Alibaba Group's external cloud revenue growth reached a multi-year high in the June quarter, with AI-related product revenues sustaining triple-digit year-over-year growth for 12 consecutive quarters and now representing more than a third of external cloud revenues. At its September 2026 Apsara Conference, Alibaba outlined its next-generation Qwen roadmap, confirming that its upcoming Qwen 4 model is already in training, with future Qwen 4.5 and Qwen 5 versions projected to scale toward 5-10 trillion parameters, and introduced a new proprietary AI chip alongside an agentic cloud architecture and a mobile AI agent platform. For its first-quarter fiscal 2027, Alibaba reported sharply higher capital expenditure year over year as it continues drawing down a previously announced three-year AI infrastructure investment plan, with a meaningful portion of that multi-year budget already deployed. Management guided that cloud revenue growth is expected to keep accelerating in coming quarters, with EBITDA margins expanding sequentially, and reiterated a longer-term ambition of a much larger external cloud revenue base with materially higher margins by decade's end, while its Model-as-a-Service annualized revenue run rate is targeted to roughly double by fiscal year-end. The Zacks Consensus Estimate for fiscal 2027 earnings is pegged at $6.87 per share, implying 76.61% year-over-year growth, even as BABA shares have plunged 18.6% year to date, underperforming the Zacks Internet – Commerce industry's 3.4% growth and the Retail-Wholesale sector's 1.4% decline.
Alibaba Group Holding LtdSharply higher year-over-year capex on the three-year AI infrastructure plan, guided EBITDA margin expansion, and a Model-as-a-Service run-rate targeted to roughly double by fiscal year-end.
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