Quarterly profit fell 75% as capital spending grew
Alibaba Group reported earnings on Thursday showing a 75% drop in quarterly profit alongside a 45% increase in revenue from its AI cloud and compute services.
The Hong Kong- and U.S.-listed company said its profit for the April-June quarter was 10.5 billion yuan ($1.6 billion), down from 43.1 billion yuan ($6.4 billion) in the same quarter a year earlier.
Total quarterly revenue grew 9% to nearly 269 billion yuan (about $40 billion). Revenue from AI cloud and compute services rose 45% to 48.4 billion yuan ($7.2 billion) during the quarter.
Capital expenditures, including investments in AI infrastructure to meet customer demand, grew 75% to 67.7 billion yuan (about $10 billion) during the quarter.
Alibaba, which started in e-commerce and online retail, is increasingly focused on AI technologies.