Photo credit: Alibaba Group
Alibaba Group on Tuesday reported earnings for the quarter ending March 31. Shortly afterward, Alibaba Group’s CEO and Director Eddie Wu addressed investors and analysts on an earnings call.
Hello everyone.
Following several quarters of adjustments and continued user experience enhancement, our core business has gradually returned to healthy growth. Taobao Tmall Group (TTG) achieved double-digit year-over-year growth in GMV this quarter.
Alibaba International Digital Commerce (AIDC) revenue increased by 45%. Our core public cloud offerings recorded double-digit year-over-year growth in revenue. AI-related revenue increased triple-digit year-over-year.
This quarter’s results demonstrate that our strategies are working and we are returning to growth.
User-First
TTG continued to execute its “user-first” strategy by creating a system for brands, channel merchants, and industrial belts to operate efficiently and meet the diverse needs of China’s domestic consumers through a shopping experience that offers quality products at attractive prices supported by exemplary service.
Our investments in driving price competitiveness and elevating the user experience have received positive consumer feedback. We have seen tangible results and progress: strong growth in quarterly buyers and purchase frequency that has driven robust double-digit growth in GMV, reflecting a continued improvement in consumption and user trust on the platform.
For fiscal year 2025, we expect TTG’s GMV will gradually return to healthy growth as our platform’s overall shopping experience continues to improve
At the same time, we continued to enhance member benefits and service experiences, with 88VIP membership numbers growing by double digits year-over-year to surpass 35 million members.
Last quarter, I shared TTG’s three key investment areas aimed at overall enhancement: one, product supply; two, competitive pricing; three, quality service. We are committed to boosting consumption and purchase frequency through these measures, driving further growth.
For fiscal year 2025, we expect TTG’s GMV will gradually return to healthy growth as our platform’s overall shopping experience continues to improve. At the same time, our schedule of launching monetization products will also proceed as planned.
In the second half of the fiscal year, we will gradually introduce new monetization mechanisms aligned with new platform algorithms and product features that will further enhance revenue that has CMR at its core.
As we continue to improve platform products and investment tactics under our “user-first” strategy, we are very confident we will win more consumer trust and maintain our market share leadership.
The AI Era
This quarter, we completed adjustments to Alibaba Cloud’s product strategy for the AI era, and the quality of our revenue continued to improve. We focused on creating competitive advantages in Alibaba Cloud’s technology and scale, and reduced pricing for public cloud products globally.
Driven by strong demand from various sectors including foundational model companies, Internet companies, as well as customers from industries such as financial services and automotive, AI-related revenue accelerated and continued to record triple-digit growth year-over-year.
We believe this wave of generative AI-driven technological innovation is in the early stages of the industry cycle.
Starting in 2024, we have seen a rapid increase in customer demand for AI. It has also stimulated growth in demand for traditional cloud computing needs, including general computing, storage, and big data.
Therefore, we are actively investing in our cloud computing product matrix, especially in AI infrastructure, to capture the monumental opportunities. Currently, Alibaba Cloud has established strategic partnerships with the vast majority of leading foundational model companies in China.
We aim to create the premier AI development platform that combines outstanding AI capabilities and high-cost efficiency, redefining the industry benchmark for cost performance
At the same time, Alibaba’s proprietary foundational model Tongyi released a 110 billion parameter model in late April, which is on par with top open-source models globally.
Looking ahead, we will deeply integrate our Tongyi large model with Alibaba Cloud’s advanced AI infrastructure to realize synergies and optimization across software and hardware. We aim to create the premier AI development platform that combines outstanding AI capabilities and high-cost efficiency, redefining the industry benchmark for cost performance.
Based on our leading product portfolio, substantial infrastructure investments, and proactive industry partner strategy, we are confident that Alibaba Cloud’s revenue – which excludes revenue from internal customers – will return to double-digit growth in the second half of the 2025 fiscal year.
Driving Growth
For our overseas e-commerce, AIDC revenue grew 45%, and order volume grew 20% year-over-year this quarter due to continued focus on expanding cross-border retail operations and enhancing the consumer experience. Jiang Fan will share more details later.
In March this year, we withdrew Cainiao’s IPO application. Cainiao provides essential infrastructure to Alibaba’s core e-commerce business, and we hope Cainiao will strengthen its synergies with our Chinese domestic and international e-commerce operations.
At the same time, Alibaba Group will continue to support the expansion of Cainiao’s global logistics network.
The past year has been a year of self-transformation for Alibaba. We are pleased that adjustments in our business and organization have yielded results. A journey of transformation will undoubtedly have challenges, but we are well-prepared. In the new fiscal year, Alibaba Group will continue to focus on investing and executing our “user-first, AI-driven” strategy.
We are confident in the long-term healthy development of our company.
