Alibaba Group Holdings saw its U.S.-listed shares decline sharply on Thursday after releasing disappointing fiscal fourth-quarter results for 2025. The Chinese e-commerce and cloud computing titan reported adjusted earnings of 1.57 yuan (approximately $0.22) per share, falling short of analyst expectations. Revenue for the quarter rose 7% year-over-year to 236.5 billion yuan ($32.81 billion), but still missed estimates compiled by Visible Alpha.
The underwhelming performance comes at a time when Chinese consumer spending remains sluggish and competition in the digital marketplace continues to intensify. A combination of macroeconomic headwinds and a crowded retail landscape is putting pressure on Alibaba Group’s core operations, dampening investor sentiment despite otherwise healthy year-over-year growth in several business divisions.
Segment Growth Highlights Mixed Performance
Alibaba Group’s largest segment, the Taobao and Tmall Group—which oversees its domestic e-commerce platforms—reported revenue of 71.08 billion yuan, marking a 12% increase from the same period last year. The company’s international business, Alibaba International Digital Commerce Group, fared better with a 22% revenue gain to 33.58 billion yuan, suggesting stronger traction outside China. Meanwhile, its Cloud Intelligence Group recorded an 18% jump in sales, reaching 30.13 billion yuan, highlighting continued demand in the cloud services sector.
Despite the across-the-board revenue increases, the results did not meet market expectations, as analysts had hoped for a more robust showing following recent efforts by the company to streamline operations and refocus on key growth areas. CFO Toby Xu maintained a positive outlook, stating, “We are confident in our business outlook and will continue to invest in our core businesses to strengthen our competitive advantages.”
Shares Slide Despite Strong Year-to-Date Performance
Investors reacted swiftly to the earnings miss, with Alibaba Group’s U.S.-listed shares falling 7.5% on Thursday. The drop reflects growing concerns about the company’s ability to maintain its momentum amid a weakening Chinese consumer economy and intensifying rivalry from other digital platforms.
Still, the stock remains up about 45% year-to-date, buoyed in part by optimism over recent strategic moves, including leadership changes and a renewed focus on cloud computing and international markets. However, Thursday’s earnings report served as a reminder of the persistent challenges Alibaba faces both at home and abroad.
As the company navigates through shifting market dynamics, analysts and investors alike will be watching closely for signs of recovery in consumer demand and improved margins in the quarters ahead.Alibaba Group is under pressure to deliver on its promises of sustainable growth and operational efficiency.
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