Chinese e-commerce giant Alibaba (BABA) is set to report its fiscal Q4 2025 earnings on Thursday, May 15. The stock has jumped over 45% year-to-date, backed by a rebound in core e-commerce sales, solid financial results, and rising investor faith in its AI and cloud businesses. Adding to the momentum, Alibaba recently confirmed a key AI deal with Apple (AAPL), which will use Alibaba’s Qwen 2.5 model in iPhones sold in China. This move shows Alibaba’s growing role in China’s AI market and supports its long-term growth plans. Given BABA’s solid growth story and strong fundamentals, Wall Street analysts remain positive on the stock ahead of its Q4 results.
What to Expect from BABA’s Q4 Earnings
Wall Street analysts expect Alibaba to report earnings of $1.74 per share for Q4, up 24% from the year-ago quarter. Meanwhile, analysts project Q4 revenues at $33.1 billion, according to the TipRanks Analyst Forecasts Page. The figure marks a year-over-year increase of over 7%.
Alibaba Rides E-Commerce Recovery and AI Push
Alibaba is seeing a steady rebound in its core e-commerce business, driven by growing momentum in its main shopping platforms, Taobao and Tmall. In the December 2024 quarter, customer management revenue, which includes seller services like ads and analytics, rose 9% year-over-year.
To further grow its reach in China, Alibaba recently partnered with lifestyle platform RedNote (also known as Xiaohongshu). The deal lets users shop on Taobao directly through the RedNote app, making it easier for younger users to shop while enjoying content. It’s part of Alibaba’s strategy to regain market share from fast-growing rivals like PDD Holdings (PDD) and Douyin.
On the technology side, Alibaba is making big moves in AI. Its Qwen AI models are now some of the most used in China, with thousands of developers creating new models based on its open-source platform. Also, Alibaba’s recent deal with Apple, where Apple will use Alibaba’s Qwen 2.5 AI model in iPhones sold in China, is seen as a major vote of confidence in Alibaba’s AI tech. Alibaba has also announced a $53 billion investment plan over the next three years to boost its cloud and AI strength.
Top Analyst Bullish on BABA’s Cloud Growth
Barclays five-star analyst Jiong Shao recently reiterated an Overweight rating on Alibaba’s stock with a price target of $180 per share. He noted that cloud revenue accelerated in the March quarter and is expected to remain robust for the rest of the year. It’s important to highlight that in the third quarter of fiscal 2025, Alibaba’s cloud revenue rose 13% year-over-year to ¥31.7 billion ($4.3 billion).
As China transitions from training AI models to applying them in real-world scenarios like inferencing and edge computing, Shao believes Alibaba is in a favorable position to benefit.
Is BABA a Good Stock to Buy Now?
Analysts remain highly bullish about Alibaba’s stock trajectory. With 16 unanimous Buy ratings, BABA stock commands a Strong Buy consensus rating on TipRanks. Also, the average Alibaba price target of $167.13 implies 32.86% upside potential from current levels.
