Chinese giant Alibaba posts profit and revenue beat in December quarter amid strength in cloud unit

Chinese e-commerce titan Alibaba on Thursday beat expectations on the top and bottom line in its December quarter, citing ongoing strength in its Cloud Intelligence unit.

Alibaba said net income hit 48.945 billion yuan ($6.72 billion) in the quarter ended Dec. 31, compared with an LSEG forecast of 40.6 billion yuan.

Revenue came in at 280.154 billion yuan, versus analyst expectations of 279.34 billion yuan.

The company's stock has surged by around 50% on both the New York and Hong Kong exchanges in the year to date.

"This quarter's results demonstrated substantial progress in our 'user first, AI-driven' strategies and the re-accelerated growth of our core businesses," said Alibaba CEO Eddie Wu in a statement accompanying the results.

"Our Cloud revenue growth reignited to double digits at 13%, with AI-related product revenue achieving triple-digit growth for the sixth consecutive quarter. Looking ahead, revenue growth at Cloud Intelligence Group driven by AI will continue to accelerate."

U.S.-listed shares of the company were up 4.3% at 05:53 ET, shortly after the release of the results.

Alibaba's Cloud Intelligence Group posted year-on-year sales growth of 13% to 31.742 billion yuan in the three months to the end of December.

The retail giant's tech activities are being closely watched by investors after the announcement of the Chinese company's partnership with Apple to roll out AI features for iPhones sold in Chinese.

Market focus has sharpened on Chinese tech developments following the revolutionary late-January release of local startup DeepSeek's new AI model, which the company claims is more efficient and affordably produced than sector-leading U.S. counterparts. Alibaba, which first made inroads into AI with the launch of its own ChatGPT-style product Tongyi Qianwen (Qwen) in 2023, earlier this year rolled out a new Qwen 2.5 version of its technology that it claimed exceeds the DeepSeek model, according to Reuters.

Alibaba's outspoken founder Jack Ma, who has largely kept out of the public eye since 2020, was among the entrepreneurs who attended a rare closed-door meeting headed by Chinese President Xi Jinping on Monday, during which the Beijing leader urged private businesses to "show their talents" and strengthen their confidence in a "new era" for their activity.

This breaking news story is being updated.