<div id="readability-page-1">Alibaba’s (NYSE:BABA) June quarter results might have missed the estimates but that mattered little to investors who sent shares surging by 13% last Friday.<h3>Elevate Your Investing Strategy:</h3><ul><li> Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence. </li></ul> In its fiscal first quarter, the Chinese tech giant reported revenue of $34.57 billion, up 2% year-over-year, falling short expectations by $910 million. That said, on a like-for-like basis – excluding Sun Art and Intime, which were sold – revenue would have grown by 10%. At the other end of the spectrum, adj. EPADS came in at $2.06, missing the forecast by $0.10. Pressure on adj. profit in Alibaba’s core e-commerce segment came as a result of heavy investment in China’s “quick commerce” market. Meanwhile, the cloud business saw faster growth; Alicloud revenue rose by 25.8% in Q1, up from 17.7% in Q4, and for the first time, Alibaba said that AI-driven revenue made up more than 20% of external Cloud revenue. Strong cloud growth aside, on the face of it, the quarter’s performance appears somewhat lackluster. Indeed, Bernstein analyst Robin Zhu says the quarter was “mediocre.” However, it is well-known the stock market is a forward-looking beast, and with this in mind, Zhu thinks the quarter has “already been consigned to irrelevance, on the back of a game-changing analyst call.” “For a company not always known for guiding concisely, this quarter felt like directional change,” Zhu went on to say. “The plan going forward is clear: leverage food delivery, quick commerce, and AI to drive engagement across the company’s vast ecosystem.” Although July and August involved significant spending on acquiring users and riders, an outlook that stated losses in the food delivery unit could be cut in half by October was “far more constructive” than Zhu expected, suggesting Q2 will likely mark the peak in losses – even though they will have doubled compared with Q1. Alibaba’s ambition to become China’s top player in food delivery and quick commerce is a clear challenge to Meituan, especially coming just two days after Meituan struggled to outline how it intends to deal with the threat. Recent trends indicate that Alibaba has been able to gain substantial food delivery and quick commerce share while only modestly increasing spending relative to Meituan. On the AI front, management highlighted the RMB38.7 billion ($5.42 billion) in capex this quarter as a sign of robust demand for both inference and training, and indicated they expect revenue growth to continue accelerating in the coming quarters. “Looking back,” Zhu explained, “our upgrade of Alibaba’s shares earlier this year during peak DeepSeek excitement was poorly timed. But our belief at the time – that AI investments would help steer Alibaba towards more gainful capital allocation – now appears to be taking shape.” Bottom line, Zhu maintained an Outperform (i.e., Buy) rating on BABA shares and raised his price target from $145 to $160, implying the stock will gain 18.5% in the months ahead. (To watch Zhu’s track record, click here) There’s strong support elsewhere on the Street for BABA; based on a mix of 12 Buys vs. 1 Hold, the stock claims a Strong Buy consensus rating. At $152.63, the average target factors in a one-year gain of 13%. (See Alibaba stock forecast) <figure><img width="1024" height="551" src="https://imageproxy.pbkrs.com/https://blog.tipranks.com/wp-content/uploads/2025/09/image-68-1024x551.png?x-oss-process=image/auto-orient,1/interlace,1/resize,w_1440,h_1440/quality,q_95/format,jpg" original-src="https://imageproxy.pbkrs.com/https://blog.tipranks.com/wp-content/uploads/2025/09/image-68-1024x551.png"/></figure> To find good ideas for stocks trading at attractive valuations, visit TipRanks’ Best Stocks to Buy, a tool that unites all of TipRanks’ equity insights. Disclaimer: The opinions expressed in this article are solely those of the featured analyst. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment. Disclaimer &amp; DisclosureReport an Issue</div>

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Alibaba's Q1 results missed estimates, but shares surged 13% following a positive earnings call. Revenue was $34.57 billion, up 2% year-over-year, but fell short by $910 million. Bernstein analyst Robin Zhu described the quarter as "mediocre" but noted a "game-changing" analyst call indicating a clear strategy focusing on food delivery, quick commerce, and AI. Zhu maintained an Outperform rating and raised the price target from $145 to $160, suggesting an 18.5% potential gain. The stock has a Strong Buy consensus rating with an average target of $152.63, indicating a 13% one-year gain.

- Alibaba's June quarter results showed a revenue of $34.57 billion, missing estimates by $910 million, yet shares surged by 13%.  
- The company's cloud business experienced significant growth, with Alicloud revenue rising by 25.8%, and AI-driven revenue exceeding 20% of external Cloud revenue.  
- Analyst Robin Zhu maintained an Outperform rating on BABA shares, raising the price target from $145 to $160, indicating a potential 18.5% gain in the coming months.

Alibaba Stock: Bernstein Hails “Game-Changing” Earnings Call