Alibaba misses on overall revenue and earnings, but AI sales were higher than expected
The e-commerce giant plans to spend $53 billion on AI infrastructure over the next three years.
Alibaba is up 4% in premarket trading today on results for the first quarter of its 2026 fiscal year, where the company missed on earnings and revenue expectations, but beat estimates for its all-important cloud and AI segment.
💵 Overall revenue came in at $34.6 billion, less than the Bloomberg consensus estimate of $35.4 billion.
🏦 Adjusted earnings per share were $2.06, lower than the $2.23 expected by analysts.
🏪 E-commerce (Taobao/Tmall) brought in $16.55 billion, below the analysts’ $16.94 billion forecast.
☁️ The company’s cloud segment, which includes AI-related sales, had revenue of $4.66 billion, up 26% from the year before and more than the expected $4.44 billion.
“Driven by robust AI demand, Cloud Intelligence Group experienced accelerated revenue growth, and AI-related product revenue is now a significant portion of revenue from external customers,” CEO Eddie Wu said in a statement.
Like its American tech counterparts, Alibaba has gone all in on AI, planning to spend $53 billion on AI infrastructure over the next three years. And, just like with companies in the US, investors are keen to see how its cloud business is paying off.
