In 2025, Alibaba Group (NYSE: BABA) has shown significant recovery despite previous challenges, with shares rising sharply. The company is experiencing a notable turnaround in its e-commerce and cloud sectors, attributed to innovations in artificial intelligence (AI) and improved operational efficiency. Revenue growth in its Cloud Intelligence segment reached triple digits, while overall e-commerce revenue increased by 9% last quarter.
Alibaba has established itself as a leading AI player in China, continually enhancing its Qwen model family for specific tasks. The company’s cloud division reported a 69% growth in adjusted EBITA, indicating successful AI investments. Additionally, Alibaba’s international segment, AIDC, saw a 22% revenue increase, despite current negative earnings before interest, taxes, and amortization (EBITA).
As of now, Alibaba trades at a forward P/E ratio of 11.5, suggesting it remains undervalued compared to competitors like Amazon. With $19.8 billion in net cash and investments accounting for nearly 28% of its market capitalization, Alibaba is positioned for long-term growth amidst regulatory challenges and competitive pressures.
