During the trading session, Alibaba's shares listed on the Hong Kong Stock Exchange tumbled by more than 6%, hitting a low of HK$123.5—a level not seen since August of the previous year. Meanwhile, its U.S.-listed shares concluded the prior day's trading with a decline exceeding 7%. The company's revenue for the third fiscal quarter witnessed a modest 2% year-on-year increase, yet fell short of market expectations. More notably, its net profit plummeted by 67% year-on-year, significantly underperforming against forecasts. The primary factors contributing to the profitability downturn included escalated investments in sectors such as instant retail, a substantial surge in the proportion of sales and marketing expenditures, mounting pressure on its domestic e-commerce operations, and a staggering 71% year-on-year decrease in free cash flow.

Following the earnings announcement, CICC revised its target prices for Alibaba's Hong Kong-listed and U.S.-listed shares downward by 13%, albeit retaining an 'outperform industry' rating. Wall Street investment banks have characterized this development as a 'pivotal profit reset.' The standout feature of the earnings report was the remarkable surge in AI data, with Goldman Sachs projecting Alibaba Cloud's growth rate to soar to 40% in the March quarter, signaling a strategic pivot towards long-term technological leadership.