Capital expenditure rose to RMB 67.7 billion in the quarter ending June, driven by increased CPU compute capacity and higher prices for chip components. The spending contributed to a 75% drop in net income to RMB 10.4 billion, though revenue increased 9% to RMB 268.95 billion (US$39.64 billion). Non-GAAP diluted earnings per ADS fell 42% to RMB 8.52.
Alibaba's cloud segment EBITA increased 133% to RMB 5.6 billion, while the AI Labs and Applications segment recorded a loss of RMB 13.9 billion due to Qwen app inference costs. CEO Eddie Wu said the company's full-stack AI strategy positions the business to capture rising demand for compute, noting that AI-related product revenue has grown at triple digits for 12 straight quarters. The company also reported approximately 64 million 88VIP members.
Key sources
- SOURCE@alphasenseinc“Non-GAAP diluted earnings per ADS was RMB8.52 (US$1.26), a decrease of 42% year-over-year”x.com
- SUPPORT@wallstengine“88VIP Members: approximately 64 million”x.com
- SUPPORT@cnbc“primarily driven by uneven timing of customer purchases, an increase in CPU-compute capacity and higher prices across a broad range of chip components”x.com
- SUPPORT@poezhao0605“AI apps lost RMB 13.9 billion in one quarter, mostly on Qwen app inference cost”x.com