Chinese e-commerce giant Alibaba Group Holding (NYSE:BABA) could highlight the growth of its AI products and new initiatives when it reports second-quarter financial results on Tuesday before the market opens.
Here are the earnings estimates, what analysts are saying and key items to watch.
Earnings Estimates: Analysts expect Alibaba to report second-quarter revenue of $34.43 billion, up from $33.70 billion in last year's second quarter, according to data from Benzinga Pro.
The company has beaten analyst estimates for revenue in seven of the last 10 quarters, including the most recent first quarter.
Analysts expect Alibaba to report second-quarter earnings per share of 81 cents, down from $2.15 in last year's second quarter.
The company has beaten analyst estimates for earnings per share in seven of the last 10 quarters, including in three straight quarters.
Read Also: David Tepper’s Hedge Funds Bets On AMD, Nvidia In Q3, Takes Profits On Intel
What Analysts Are Saying: Strong cloud revenue growth led Goldman Sachs to raise its price target on Alibaba stock.
The Goldman Sachs analyst maintained a Buy rating and raised the price target to $205 from $179.
Cloud revenue is expected to grow by more than 30% year over year in each of the coming three fiscal years, according to analysts' new estimates.
The analyst also highlighted breakthroughs in AI models for Alibaba and a diversified chip supply, leading to a more bullish tone on the stock.
Benchmark analyst Fawne Jiang recently reiterated a Buy rating on Alibaba and raised the price target to $195 from $176.
The analyst highlighted Alibaba's focus on enhancing its cloud business segment alongside expanding its e-commerce business. Jiang said the company is focused on strengthening its position in cloud and GenAI, two growth sectors.
Key Items to Watch: Alibaba's earnings report comes as shares are rallying on Monday, thanks to new data for the company's Qwen app. The company said the app had over 10 million downloads in its first week.
Qwen is the company's unified app for its AI features, like the Tongyi app and Quark browser. The impressive milestone comes in a tough AI sector, where DeepSeek and other Chinese companies compete.
With a strong market position in e-commerce, strong brand awareness, and early strength in downloads, Alibaba's focus on new AI-related products could pay off. Alibaba's Qwen could become a super app for the AI era in China, given the tools and services it offers.
Alibaba has been marketing Qwen as "the best personal AI assistant." The app is built on Alibaba Cloud's open-source Qwen model. Alibaba is adopting a "free-for-all" strategy that could help drive mass adoption and put it ahead of rivals that charge subscription fees.
Within the model, Alibaba aims to monetize the app and users through products like cloud services and data.
Ant Group, which is partially owned by Alibaba Group, has also been working on boosting its AI products. The company recently rolled out an AI assistant, LingGuang, that can help create apps in about 30 seconds.
Alibaba founder Jack Ma recently toured Ant Group's Hangzhou campus and highlighted the company's LingGuang launch. While Ma is no longer in charge of Alibaba, he is one of the key figures in the company's history and his appearance with Ant Group could provide a boost to the spotlight on the company's new products.
The company's Cloud Intelligence Group reported 26% year-over-year revenue growth in the first quarter, driven by rising demand for cloud services and AI products. AI-related product revenue has grown by 100% or more in eight consecutive quarters.
"Looking ahead, we remain committed to investing in our two strategic pillars of consumption and AI + Cloud to capture historic opportunities and drive long-term growth," Alibaba CEO Eddie Wu said after first-quarter results.
While e-commerce will lead the way in overall revenue for the company, the data points and commentary on cloud and AI will likely determine if shares keep trading higher in 2025.
BABA Price Action: Alibaba stock is up 5.3% to $161.00 on Monday versus a 52-week trading range of $80.06 to $192.67. Alibaba shares are up 89.3% year-to-date in 2025.
Read Next:
Photo: Shutterstock
© 2025 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
