Quartz · Photo by Horacio Villalobos#Corbis/Getty Images Catherine Baab Tue, November 25, 2025 at 8:56 PM GMT+8 2 min read In this article: - BABA +0.38%
Alibaba’s latest earnings report shows the Chinese tech megacap leaning hard into the two engines that management believes will define its future — namely, "instant commerce" and AI. And those bets are starting to pay off.
For the quarter ended September 30, Alibaba reported 15% revenue growth over last year, excluding its divested retail operations — making for one of its strongest showings in recent memory. The company credited growth in consumer activity and its expansion into one-hour delivery, a much-contested battleground where China’s biggest retailers are slashing prices and pouring money into logistics to win market share.
By the looks of it, Alibaba is emerging as one of the winners
The company said revenue from its instant commerce businesses grew about 60%, driven by one-hour and same-day fulfillment services that draw users into Taobao’s broader ecosystem and function to boost frequent, repeat purchases.
Granted, this strategy is pretty expensive — adjusted earnings for Alibaba’s China commerce division fell sharply versus the 2024 numbers — but the company said the unit economics have “substantially improved” recently, with efficiency increasing and order values rising, too.
So what’s powering profitability?
It’s primarily Alibaba’s other pillar — cloud computing.
Revenue at Alibaba Cloud grew 34%, on the back of demand for AI infrastructure and workloads driving eye-watering triple-digit growth in AI products. External cloud revenue climbed 29%, and the company is also gaining traction with its model "family," Qwen, which now boasts more than 180,000 derivative models on Hugging Face, a central marketplace for open-source AI. The analyst firm Omdia estimates Alibaba holds about 36% of China’s AI cloud market, which puts the company well ahead of domestic rivals.
Alibaba’s international commerce also passed a milestone, with its overseas division reporting 10% revenue growth and posting a profit.
For their part, investors are cheering the news
Alibaba stock jumped 5% on Monday alongside the larger tech rally — one of the steepest rallies of 2025 thus far, and one which saw the Nasdaq rocket nearly 3% in a single day.
Alibaba shares rose another 3% heading into Tuesday’s market open.
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