Adjusted and diluted earnings per American depository share in the second quarter came in at RMB 14.75, marking a drop of 10% year-on-year.
NYSE-listed shares of Alibaba jumped 4% higher in the pre-market session on Friday, despite the company reporting earnings for the June quarter below Wall Street expectations.
The company reported revenue of RMB 247.652 billion ($34.62 billion), marking a 2% year-on-year increase, which was below the estimated RMB 253.808 billion. Adjusted and diluted earnings per American depository share came in at RMB 14.75, marking a drop of 10% year-on-year.
Revenue from the company’s cloud intelligence group, however, jumped 26%, while revenue from its core China E-commerce Group rose 10%.
On Stocktwits, retail sentiment around BABA stock rose from ‘bullish’ to ‘extremely bullish’ territory, while message volume improved from ‘high’ to ‘extremely high’ levels.
Net income for the June quarter rose 78% to RMB 43.12 billion. The rise is attributable to the gain from the disposal of the local consumer service business of Turkish e-commerce platform Trendyol, which was partially offset by a 3% decrease in income from operations.
Alibaba stated that revenue from its Cloud Intelligence segment totalled RMB 33.40 billion, driven by public cloud revenue growth, including the increasing adoption of AI-related products.
AI-related product revenue maintained triple-digit year-over-year growth for the eighth consecutive quarter, the company stated, while adding that it is seeing increased demand for compute, storage, and other public cloud services to support AI adoption. Earnings before interest, taxes, depreciation, and amortization (EBITDA) from the segment also rose 26% to RMB 2.95 billion.
“Driven by robust AI demand, Cloud Intelligence Group experienced accelerated revenue growth, and AI-related product revenue is now a significant portion of revenue from external customers. Looking ahead, we remain committed to investing in our two strategic pillars of consumption and AI + Cloud to capture historic opportunities and drive long-term growth,” said CEO Eddie Wu.
The company’s total revenue from Alibaba China E-commerce Group rose 10% to RMB 140.07 billion, while EBITDA fell 21% to RMB 38.40 billion.
BABA stock gained 41% this year and by 48% over the past 12 months.
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