--- title: "\"Big Banks\" Citigroup: Alibaba's third fiscal quarter performance misses expectations, cloud business revenue growth accelerates to 36%" type: "News" locale: "en" url: "https://longbridge.com/en/news/279881146.md" description: "Citi released a report stating that Alibaba's performance in the third quarter of fiscal year 2026 was below expectations, with total revenue increasing by 2% year-on-year to RMB 284.8 billion, and non-GAAP net profit plummeting by 66.7% year-on-year to RMB 17.1 billion. The Cloud Intelligence Group's revenue grew by 36% to RMB 43.3 billion, slightly above expectations. The overall adjusted EBITA was RMB 23.4 billion, below expectations. Citi maintains a \"Buy\" rating on Alibaba with a target price of $197" datetime: "2026-03-20T03:05:31.000Z" locales: - [zh-CN](https://longbridge.com/zh-CN/news/279881146.md) - [en](https://longbridge.com/en/news/279881146.md) - [zh-HK](https://longbridge.com/zh-HK/news/279881146.md) --- # "Big Banks" Citigroup: Alibaba's third fiscal quarter performance misses expectations, cloud business revenue growth accelerates to 36% Citi published a research report indicating that Alibaba-W (09988.HK) reported weaker-than-expected performance for the third quarter of fiscal year 2026, with total revenue growing 2% year-on-year to RMB 284.8 billion, which is 1.7% lower than the bank's and market expectations. Non-GAAP net profit plummeted 66.7% year-on-year to RMB 17.1 billion, 40% lower than the bank's expectations. Adjusted EBITA was RMB 23.4 billion, below the bank's expectation of RMB 27.7 billion, with a profit margin of 8%, down from 19.6% in the same period last year. The report stated that revenue for the Chinese e-commerce group grew 6% year-on-year to RMB 159.3 billion, with customer management revenue (CMR) growing 1% year-on-year to RMB 102.7 billion, roughly in line with the bank's expectations; instant retail business (Taobao Instant and Ele.me) revenue grew 56% year-on-year to RMB 20.8 billion, 14% lower than the bank's expectations. Revenue for Alibaba International Digital Commerce Group grew 4% year-on-year to RMB 39.2 billion, below the bank's expectations. Cloud Intelligence Group revenue grew 36% year-on-year to RMB 43.3 billion, slightly above the bank's and market expectations, with a profit margin of 9%, in line with expectations. Revenue from "all other" businesses fell 25% year-on-year to RMB 67.3 billion, compared to the bank's expectation of RMB 65.5 billion. Citi pointed out that a positive factor in the performance was the slight acceleration in cloud business revenue growth to 36%, slightly above expectations. However, CMR grew only 1%, and adjusted EBITA for Chinese e-commerce was below expectations. Overall adjusted EBITA was also below forecasts, mainly reflecting a decrease in profit contribution from the e-commerce business. Capital expenditure during the period was RMB 29 billion, lower than the bank's expectation of RMB 32 billion. The bank is focused on the management's latest views on several topics during the earnings call, including: the adoption of the Clawbot product and its impact on Tongyi Qianwen and Alibaba Cloud services; macro outlook reflected by online sales data from January and February; potential contributions of artificial intelligence to CMR growth; capital expenditure and chip development; expected losses in food delivery and instant e-commerce; revenue growth and profit margins in the cloud business; and shareholder return policies. Citi maintains a "Buy" rating on Alibaba (BABA.US), with a target price of $197 based on the SOTP valuation method ### Related Stocks - [09988.HK](https://longbridge.com/en/quote/09988.HK.md) - [BABA.US](https://longbridge.com/en/quote/BABA.US.md) - [KBAB.US](https://longbridge.com/en/quote/KBAB.US.md) - [KWEB.US](https://longbridge.com/en/quote/KWEB.US.md) - [513770.CN](https://longbridge.com/en/quote/513770.CN.md) - [PGJ.US](https://longbridge.com/en/quote/PGJ.US.md) - [IBUY.US](https://longbridge.com/en/quote/IBUY.US.md) - [YINN.US](https://longbridge.com/en/quote/YINN.US.md) - [513040.CN](https://longbridge.com/en/quote/513040.CN.md) - [EBIZ.US](https://longbridge.com/en/quote/EBIZ.US.md) - [DTCR.US](https://longbridge.com/en/quote/DTCR.US.md) - [BABX.US](https://longbridge.com/en/quote/BABX.US.md) - [ONLN.US](https://longbridge.com/en/quote/ONLN.US.md) - [CLOU.US](https://longbridge.com/en/quote/CLOU.US.md) - [BABO.US](https://longbridge.com/en/quote/BABO.US.md) ## Related News & Research - [Alibaba sets up top tech committee led by CEO to sharpen AI push](https://longbridge.com/en/news/282105743.md) - [Chinese startup ShengShu raises $293 million to advance artificial general intelligence](https://longbridge.com/en/news/282272214.md) - [Alibaba's New AI Video-Generation Model Tops Global Ranking After Debut](https://longbridge.com/en/news/282295136.md) - [Alibaba takes on Seedance as AI rivalry offers glimpse into race for top talent](https://longbridge.com/en/news/282353775.md) - [Beyond Chatbots: Alibaba's $290 Million Push For Real-World AI Begins](https://longbridge.com/en/news/282338340.md)