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Alibaba posted its fastest revenue growth in over a year, as the Chinese ecommerce giant capitalises on the boom in artificial intelligence spending.
The Hangzhou-based company on Thursday reported an 8 per cent rise in revenues to Rmb280bn ($38bn) in the final quarter of 2024. It was boosted by sales from its cloud business, which rose 13 per cent to Rmb31.7bn. Alibaba’s shares were up 9 per cent pre-trading in the US.
“Looking ahead, revenue growth at Cloud Intelligence Group driven by AI will continue to accelerate. We will continue to execute against our strategic priorities in ecommerce and cloud computing,” said chief executive Eddie Wu.
It comes as Alibaba has seen its share price soar by more than 50 per cent since the start of the year, as it has reaped the benefit of a DeepSeek-led AI rally in Chinese tech groups as well as its tie-up with Apple to roll out AI features for iPhones in China.
The group has also been boosted by the comeback of Alibaba co-founder Jack Ma. On Monday, Ma was included in a high-profile meeting of top Chinese entrepreneurs with China’s leader Xi Jinping.
His invite was seen as a clear signal that China’s most famous entrepreneur had been rehabilitated after becoming the most prominent victim of the government crackdown on the tech sector in 2020.
Sales from Alibaba’s international ecommerce business climbed 32 per cent to Rmb37.8bn ($5.1bn), driven by the growth of its Temu-like AliExpress platform.
The group’s China commerce business grew 5 per cent to Rmb136bn ($18.6bn) in the fourth quarter, driven by charges to merchants rather than consumer spending on its flagship Taobao and Tmall platforms.
Li Chengdong, founder of ecommerce think-tank Haitun, said: “Alibaba’s domestic ecommerce business sales have stopped declining. It has succeeded in its initial goal of stabilising the business”.
Alibaba has been investing heavily in Chinese AI start-ups, including Moonshot and 01.ai, to tap into their AI expertise to gain a technical edge over rivals, such as Baidu and ByteDance.
Over the past 18 months, Alibaba has open-sourced various large language models in an attempt to consolidate its cloud position by attracting developers to its platform.
But the group faces competition in capturing rising demand from AI, such as Chinese tech champion Huawei.
Charlie Dai, principal analyst at Forrester, said that “in the long run, tech leaders with strong research and development resources”, including Alibaba, Baidu, Tencent and Huawei “will all benefit from the expanding market adoption of AI.”
