Alibaba Group’s revenue in the third quarter of this year increased by 5% year-on-year, but profit saw a significant decline of 85% to 5.365 billion yuan (RMB).
On November 25th, Alibaba Group (NYSE: BABA, HKEX: 9988) released its quarterly performance for the period ending September 30, 2025.
According to the financial report, Alibaba Group’s revenue in the third quarter was 247.795 billion yuan, a 5% increase compared to the previous year. Excluding the revenue from disposed businesses such as Kaixin Retail and Intime, the comparable revenue growth would be 15%.
However, there was a substantial decline in profit for this quarter. The financial report stated that the operating profit for the period was 5.365 billion yuan, an 85% decrease year-on-year. Adjusted EBITA (non-GAAP) also decreased by 78% to 9.073 billion yuan, with diluted earnings per American Depositary Share (ADS) at 4.36 yuan, down by 71% compared to the previous year.
Alibaba attributed this performance to investments in real-time retail, user experience, and technology, partially offset by the double-digit revenue growth in Alibaba’s China retail business, continued growth in cloud business, and improved operational efficiency in various business segments.
The financial report indicated that the net cash flow from operating activities generated during the reporting period was 10.099 billion yuan, a significant 68% decrease from the 31.438 billion yuan in the same period last year. Free cash flow (a non-GAAP financial liquidity indicator) showed a net outflow of 21.84 billion yuan, compared to a net inflow of 13.735 billion yuan in the same period last year.
The decline in free cash flow was primarily attributed to the ongoing investments in real-time retail business and the increase in capital expenditure related to cloud infrastructure to support business development.