Morgan Stanley's research report highlights that, despite a temporary deceleration in the growth rate of Alibaba's core e-commerce sector (CMR), Alibaba Cloud—a key element of its investment rationale—continues to demonstrate a robust growth path. Fueled by vigorous industry demand, Alibaba Cloud's existing capital expenditure forecasts may fall short in satisfying customer requirements. The introduction of new AI applications is anticipated to spur greater user engagement. Morgan Stanley projects a 35% revenue surge for Alibaba Cloud in the third fiscal quarter, followed by a 36% increase in the fourth fiscal quarter, with growth accelerating to 40% by fiscal year 2027. Concurrently, Morgan Stanley expects CMR growth to decelerate to 7.5% in the third fiscal quarter, largely attributable to a sluggish macroeconomic climate. Cainiao's business loss scenario is performing better than anticipated, leading Morgan Stanley to revise its loss estimate for Cainiao in the third fiscal quarter down to 25 billion yuan. The firm underscores that Alibaba is exhibiting signs of a rebound, characterized by “accelerated cloud business expansion + reduced losses in instant e-commerce”. It maintains an “overweight” stance on Alibaba, setting a target price of $200. Earlier, Alibaba Cloud's stronger-than-expected performance briefly propelled pre-market stock price increases; however, the stock ended the day down by over 2% following the earnings announcement.