Alibaba · China · Wall Street · Decrypt
In April, it shut down the free tier of its Qwen Code coding agent
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The company is also expanding beyond China's borders.
Key facts
- Alibaba Cloud's external revenue growth accelerated to 45%, and AI-related product revenue hit 12.38 billion yuan ($1.82 billion)—its 12th consecutive quarter of triple-digit year-over-year growth
- Capital expenditure jumped 75% to 67.7 billion yuan ($10 billion), which Alibaba tied mainly to climbing chip prices and expanding compute capacity as AI demand outpaces supply
- Chinese tech titan Alibaba reported fiscal first-quarter revenue of 268.95 billion yuan, roughly $40 billion, on Thursday, up 9% year-over-year and slightly ahead of the 268.88 billion yuan analysts
- That distribution bet is already showing up in the numbers: Chinese open-weight models jumped from under 2% of tokens generated on OpenRouter in late 2024 to roughly 61% by mid-2026, even
Summary
Alibaba's fiscal first-quarter revenue rose 9% year-over-year to 268.95 billion yuan ($40 billion), narrowly beating the 268.88 billion yuan analyst estimate, while net income fell 75% to RMB 10.44billion ($1.6 billion). Alibaba Cloud's external revenue growth accelerated to 45%, and AI-related product revenue logged its 12th straight quarter of triple-digit growth, reaching 12.38 billion yuan ($1.82 billion). Capital expenditure jumped 75% to 67.7 billion yuan ($10 billion), pushing free cash flow to a $6.6 billion outflow; U.S.-listed shares fell as much as 5% before paring the drop to roughly 3.5%. Chinese tech titan Alibaba reported fiscal first-quarter revenue of 268.95 billion yuan, roughly $40 billion, on Thursday, up 9% year-over-year and slightly ahead of the 268.88 billion yuan analysts expected. It's the fastest quarterly growth rate the company has posted in roughly three years.