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<Research>CICC Forecasts BABA-W's E-commerce Rev. & Profit to Subside This Yr, Cloud Computing to Grow Rapidly
Recommend 44 Positive 50 Negative 28 |
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CICC has published a research report predicting that BABA-W (09988.HK) will log a 4.6% YoY increase in revenue to RMB293.1 billion in 3QFY26 (4Q25), while its adjusted EBITA will decline by 50% YoY to RMB27.7 billion, with profits falling below expectations due to poor e-commerce performance and expanded losses in other businesses. Specifically, CICC estimates BABA-W's China e-commerce profit to slip by 42% YoY to RMB34.8 billion in 3QFY26. Because of larger investment during peak seasons, the company's core e-commerce, after excluding Taobao Instant Commerce, will record a negative YoY growth. Overall, its e-commerce revenue and profit are expected to cave under pressure in 2026. In contrast, CICC anticipates BABA-W's cloud computing revenue to surge by 36% YoY during the same period. Its external revenue is also projected to increase by 32% YoY, compared to the previous quarter's 29%. The EBITA profit margin for cloud computing is likely to reach 9%. CICC has set its target price for BABA-W at HKD197 and, upbeat about the growth potential of its cloud computing, kept the Outperform rating unchanged. AAStocks Financial News |
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