.3%
10.1%
General and administrative expenses
10,851
3.9%
8,355
1,195
2.9%
(1.0)%
Amortization and impairment of intangible assets
2,062
0.7%
841
120
0.3%
(0.4)%
Impairment of goodwill
6,171
2.2%
9,515
1,361
3.3%
1.1%
Total costs and expenses
238,945
275,659
39,419
Share-based compensation expense:
Cost of revenue
540
0.2%
623
89
0.2%
0.0%
Product development expenses
1,602
0.6%
1,907
273
0.7%
0.1%
Sales and marketing expenses
535
0.2%
1,011
145
0.4%
0.2%
General and administrative expenses
1,188
0.4%
1,318
188
0.5%
0.1%
Total share-based compensation expense(1)
3,865
4,859
695
Costs and expenses excluding share-based compensation expense:
Cost of revenue
161,984
57.8%
168,911
24,154
59.3%
1.5%
Product development expenses
13,060
4.7%
13,573
1,941
4.8%
0.1%
Sales and marketing expenses
42,140
15.0%
70,923
10,141
24.9%
9.9%
General and administrative expenses
9,663
3.4%
7,037
1,007
2.5%
(0.9)%
Amortization and impairment of intangible assets
2,062
0.7%
841
120
0.3%
(0.4)%
Impairment of goodwill
6,171
2.2%
9,515
1,361
3.3%
1.1%
Total costs and expenses excluding share-based compensation expense
235,080
270,800
38,724
____________
(1)
This includes both cash and non-cash share-based compensation expenses.
Cost of revenue – Cost of revenue in the quarter ended December 31, 2025 was RMB169,534 million (US$24,243 million), or 59.5% of revenue, compared to RMB162,524 million, or 58.0% of revenue, in the same quarter of 2024. Without the effect of share-based compensation expense, cost of revenue as a percentage of revenue would have increased from 57.8% in the quarter ended December 31, 2024 to 59.3% in the quarter ended December 31, 2025, primarily due to higher logistics cost and increased bandwidth and co-location fees reflecting the growth in our quick commerce and cloud businesses respectively, partly offset by the disposal of Sun Art and Intime businesses.
Product development expenses – Product development expenses in the quarter ended December 31, 2025 were RMB15,480 million (US$2,214 million), or 5.4% of revenue, compared to RMB14,662 million, or 5.2% of revenue, in the same quarter of 2024. Without the effect of share-based compensation expense, product development expenses as a percentage of revenue would have increased from 4.7% in the quarter ended December 31, 2024 to 4.8% in the quarter ended December 31, 2025.
Sales and marketing expenses – Sales and marketing expenses in the quarter ended December 31, 2025 were RMB71,934 million (US$10,286 million), or 25.3% of revenue, compared to RMB42,675 million, or 15.2% of revenue, in the same quarter of 2024. Without the effect of share-based compensation expense, sales and marketing expenses as a percentage of revenue would have increased from 15.0% in the quarter ended December 31, 2024 to 24.9% in the quarter ended December 31, 2025, primarily attributable to the investment in user experiences of Alibaba China E-commerce Group.
General and administrative expenses – General and administrative expenses in the quarter ended December 31, 2025 were RMB8,355 million (US$1,195 million), or 2.9% of revenue, compared to RMB10,851 million, or 3.9% of revenue, in the same quarter of 2024. Without the effect of share-based compensation expense, general and administrative expenses as a percentage of revenue would have decreased from 3.4% in the quarter ended December 31, 2024 to 2.5% in the quarter ended December 31, 2025.
Share-based compensation expense – Total share-based compensation expense included in the cost and expense items above in the quarter ended December 31, 2025 was RMB4,859 million (US$695 million), compared to RMB3,865 million in the same quarter of 2024.
The following table sets forth our analysis of share-based compensation expense for the quarters indicated by type of share-based awards:
Three months ended December 31,
2024
2025
RMB
RMB
US$
YoY %
Change
(in millions, except percentages)
By type of awards:
Alibaba Group share-based awards(1)
2,532
2,185
313
(14)%
Others(2)
1,333
2,674
382
101%
Total share-based compensation expense(3)
3,865
4,859
695
26%
____________
(1)
This represents Alibaba Group share-based awards granted to our employees.
(2)
This represents share-based awards of our subsidiaries and Ant Group granted to our employees.
(3)
This includes both cash and non-cash share-based compensation expenses.
Share-based compensation expense increased in the quarter ended December 31, 2025 compared to the same quarter of 2024. The year-over-year increase was primarily driven by our recent strategic initiative to rebrand “Ele.me” to “Taobao Instant Commerce” during the quarter, which reflected cost associated with talent retention incentive from the replacement awards plan of Ele.me. This was partly offset by the decrease in the number of Alibaba Group share-based awards granted as we have increased the proportion of long-term cash incentives granted after considering the macroeconomic environment and the general trends in the talent market.
We expect that our share-based compensation expense will continue to be affected by changes in the fair value of the underlying awards and the quantity of awards we grant in the future.
Amortization and impairment of intangible assets – Amortization and impairment of intangible assets in the quarter ended December 31, 2025 was RMB841 million (US$120 million), a decrease of 59% from RMB2,062 million in the same quarter of 2024, primarily due to the impairment of intangible assets relating to our businesses within All others segment recorded last year, as well as the full amortization of certain intangible assets.
Impairment of goodwill – Impairment of goodwill in the quarter ended December 31, 2025 was RMB9,515 million (US$1,361 million), an increase of 54% from RMB6,171 million in the same quarter of 2024, both of which are related to All others segment.
Income from operations and operating margin
Income from operations in the quarter ended December 31, 2025 was RMB10,645 million (US$1,522 million), or 4% of revenue, a decrease of 74% compared to RMB41,205 million, or 15% of revenue, in the same quarter of 2024, primarily due to the decrease in adjusted EBITA.
Adjusted EBITDA and Adjusted EBITA
Adjusted EBITDA decreased 45% year-over-year to RMB34,057 million (US$4,870 million) in the quarter ended December 31, 2025, compared to RMB62,054 million in the same quarter of 2024. Adjusted EBITA decreased 57% year-over-year to RMB23,397 million (US$3,346 million) in the quarter ended December 31, 2025, compared to RMB54,853 million in the same quarter of 2024, primarily attributable to the investment in quick commerce, user experiences, and technology, partly offset by the improved operating results supported by continued growth in Cloud business, as well as enhanced operating efficiencies across various businesses. A reconciliation of net income to adjusted EBITDA and adjusted EBITA is included at the end of this results announcement.
Adjusted EBITA by segment
Adjusted EBITA by segment as well as a reconciliation of income from operations to adjusted EBITA are set forth in the section entitled “December Quarter Segment Results” above.
Interest and investment income, net
Interest and investment income, net in the quarter ended December 31, 2025 was RMB16,221 million (US$2,320 million), an increase of 46% compared to RMB11,146 million in the same quarter of 2024, primarily due to mark-to-market changes and the decrease in impairment of our investments.
The above-mentioned investment gains and losses were excluded from our non-GAAP net income.
Other income (expense), net
Other income (expense), net in the quarter ended December 31, 2025 was an expense of RMB434 million (US$62 million), compared to income of RMB4,588 million in the same quarter of 2024, primarily due to the net exchange loss in this quarter compared to the net exchange gain in the same quarter last year, arising from the exchange rate fluctuation between Renminbi and U.S. dollar.
Income tax expenses
Income tax expenses in the quarter ended December 31, 2025 were RMB8,460 million (US$1,210 million), compared to RMB11,149 million in the same quarter of 2024.
Share of results of equity method investees
Share of results of equity method investees in the quarter ended December 31, 2025 was RMB216 million (US$31 million), a decrease of 93% compared to RMB3,129 million in the same quarter of 2024. The following table sets forth a breakdown of share of results of equity method investees for the periods indicated:
Three months ended December 31,
2024
2025
RMB
RMB
US$
(in millions)
Share of profit of equity method investees
- Ant Group
4,490
393
56
- Others
39
696
100
Impairment loss
(523)
(1)
–
Others(1)
(877)
(872)
(125)
Total
3,129
216
31
____________
(1)
“Others” mainly include basis differences arising from equity method investees, share-based compensation expense related to share-based awards granted to employees of our equity method investees, as well as gain or loss arising from the deemed disposal of the equity method investees.
We record our share of results of all equity method investees one quarter in arrears. The year-over-year decrease in share of profit of Ant Group was mainly attributable to the decrease in fair value of certain investments and investments in new growth initiatives, including user growth, and technologies.
Net income and Non-GAAP net income
Our net income in the quarter ended December 31, 2025 was RMB15,631 million (US$2,235 million), compared to RMB46,434 million in the same quarter of 2024, primarily attributable to the decrease in income from operations.
Excluding non-cash share-based compensation expense, gains/losses of investments, impairment of goodwill and intangible assets, and certain other items, non-GAAP net income in the quarter ended December 31, 2025 was RMB16,710 million (US$2,389 million), a decrease of 67% compared to RMB51,066 million in the same quarter of 2024, primarily attributable to the investment in quick commerce, user experiences, and technology, partly offset by the improved operating results supported by continued growth in Cloud business, as well as enhanced operating efficiencies across various businesses. A reconciliation of net income to non-GAAP net income is included at the end of this results announcement.
Net income attributable to ordinary shareholders
Net income attributable to ordinary shareholders in the quarter ended December 31, 2025 was RMB16,322 million (US$2,334 million), compared to RMB48,945 million in the same quarter of 2024, primarily attributable to the decrease in income from operations.
Diluted earnings per ADS/share and non-GAAP diluted earnings per ADS/share
Diluted earnings per ADS in the quarter ended December 31, 2025 was RMB5.93 (US$0.85), compared to RMB20.39 in the same quarter of 2024. Excluding non-cash share-based compensation expense, gains/losses of investments, impairment of goodwill and intangible assets, and certain other items, non-GAAP diluted earnings per ADS in the quarter ended December 31, 2025 was RMB7.09 (US$1.01), a decrease of 67% compared to RMB21.39 in the same quarter of 2024.
Diluted earnings per share in the quarter ended December 31, 2025 was RMB0.74 (US$0.11 or HK$0.82), compared to RMB2.55 in the same quarter of 2024. Excluding non-cash share-based compensation expense, gains/losses of investments, impairment of goodwill and intangible assets, and certain other items, non-GAAP diluted earnings per share in the quarter ended December 31, 2025 was RMB0.89 (US$0.13 or HK$0.98), a decrease of 67% compared to RMB2.67 in the same quarter of 2024.
A reconciliation of diluted earnings per ADS/share to non-GAAP diluted earnings per ADS/share is included at the end of this results announcement. Each ADS represents eight ordinary shares.
Cash and cash equivalents, short-term investments and other treasury investments
As of December 31, 2025, cash and cash equivalents, short-term investments and other treasury investments included in equity securities and other investments on the consolidated balance sheets, of which that are unrestricted for withdrawal and use, were RMB560,175 million (US$80,104 million), compared to RMB597,132 million as of March 31, 2025. Other treasury investments consist of fixed deposits, certificate of deposits and marketable debt securities with original maturities over one year for treasury purposes. The decrease in cash and cash equivalents, short-term investments and other treasury investments of RMB36,957 million during the nine months ended December 31, 2025, was primarily due to (i) free cash flow outflow of RMB29,309 million (US$4,191 million), (ii) dividend payment of RMB33,690 million (US$4,818 million), (iii) cash used in repurchase of ordinary shares of RMB7,638 million (US$1,092 million), partly offset by (iv) the net proceeds from issuance of convertible unsecured senior notes and the payments for capped call transactions of RMB20,967 million (US$2,998 million), and (v) the net proceeds from issuance of exchangeable bonds of RMB10,986 million (US$1,571 million).
Net cash provided by operating activities and free cash flow
During the quarter ended December 31, 2025, net cash provided by operating activities was RMB36,032 million (US$5,152 million), a decrease of 49% compared to RMB70,915 million in the same quarter of 2024. Free cash flow, a non-GAAP measurement of liquidity, was RMB11,346 million (US$1,622 million), a decrease of 71% compared to RMB39,020 million in the same quarter of 2024. The decrease in free cash flow was mainly attributed to the investment in quick commerce. A reconciliation of net cash provided by operating activities to free cash flow is included at the end of this results announcement.
Net cash used in investing activities
During the quarter ended December 31, 2025, net cash used in investing activities of RMB25,716 million (US$3,677 million) primarily reflected capital expenditures of RMB28,999 million (US$4,147 million), and net cash outflow of RMB6,959 million (US$995 million) for investment and acquisition activities, partly offset by net decrease in short-term investments and other treasury investments by RMB9,917 million (US$1,418 million).
Net cash used in financing activities
During the quarter ended December 31, 2025, net cash used in financing activities of RMB13,742 million (US$1,965 million) primarily reflected cash used in net repayment of bank borrowings of RMB11,969 million (US$1,712 million).
Employees
As of December 31, 2025, we had a total of 128,197 employees, compared to 126,661 as of September 30, 2025.
WEBCAST AND CONFERENCE CALL INFORMATION
Alibaba Group’s management will hold a conference call to discuss the financial results at 7:30 a.m. U.S. Eastern Time (7:30 p.m. Hong Kong Time) on Thursday, March 19, 2026.
All participants must pre-register to join this conference call using the Participant Registration link below:
English: https://s1.c-conf.com/diamondpass/10052713-hndm7s.html
Chinese: https://s1.c-conf.com/diamondpass/10052714-wh6tua.html
Upon registration, each participant will receive details for the conference call, including dial-in numbers, conference call passcode and a unique access PIN. To join the conference, please dial the number provided, enter the passcode followed by your PIN, and you will join the conference.
A live webcast of the earnings conference call can be accessed at https://www.alibabagroup.com/en/ir/earnings. An archived webcast will be available through the same link following the call. A replay of the conference call will be available for one week from the date of the conference (Dial-in number: +1 855 883 1031; English conference PIN 10052713; Chinese conference PIN 10052714).
Please visit Alibaba Group’s Investor Relations website at https://www.alibabagroup.com/en/ir/home on March 19, 2026 to view the earnings release and accompanying slides prior to the conference call.
ABOUT ALIBABA GROUP
Alibaba Group is a global technology company focused on e-commerce and cloud computing. We enable merchants, brands and retailers to market, sell and engage with consumers by providing digital and logistics infrastructure, efficiency tools and vast marketing reach. We empower enterprises with our leading cloud infrastructure, services and work collaboration capabilities to facilitate their digital transformation and grow their businesses.
EXCHANGE RATE INFORMATION
This results announcement contains translations of certain Renminbi (“RMB”) amounts into U.S. dollars (“US$”) and Hong Kong dollars (“HK$”) for the convenience of the reader. Unless otherwise stated, all translations of RMB into US$ were made at RMB6.9931 to US$1.00, the exchange rate on December 31, 2025 as set forth in the H.10 statistical release of the Federal Reserve Board, and all translations of RMB into HK$ were made at RMB0.90322 to HK$1.00, the middle rate on December 31, 2025 as published by the People’s Bank of China. The percentages stated in this announcement are calculated based on the RMB amounts and there may be minor differences due to rounding.
SAFE HARBOR STATEMENTS
This results announcement contains forward-looking statements. These statements are made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as “may,” “will,” “expect,” “anticipate,” “future,” “aim,” “estimate,” “intend,” “seek,” “plan,” “believe,” “potential,” “continue,” “ongoing,” “target,” “guidance,” “is/are likely to” and similar statements. In addition, statements that are not historical facts, including statements about Alibaba’s strategies and business and operational plans, Alibaba’s beliefs, expectations and guidance regarding the growth of its business, its operating and financial results, return on investments, strategic investments and dispositions and share repurchases, and the business outlook and quotations from management in this results announcement, are or contain forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to: Alibaba’s ability to compete, innovate and maintain or grow its business; risks associated with sustained investments in Alibaba’s businesses; risks related to strategic transactions; fluctuations in general economic and business conditions in China and globally; uncertainties arising from competition among countries and geopolitical tensions, including national trade, investment, protectionist or other policies and export control, economic or trade sanctions; changes to our shareholder return initiatives; and assumptions underlying or related to any of the foregoing. Further information regarding these and other risks is included in Alibaba’s filings with the U.S. Securities and Exchange Commission and announcements on the website of The Stock Exchange of Hong Kong Limited. All information provided in this results announcement is as of the date of this results announcement and are based on assumptions that we believe to be reasonable as of this date, and Alibaba does not undertake any obligation to update any forward-looking statement, except as required under applicable law.
NON-GAAP FINANCIAL MEASURES
To supplement our consolidated financial statements, which are prepared and presented in accordance with GAAP, we use the following non-GAAP financial measures: for our consolidated results, adjusted EBITDA (including adjusted EBITDA margin), adjusted EBITA (including adjusted EBITA margin), non-GAAP net income, non-GAAP diluted earnings per share/ADS and free cash flow. For more information on these non-GAAP financial measures, please refer to the table captioned “Reconciliations of Non-GAAP Measures to the Nearest Comparable U.S. GAAP Measures” in this results announcement.
We believe that adjusted EBITDA, adjusted EBITA, non-GAAP net income and non-GAAP diluted earnings per share/ADS help identify underlying trends in our business that could otherwise be distorted by the effect of certain income or expenses that we include in income from operations, net income and diluted earnings per share/ADS. We believe that these non-GAAP measures provide useful information about our core operating results, enhance the overall understanding of our past performance and future prospects and allow for greater visibility with respect to key metrics used by our management in its financial and operational decision-making. We present three different income measures, namely adjusted EBITDA, adjusted EBITA and non-GAAP net income in order to provide more information and greater transparency to investors about our operating results.
We consider free cash flow to be a liquidity measure that provides useful information to management and investors about the amount of cash generated by our business that can be used for strategic corporate transactions, including investing in our new business initiatives, making strategic investments and acquisitions and strengthening our balance sheet.
Adjusted EBITDA, adjusted EBITA, non-GAAP net income, non-GAAP diluted earnings per share/ADS and free cash flow should not be considered in isolation or construed as an alternative to income from operations, net income, diluted earnings per share/ADS, cash flows or any other measure of performance or as an indicator of our operating performance. These non-GAAP financial measures presented here do not have standardized meanings prescribed by U.S. GAAP and may not be comparable to similarly titled measures presented by other companies. Other companies may calculate similarly titled measures differently, limiting their usefulness as comparative measures to our data.
Adjusted EBITDA represents net income before interest and investment income, net, interest expense, other income (expense), net, income tax expenses, share of results of equity method investees, certain non-cash expenses, consisting of share-based compensation expense, amortization and impairment of intangible assets, impairment of goodwill, depreciation and impairment of property and equipment, and operating lease cost relating to land use rights, and others (including provision in relation to matters outside the ordinary course of business), which we do not believe are reflective of our core operating performance during the periods presented.
Adjusted EBITA represents net income before interest and investment income, net, interest expense, other income (expense), net, income tax expenses, share of results of equity method investees, certain non-cash expenses, consisting of share-based compensation expense, amortization and impairment of intangible assets, impairment of goodwill, and others (including provision in relation to matters outside the ordinary course of business), which we do not believe are reflective of our core operating performance during the periods presented.
Non-GAAP net income represents net income before non-cash share-based compensation expense, amortization and impairment of intangible assets, gain or loss on deemed disposals/disposals/revaluation of investments, impairment of goodwill and investments, and others (including provision in relation to matters outside the ordinary course of business), and adjustments for the tax effects.
Non-GAAP diluted earnings per share represents non-GAAP net income attributable to ordinary shareholders divided by the weighted average number of outstanding ordinary shares, in each case for computing non-GAAP diluted earnings per share. Non-GAAP diluted earnings per ADS represents non-GAAP diluted earnings per share after adjusting for the ordinary share-to-ADS ratio.
Free cash flow represents net cash provided by operating activities as presented in our consolidated cash flow statement less purchases of property and equipment (excluding acquisition of land use rights and construction in progress relating to office campuses) and intangible assets (excluding those acquired through acquisitions), as well as adjustments to exclude from net cash provided by operating activities the buyer protection fund deposits from merchants on our marketplaces. We deduct certain items of cash flows from investing activities in order to provide greater transparency into cash flow from our revenue-generating business operations. We exclude “acquisition of land use rights and construction in progress relating to office campuses” because the office campuses are used by us for corporate and administrative purposes and are not directly related to our revenue-generating business operations. We also exclude buyer protection fund deposits from merchants on our marketplaces because these deposits are restricted for the purpose of compensating buyers for claims against merchants.
The table captioned “Reconciliations of Non-GAAP Measures to the Nearest Comparable U.S. GAAP Measures” in this results announcement has more details on the non-GAAP financial measures that are most directly comparable to GAAP financial measures and the related reconciliations between these financial measures.
ALIBABA GROUP HOLDING LIMITED
UNAUDITED CONSOLIDATED INCOME STATEMENTS
Three months ended December 31,
Nine months ended December 31,
2024
2025
2024
2025
RMB
RMB
US$
RMB
RMB
US$
(in millions, except per share data)
(in millions, except per share data)
Revenue
280,154
284,843
40,732
759,893
780,290
111,580
Cost of revenue
(162,524)
(169,534)
(24,243)
(452,659)
(456,744)
(65,313)
Product development expenses
(14,662)
(15,480)
(2,214)
(42,217)
(47,576)
(6,803)
Sales and marketing expenses
(42,675)
(71,934)
(10,286)
(107,842)
(191,608)
(27,399)
General and administrative expenses
(10,851)
(8,355)
(1,195)
(33,908)
(23,133)
(3,308)
Amortization and impairment of intangible assets
(2,062)
(841)
(120)
(5,503)
(2,474)
(354)
Impairment of goodwill
(6,171)
(9,515)
(1,361)
(6,171)
(9,515)
(1,361)
Other (losses) gains, net
(4)
1,461
209
847
1,758
251
Income from operations
41,205
10,645
1,522
112,440
50,998
7,293
Interest and investment income, net
11,146
16,221
2,320
28,275
53,689
7,677
Interest expense
(2,485)
(2,557)
(366)
(7,100)
(7,552)
(1,080)
Other income (expense), net
4,588
(434)
(62)
3,367
895
128
Income before income tax and share of results of equity method investees
54,454
23,875
3,414
136,982
98,030
14,018
Income tax expenses
(11,149)
(8,460)
(1,210)
(28,591)
(22,875)
(3,271)
Share of results of equity method investees
3,129
216
31
5,612
3,470
496
Net income
46,434
15,631
2,235
114,003
78,625
11,243
Net loss (income) attributable to noncontrolling interests
2,693
752
108
3,547
(574)
(82)
Net income attributable to Alibaba Group Holding Limited
49,127
16,383
2,343
117,550
78,051
11,161
(Accretion) Reversal of accretion of mezzanine equity
(182)
(61)
(9)
(462)
2,377
340
Net income attributable to ordinary shareholders
48,945
16,322
2,334
117,088
80,428
11,501
Earnings per share attributable to ordinary shareholders(1)
Basic
2.63
0.88
0.13
6.20
4.33
0.62
Diluted
2.55
0.74
0.11
6.04
4.18
0.60
Earnings per ADS attributable to ordinary shareholders(1)
Basic
21.07
7.03
1.01
49.58
34.66
4.96
Diluted
20.39
5.93
0.85
48.33
33.46
4.78
Weighted average number of shares used in calculating earnings per ordinary share (million shares)(1)
Basic
18,586
18,568
18,892
18,564
Diluted
19,200
19,310
19,372
19,207
____________
(1)
Each ADS represents eight ordinary shares.
ALIBABA GROUP HOLDING LIMITED
UNAUDITED CONSOLIDATED BALANCE SHEETS
As of March 31,
As of December 31,
2025
2025
RMB
RMB
US$
(in millions)
Assets
Current assets:
Cash and cash equivalents
145,487
128,174
18,329
Short-term investments
228,826
179,955
25,733
Restricted cash and escrow receivables
43,781
42,345
6,055
Equity securities and other investments
53,780
29,981
4,287
Prepayments, receivables and other assets
202,175
231,761
33,142
Total current assets
674,049
612,216
87,546
Equity securities and other investments
356,818
440,384
62,974
Prepayments, receivables and other assets
83,431
98,329
14,061
Investment in equity method investees
210,169
208,832
29,862
Property and equipment, net
203,348
254,478
36,390
Intangible assets, net
20,911
18,607
2,661
Goodwill
255,501
245,453
35,099
Total assets
1,804,227
1,878,299
268,593
Liabilities, Mezzanine Equity and Shareholders’ Equity
Current liabilities:
Current bank borrowings
22,562
24,655
3,526
Income tax payable
11,638
11,235
1,607
Accrued expenses, accounts payable and other liabilities
332,537
351,293
50,234
Merchant deposits
274
246
35
Deferred revenue and customer advances
68,335
72,382
10,350
Total current liabilities
435,346
459,811
65,752
ALIBABA GROUP HOLDING LIMITED
UNAUDITED CONSOLIDATED BALANCE SHEETS (CONTINUED)
As of March 31,
As of December 31,
2025
2025
RMB
RMB
US$
(in millions)
Deferred revenue
4,536
4,454
637
Deferred tax liabilities
48,454
46,232
6,611
Non-current bank borrowings
49,909
51,423
7,353
Non-current unsecured senior notes
122,398
118,637
16,965
Non-current convertible unsecured senior notes
35,834
56,473
8,076
Non-current exchangeable bonds
–
11,552
1,652
Other liabilities
17,644
23,789
3,402
Total liabilities
714,121
772,371
110,448
Commitments and contingencies
Mezzanine equity
11,713
7,751
1,108
Shareholders’ equity:
Ordinary shares
1
1
–
Additional paid-in capital
381,379
382,770
54,735
Treasury shares at cost
(36,329)
(36,143)
(5,168)
Statutory reserves
15,936
16,628
2,378
Accumulated other comprehensive income (loss)
3,393
(6,431)
(920)
Retained earnings
645,478
682,830
97,644
Total shareholders’ equity
1,009,858
1,039,655
148,669
Noncontrolling interests
68,535
58,522
8,368
Total equity
1,078,393
1,098,177
157,037
Total liabilities, mezzanine equity and equity
1,804,227
1,878,299
268,593
ALIBABA GROUP HOLDING LIMITED
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
Three months ended December 31,
Nine months ended December 31,
2024
2025
2024
2025
RMB
RMB
US$
RMB
RMB
US$
(in millions)
(in millions)
Net cash provided by operating activities
70,915
36,032
5,152
135,989
66,803
9,553
Net cash used in investing activities
(111,003)
(25,716)
(3,677)
(145,868)
(77,040)
(11,017)
Net cash provided by (used in) financing activities
14,251
(13,742)
(1,965)
(72,113)
(5,571)
(797)
Effect of exchange rate changes on cash and cash equivalents, restricted cash and escrow receivables
3,331
(1,498)
(214)
1,534
(2,941)
(420)
Decrease in cash and cash equivalents, restricted cash and escrow receivables
(22,506)
(4,924)
(704)
(80,458)
(18,749)
(2,681)
Cash and cash equivalents, restricted cash and escrow receivables at beginning of period
228,472
175,443
25,088
286,424
189,268
27,065
Cash and cash equivalents, restricted cash and escrow receivables at end of period
205,966
170,519
24,384
205,966
170,519
24,384
ALIBABA GROUP HOLDING LIMITED
RECONCILIATIONS OF NON-GAAP MEASURES TO THE NEAREST COMPARABLE U.S. GAAP MEASURES
The table below sets forth a reconciliation of our net income to adjusted EBITA and adjusted EBITDA for the periods indicated:
Three months ended December 31,
Nine months ended December 31,
2024
2025
2024
2025
RMB
RMB
US$
RMB
RMB
US$
(in millions)
(in millions)
Net income
46,434
15,631
2,235
114,003
78,625
11,243
Adjustments to reconcile net income to adjusted EBITA and adjusted EBITDA:
Interest and investment income, net
(11,146)
(16,221)
(2,320)
(28,275)
(53,689)
(7,677)
Interest expense
2,485
2,557
366
7,100
7,552
1,080
Other (income) expense, net
(4,588)
434
62
(3,367)
(895)
(128)
Income tax expenses
11,149
8,460
1,210
28,591
22,875
3,271
Share of results of equity method investees
(3,129)
(216)
(31)
(5,612)
(3,470)
(496)
Income from operations
41,205
10,645
1,522
112,440
50,998
7,293
Non-cash share-based compensation expense
3,414
2,396
343
11,189
8,472
1,211
Amortization and impairment of intangible assets
2,062
841
120
5,503
2,474
354
Impairment of goodwill, and others
8,172
9,515
1,361
11,317
9,370
1,340
Adjusted EBITA
54,853
23,397
3,346
140,449
71,314
10,198
Depreciation and impairment of property and equipment, and operating lease cost relating to land use rights
7,201
10,660
1,524
20,093
25,734
3,680
Adjusted EBITDA
62,054
34,057
4,870
160,542
97,048
13,878
ALIBABA GROUP HOLDING LIMITED
RECONCILIATIONS OF NON-GAAP MEASURES TO THE NEAREST COMPARABLE U.S. GAAP MEASURES (CONTINUED)
The table below sets forth a reconciliation of our net income to non-GAAP net income for the periods indicated:
Three months ended December 31,
Nine months ended December 31,
2024
2025
2024
2025
RMB
RMB
US$
RMB
RMB
US$
(in millions)
(in millions)
Net income
46,434
15,631
2,235
114,003
78,625
11,243
Adjustments to reconcile net income to non-GAAP net income:
Non-cash share-based compensation expense
3,414
2,396
343
11,189
8,472
1,211
Amortization and impairment of intangible assets
2,062
841
120
5,503
2,474
354
Gain on deemed disposals/disposals/revaluation of investments
(12,954)
(14,269)
(2,041)
(21,070)
(43,589)
(6,233)
Impairment of goodwill and investments, and others
13,326
13,130
1,878
21,538
15,585
2,229
Tax effects(1)
(1,216)
(1,019)
(146)
(2,888)
(995)
(142)
Non-GAAP net income
51,066
16,710
2,389
128,275
60,572
8,662
____________
(1)
Tax effects primarily comprise tax effects relating to non-cash share-based compensation expense, amortization and impairment of intangible assets and certain gains and losses from investments, and others.
ALIBABA GROUP HOLDING LIMITED
RECONCILIATIONS OF NON-GAAP MEASURES TO THE NEAREST COMPARABLE U.S. GAAP MEASURES (CONTINUED)
The table below sets forth a reconciliation of our diluted earnings per share/ADS to non-GAAP diluted earnings per share/ADS for the periods indicated:
Three months ended December 31,
Nine months ended December 31,
2024
2025
2024
2025
RMB
RMB
US$
RMB
RMB
US$
(in millions, except per share data)
(in millions, except per share data)
Net income attributable to ordinary shareholders – basic
48,945
16,322
2,334
117,088
80,428
11,501
Dilution effect on earnings arising from non-cash share-based awards operated by equity method investees and subsidiaries
(87)
(66)
(10)
(218)
(324)
(46)
Adjustments for interest expense attributable to convertible unsecured senior notes
70
84
12
165
227
32
Dilution effect on earnings arising from assumed exchange of exchangeable bonds
–
(2,030)
(290)
–
–
–
Net income attributable to ordinary shareholders – diluted
48,928
14,310
2,046
117,035
80,331
11,487
Non-GAAP adjustments to net income attributable to ordinary shareholders(1)
2,404
2,802
401
10,925
(17,430)
(2,492)
Non-GAAP net income attributable to ordinary shareholders for computing non-GAAP diluted earnings per share/ADS
51,332
17,112
2,447
127,960
62,901
8,995
Weighted average number of shares on a diluted basis for computing non-GAAP diluted earnings per share/ADS (million shares)(2)
19,200
19,310
19,372
19,207
Diluted earnings per share(2)(3)
2.55
0.74
0.11
6.04
4.18
0.60
Non-GAAP diluted earnings per share(2)(4)
2.67
0.89
0.13
6.61
3.27
0.47
Diluted earnings per ADS(2)(3)
20.39
5.93
0.85
48.33
33.46
4.78
Non-GAAP diluted earnings per ADS(2)(4)
21.39
7.09
1.01
52.84
26.20
3.75
____________
(1)
Non-GAAP adjustments exclude the attributions to the noncontrolling interests for computing non-GAAP diluted earnings per share/ADS. See the table above for items regarding the reconciliation of net income to non-GAAP net income (before taking into account the dilutive impact and excluding the attributions to the noncontrolling interests).
(2)
Each ADS represents eight ordinary shares.
(3)
Diluted earnings per share is derived from dividing net income attributable to ordinary shareholders by the weighted average number of outstanding ordinary shares, on a diluted basis. Diluted earnings per ADS is derived from the diluted earnings per share after adjusting for the ordinary share-to-ADS ratio.
(4)
Non-GAAP diluted earnings per share is derived from dividing non-GAAP net income attributable to ordinary shareholders by the weighted average number of outstanding ordinary shares, in each case for computing non-GAAP diluted earnings per share. Non-GAAP diluted earnings per ADS is derived from the non-GAAP diluted earnings per share after adjusting for the ordinary share-to-ADS ratio.
ALIBABA GROUP HOLDING LIMITED
RECONCILIATIONS OF NON-GAAP MEASURES TO THE NEAREST COMPARABLE U.S. GAAP MEASURES (CONTINUED)
The table below sets forth a reconciliation of net cash provided by operating activities to free cash flow for the periods indicated:
Three months ended December 31,
Nine months ended December 31,
2024
2025
2024
2025
RMB
RMB
US$
RMB
RMB
US$
(in millions)
(in millions)
Net cash provided by operating activities
70,915
36,032
5,152
135,989
66,803
9,553
Less: Purchase of property and equipment (excluding land use rights and construction in progress relating to office campuses)
(31,369)
(25,376)
(3,629)
(60,285)
(95,433)
(13,647)
Less: Changes in the buyer protection fund deposits
(526)
690
99
(5,577)
(679)
(97)
Free cash flow
39,020
11,346
1,622
70,127
(29,309)
(4,191)
ALIBABA GROUP HOLDING LIMITED
REVENUE
The following table sets forth a breakdown of our revenue by segment for the periods indicated:
Nine months ended December 31,
2024
2025
RMB
RMB
US$
YoY %
Change
(in millions, except percentages)
Alibaba China E-commerce Group:
E-commerce
- Customer management
254,589
270,843
38,730
6%
- Direct sales, logistics and others(2)
79,057
82,250
11,762
4%
333,646
353,093
50,492
6%
Quick commerce(3)
40,873
58,532
8,370
43%
China commerce wholesale
18,513
20,372
2,913
10%
Total Alibaba China E-commerce Group
393,032
431,997
61,775
10%
Alibaba International Digital Commerce Group:
International commerce retail
80,862
88,814
12,700
10%
International commerce wholesale
17,859
19,927
2,850
12%
Total Alibaba International Digital Commerce Group
98,721
108,741
15,550
10%
Cloud Intelligence Group
87,901
116,506
16,660
33%
All others(4)
255,071
188,908
27,013
(26)%
Unallocated
1,478
1,699
243
Inter-segment elimination
(76,310)
(67,561)
(9,661)
Consolidated revenue
759,893
780,290
111,580
3%
____________
(1)
To advance our “user first” strategy and enhance user experience, during the quarter ended June 30, 2025, we undertook a strategic combination of Taobao and Tmall Group, Ele.me and Fliggy into Alibaba China E-commerce Group. We simplified the financial reporting structure by reclassifying Cainiao, Amap and Digital Media and Entertainment Group (rebranded to Hujing Digital Media and Entertainment Group) into “All others”. The above presentation has been updated to conform with the new reporting structure, as reviewed by our chief operating decision maker.
(2)
Direct sales, logistics and others revenue under Alibaba China E-commerce Group primarily represents direct sales businesses of Tmall Supermarket, Tmall Global and other businesses, where revenue and cost of inventory are recorded on a gross basis within the business group, as well as revenue from logistics services and value-added services.
(3)
Quick commerce revenue represents quick commerce business revenue, including revenue generated through “Taobao Instant Commerce” and the Ele.me app. Quick commerce revenue is net of subsidies that are contra revenue.
(4)
All others include Freshippo, Cainiao, Alibaba Health, Hujing Digital Media and Entertainment Group, Amap, Qwen Consumer Business Group, Lingxi Games, DingTalk and other businesses. The majority of revenue within All others consists of direct sales, where revenue and cost of inventory are recorded on a gross basis, and revenue from logistics services. The decrease was primarily due to the revenue decrease as a result of the disposal of Sun Art and Intime businesses, as well as the decrease in revenue from Cainiao, partly offset by the increase in revenue from Freshippo, Alibaba Health and Amap.
ALIBABA GROUP HOLDING LIMITED
INFORMATION ABOUT SEGMENTS
The following table sets forth a breakdown of our adjusted EBITA by segment for the periods indicated:
Nine months ended December 31,
2024
2025
RMB
RMB
US$
YoY %
Change(3)
(in millions, except percentages)
Alibaba China E-commerce Group
153,481
83,499
11,940
(46)%
Alibaba International Digital Commerce Group
(11,563)
(1,913)
(273)
83%
Cloud Intelligence Group
8,136
10,469
1,497
29%
All others
(6,086)
(14,577)
(2,084)
(140)%
Unallocated(2)
(2,307)
(4,362)
(624)
Inter-segment elimination
(1,212)
(1,802)
(258)
Consolidated adjusted EBITA
140,449
71,314
10,198
(49)%
Less: Non-cash share-based compensation expense
(11,189)
(8,472)
(1,211)
Less: Amortization and impairment of intangible assets
(5,503)
(2,474)
(354)
Less: Impairment of goodwill, and others
(11,317)
(9,370)
(1,340)
Income from operations
112,440
50,998
7,293
(55)%
____________
(1)
To advance our “user first” strategy and enhance user experience, during the quarter ended June 30, 2025, we undertook a strategic combination of Taobao and Tmall Group, Ele.me and Fliggy into Alibaba China E-commerce Group. We simplified the financial reporting structure by reclassifying Cainiao, Amap and Digital Media and Entertainment Group (rebranded to Hujing Digital Media and Entertainment Group) into “All others”. The above presentation has been updated to conform with the new reporting structure, as reviewed by our chief operating decision maker.
(2)
Unallocated primarily relates to certain costs incurred by corporate functions and other miscellaneous items that are not allocated to individual segments.
(3)
For a more intuitive presentation, widening of loss in YoY% is shown in terms of negative growth rate, and narrowing of loss in YoY% is shown in terms of positive growth rate.
View source version on businesswire.com: https://www.businesswire.com/news/home/20260318501558/en/
Investor Relations Contact
Lydia Liu
Head of Investor Relations
Alibaba Group Holding Limited
investor@alibaba-inc.com
Media Contacts
Cathy Yan
cathy.yan@alibaba-inc.com
Ivy Ke
ivy.ke@alibaba-inc.com
Original: Alibaba Group Announces December Quarter 2025 Results
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