Alibaba shares drop 4% in premarket trading after big profit miss
Alibaba shares fell on Thursday after the Chinese e-commerce giant missed earnings expectations for its fiscal fourth quarter on both the top and bottom line.
Shares were down 4% in premarket trade in the U.S. at 5:51 a.m. ET.
Here's how Alibaba did in its fiscal fourth quarter ended March versus LSEG estimates:
While falling short of analyst expectations, revenue was nevertheless up 7% year-on-year.
Investors will be looking at whether macroeconomic volatility has affected consumer sentiment in China. Washington's trade war with Beijing has created uncertainty in the world's second-largest economy, which has seen huge tariffs slapped on each other from both sides during the latest quarter in which Alibaba reported.
Both sides agreed to suspend most tariffs on each other's goods this month.
Over the last few months, China has also introduced policies to spur consumption and consumer purchases.
In a move to boost purchases on its Tmall and Taobao platforms, Alibaba extended a partnership with Rednote, or Xiaohongshu, an Instagram-like service in China. The deal allows Taobao links to be embedded in Rednote posts, so users can be taken directly to a product shopping page.
Investors are also focused on Alibaba's efforts in artificial intelligence, where it has become a leading player domestically and globally.
In April, the Hangzhou-headquartered company launched the latest version of its open source large language model, Qwen 3, which is being used to power Alibaba's AI assistant Quark.
AI competition in China is red hot and was exacerbated by DeepSeek's innovative model launched earlier this year. Chinese tech giant Tencent meanwhile on Tuesday announced a 91% year-on-year rise in capital expenditures in the first quarter, driven by investments in AI.
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