Alibaba's profit nearly vanishes as cloud revenue surges on AI demand

Alibaba's adjusted net income plummeted to just $12 million in the March quarter, a dramatic decline from previous periods, while its cloud computing revenue surged 38% driven by demand for artificial intelligence services. The Chinese tech giant's earnings report highlights a stark contrast between its core e-commerce business, which faces intense competition and regulatory pressures, and its cloud division, which is capitalizing on the global AI boom. The $12 million profit figure represents a near-total evaporation of earnings for a company that historically posted billions in quarterly net income. Cloud revenue growth accelerated as enterprises and startups increasingly rely on Alibaba Cloud for AI model training and deployment. The results underscore the shifting priorities within Alibaba as it pivots toward high-growth technology segments amid a sluggish domestic economy and heightened regulatory scrutiny. The company's stock fluctuated in after-hours trading as investors weighed the profit collapse against the cloud segment's robust performance.