To The Moon

$Alibaba(BABA)$ released its first-quarter fiscal 2026 earnings report, with revenue of RMB 268.95 billion, roughly in line with market estimates (RMB 268.52 billion). However, adjusted ADS earnings came in at only RMB 8.52, far below the year-ago figure of RMB 14.75 and the estimate of RMB 11.28. Adjusted net income was RMB 20.72 billion, down 38% year-over-year and missing expectations. Adjusted EBITDA was RMB 39.14 billion, down 14% year-over-year but slightly above estimates. Other income for the quarter was RMB 28.8 billion, significantly below the estimate of RMB 61.15 billion.

The company repurchased approximately 13.4 million shares for a total of $162 million. Profit contribution from Ant Group was $230 million. Following the earnings release, U.S.-listed shares fell nearly 4.4% in pre-market trading.

In terms of cloud and AI infrastructure, Alibaba Cloud's external commercial revenue grew 45% year-over-year this quarter, the highest growth rate in 22 quarters, with improving growth quality.

AI-related product revenue reached RMB 12.376 billion, marking the 12th consecutive quarter of triple-digit year-over-year growth. At the computing power infrastructure level, self-developed chips have achieved large-scale commercialization. T-Head has built a full-stack self-developed system covering GPUs, CPUs, and networking chips. The latest-generation AI processor, Zhenwu M890, has been widely commercialized across more than 650 external clients in over 20 industries, including autonomous driving, internet, and financial services, through Alibaba Cloud.

Meanwhile, Alibaba Cloud has shortened the delivery cycle for large-scale AI data centers to 100 days, and the production capacity efficiency of its self-developed modular data centers is expected to more than double this year to meet stronger AI computing power demands.

Pop Mart founder and CEO Wang Ning said at today’s earnings meeting that the company will likely fall short of its 20% growth target set at the beginning of the year.

In terms of model layer and open-source ecosystem, Alibaba has accelerated its model releases across the board, with major version iterations in large language models, image models, speech models, video models, and music models, all achieving performance on par with the international first tier. The company continues to double down on open-source efforts, most recently open-sourcing the Qwen3.8-Max and Qwen3.8-27B models with up to 2.4 trillion parameters. To date, the Qwen series models have surpassed 3 billion global downloads, with over 300,000 derivative models, reflecting the thriving open-source ecosystem.

In terms of AI-native applications, from the B2B segment to the consumer side, AI-native applications have become a new growth engine. On the enterprise front, Alibaba launched its flagship AI-native productivity agent "Tongyi Office," deeply integrated with Alibaba Cloud and the DingTalk ecosystem, serving as a natural entry point to reach enterprise users. On the consumer front, the Tongyi App has attracted 250 million users to experience AI-powered shopping and is currently adding diversified value-added services to explore C-side commercialization pathways.

In terms of e-commerce business and membership system, the overall e-commerce business remained stable this quarter. As of June 30, 2026, the 88VIP membership base reached approximately 64 million, continuing to expand year-over-year and providing stable support for the core e-commerce business.$BABA-WR(89988)$$BABA-W(09988)$