Alibaba quarterly profit drops 75% as AI investment spending grows

Advertisement

Advertise with us

HONG KONG (AP) — China’s technology giant Alibaba on Thursday reported a 75% drop in profit for the latest quarter as it invested big in artificial intelligence infrastructure, even as revenue coming from its AI-related services gained 45%.

Read this article for free:


or

Already have an account? Log in here »

To continue reading, please subscribe:

Subscribe and receive a limited-edition Free Press branded hat or tote.

Digital Subscription

One year of digital access for only $205*

  • Enjoy unlimited reading on winnipegfreepress.com
  • Read the E-Edition, our digital replica newspaper
  • Access News Break, our award-winning app
  • Play interactive puzzles

*First annual payment billed as $205.00 + GST for one year. This annual subscription will automatically renew at $233.00 + GST every 52 weeks (10% off the regular annual price of $259.35). Offer available to new and qualified returning subscribers only. Cancel any time.

To continue reading, please subscribe:

Add Free Press access to your Brandon Sun subscription for only an additional

$1 for the first 4 weeks*

  • Enjoy unlimited reading on winnipegfreepress.com
  • Read the E-Edition, our digital replica newspaper
  • Access News Break, our award-winning app
  • Play interactive puzzles
Start now

*Your next Brandon Sun subscription payment will increase by $1.00 and you will be charged $17.95 plus GST for four weeks. After four weeks, your payment will increase to $24.95 plus GST every four weeks.

HONG KONG (AP) — China’s technology giant Alibaba on Thursday reported a 75% drop in profit for the latest quarter as it invested big in artificial intelligence infrastructure, even as revenue coming from its AI-related services gained 45%.

The Hong Kong- and U.S.-listed company, which started out in e-commerce and online retail but is increasingly focused on AI technologies, said that its profit for April-June was at 10.5 billion yuan ($1.6 billion), down from 43.1 billion yuan ($6.4 billion) the same quarter last year.

Quarterly revenue grew 9% to almost 269 billion yuan (nearly $40 billion), with revenue from its AI cloud and compute services up 45% to 48.4 billion yuan ($7.2 billion).

FILE - A visitor walks in front of Alibaba booth during the 3rd China International Supply Chain Expo at the China International Exhibition Center, in Beijing, China, Friday, July 18, 2025. (AP Photo/Mahesh Kumar A., File)
FILE - A visitor walks in front of Alibaba booth during the 3rd China International Supply Chain Expo at the China International Exhibition Center, in Beijing, China, Friday, July 18, 2025. (AP Photo/Mahesh Kumar A., File)

But capital expenditures, including investments in AI infrastructure to meet customer demand, jumped 75% to 67.7 billion yuan (about $10 billion) during the quarter, weighing on profits.

Alibaba attributed the significant increase in spendings to factors including “fluctuations” in procurement cycles, increase in CPU, or central processing unit, compute capacity in anticipation of growing customer adoption of AI “agents” and higher pricing of chip components.

“As we continue to ramp up our supply, our AI and Cloud revenue growth will accelerate further in the coming quarters, alongside continued improvement in profitability,” said Alibaba CEO Eddie Wu in prepared remarks during an earnings conference.

Alibaba’s U.S.-traded shares fell more than 3% Thursday.

Alibaba, one of China’s biggest companies, said last year it planned to invest at least 380 billion yuan (about $56 billion) over three years in cloud computing and AI infrastructure.

It has been making advances with its flagship Qwen AI and has launched “agentic” AI services for commercial customers. In July, it previewed its Qwen3.8-Max AI model which the company said was “second only” to Anthropic’s Claude Fable 5.

It has also pledged an ambitious goal of surpassing $100 billion in terms of annual AI and cloud revenue within the next five years.

Report Error Submit a Tip

More Stories

Carney’s defence of Lake Ontario carries enormous weight

Niigaan Sinclair 5 minute read Preview

Carney’s defence of Lake Ontario carries enormous weight

Niigaan Sinclair 5 minute read Yesterday at 4:28 PM CDT

For centuries on Turtle Island (North America), explorers, map makers, and political leaders have erased Indigenous place names and substituted them — more often than not — with political, ethnocentric, and self-aggrandizing names.

In recent years, a few places on the continent have had Indigenous names re-established, but as of today, few of the original names are “official.”

So, it was no surprise when U.S. President Donald Trump on Thursday signed an executive order directing the U.S. Department of the Interior and Board on Geographic Names to take steps within 30 days to officially rename Lake Ontario as “Lake America.”

The move may have been a result of the Canada-U.S. trade war and Trump’s pettiness and ego, but it also fits in perfectly with his career.

Read
Yesterday at 4:28 PM CDT

Beware invasive, ‘frightening’ waterhemp

Laura Rance-Unger 4 minute read Preview

Beware invasive, ‘frightening’ waterhemp

Laura Rance-Unger 4 minute read 2:01 AM CDT

There’s a threat lurking on the edge of Manitoba farmers’ fields this fall that’s even scarier than the escalating trade war with their biggest customer.

Provincial extension advisers are warning farmers to watch for a weed known as “tall waterhemp,” which, true to its name, may already be towering above ready-to-harvest crops.

Those wispy tentacles waving in the breeze look pretty innocuous from a distance. But this highly invasive member of the pigweed family produces hundreds of thousands of seeds that are just itching for dispersal through farmers’ combines and across their fields.

Each of those tiny seeds — one small pill container filled halfway holds 44,000 — can produce plants with stems the width of saplings and heights of two to five metres. One or two plants can quickly turn into a patch. If waterhemp takes over a field, it can choke out the growing crop and cut yields by more than 90 per cent.

Read
2:01 AM CDT

Security guard in stable condition after grocery store assault

Scott Billeck 2 minute read Preview

Security guard in stable condition after grocery store assault

Scott Billeck 2 minute read Updated: 12:35 PM CDT

A security guard was taken to hospital after an assault at a Sargent Avenue FreshCo Friday, just days after another guard was stabbed during a robbery at a St. James Dollarama.

Winnipeg police said officers were called to a store in the 600 block of Sargent Avenue shortly after 1 p.m. for a report of an assault.

An adult victim was taken to hospital in stable condition. Police did not provide details about what led to the assault or whether any arrests were made.

The incident comes three days after a 22-year-old security guard was stabbed during a robbery at a Dollarama in the Courts of St. James.

Read
Updated: 12:35 PM CDT

At the city’s busiest fire and paramedic hall, first responders face a relentless workload

Scott Billeck 24 minute read Preview

At the city’s busiest fire and paramedic hall, first responders face a relentless workload

Scott Billeck 24 minute read Yesterday at 6:00 AM CDT

As a soft rain begins to fall between the concrete walls of “Hope Alley,” little feels further away than the place’s namesake.

Winnipeg Fire Paramedic Service crews have been called to the narrow downtown passage, named by Al Wiebe, a formerly homeless man turned advocate. People regularly pass through here, moving between the shelters, drop-ins and resource centres clustered around Main Street between Logan and Higgins avenues.

Against a wall, as the sky switches into night mode, a man sits bleeding from his nose, seemingly unaware of how he ended up with blood running down his T-shirt.

His situation has already set Winnipeg’s emergency response network in motion.

Read
Yesterday at 6:00 AM CDT

Doctor pays $500K to revamp courtyard at care home where he works

By Zoe Pierce 4 minute read Preview

Doctor pays $500K to revamp courtyard at care home where he works

By Zoe Pierce 4 minute read Thursday, Aug. 27, 2026

Fifty years after Dr. Pravinsagar Mehta began caring for residents at Actionmarguerite, a courtyard he had long watched deteriorate is getting a new life after he and his wife committed $500,000 to its redevelopment and long-term maintenance.

Read
Thursday, Aug. 27, 2026

Former care home nurse fined $8,000 for ‘disturbing in the extreme’ 2025 incident

Morgan Modjeski 3 minute read Preview

Former care home nurse fined $8,000 for ‘disturbing in the extreme’ 2025 incident

Morgan Modjeski 3 minute read Thursday, Aug. 27, 2026

A former nurse has been fined $8,000 and is facing numerous restrictions after making a mistake “no registered nurse should have made” by inserting 10 centimetres of gauze into a patient’s anus instead of dressing a nearby wound.

Read
Thursday, Aug. 27, 2026