AI services propel Alibaba to 7% revenue growth in Q1

Chinese technology leader Alibaba reported a 7% year-on-year increase in revenue for the first quarter of 2025, propelled by surging demand for artificial intelligence (AI)-driven services and strong performance in its cloud computing segment.

In its latest earnings disclosure, Alibaba posted a revenue of 236.5 billion yuan (USD32.6 billion) for the quarter. A key contributor to this growth was its Cloud Intelligence division, which saw an 18% jump in revenue to 30.1 billion yuan (USD4.18 billion), as interest in AI-powered solutions continued to rise.

The company’s net income also surged significantly, reaching 12.4 billion yuan (USD1.7 billion)—a 279% increase compared to the same period last year.

“We are confident in our business outlook and will continue to invest in our core businesses to strengthen our competitive advantages. We remain committed to enhancing shareholder returns,” said Alibaba’s CFO Toby Xu.

Recent strategic alliances have further bolstered Alibaba’s AI momentum. In February, Apple announced a collaboration with Alibaba to introduce AI services to iPhones sold in China. A month later, BMW revealed a partnership with the company to integrate AI features in vehicles sold locally and to co-develop a proprietary engine using Alibaba’s large language model (LLM), Qwen.

In April, Alibaba released the latest version of its AI model, “Qwen3,” which reportedly matched or outperformed benchmark results of US-based OpenAI’s o1 and Chinese rival DeepSeek’s R1 models.

The results underscore Alibaba’s intensified focus on AI as a core business driver amid an increasingly competitive global tech landscape.