Alibaba reports strong revenue growth in e-commerce and cloud computing, but heavy investments in quick commerce impact profitability and cash flow. The stock has risen 85% this year, with cloud intelligence revenue growing by 34%. E-commerce revenue increased by 16%, led by a 60% surge in quick-commerce revenue.

AI products revenue more than doubled, with cloud computing revenue growing by 34%. Supply constraints may impact AI infrastructure spending. E-commerce revenue increased by 16%, with quick-commerce revenue surging by 60%. Alibaba plans to invest aggressively in quick commerce to drive growth.

Alibaba’s revenue rose by 5% to $34.8 billion, but adjusted EBITA plunged 78% to $1.3 billion. Operating cash flow dropped 68% to $1.4 billion, while free cash flow was an outflow of $3.1 billion. The company plans to invest heavily in quick commerce and AI infrastructure.

Alibaba stock trades at a forward P/E ratio of about 16 times fiscal 2026 analyst estimates. The company is in investment mode for the next few years, with a focus on quick commerce and cloud computing. Consider taking profits at current levels due to increased valuation and investment mode.

Read more at Nasdaq: Alibaba: Is It Time to Buy the Stock as AI Revenue Climbs?