Alibaba's June-quarter 2025 results marked the start of a heavy dual-investment cycle in AI+cloud and consumption. Total revenue grew 10% like-for-like, CMR rose 10%, and cloud accelerated to 26% growth with an 8th consecutive quarter of triple-digit AI product growth, while GAAP net income jumped 76% on investment and Trendyol disposal gains. The company combined Taobao/Tmall, Ele.me, and Fliggy into Alibaba China E-Commerce Group and rapidly scaled Taobao Instant Commerce to 120 million peak daily orders and ~300 million MAC. Aggressive spending, however, cut total adjusted EBITA 14% and produced an RMB 18.8 billion free cash flow outflow amid ~RMB 39 billion quarterly CapEx. Management committed CNY 380 billion to three-year AI/cloud infrastructure and CNY 50 billion to consumption, targeting CNY 1 trillion in quick commerce GMV within three years.
Good day, everyone. Welcome to Alibaba Group's June Quarter 2025 earnings conference call. With us today are Joe Tsai, Chairman; Eddie Wu, Chief Executive Officer; Toby Xu, Chief Financial Officer; and Jiang Fan, Chief Executive Officer of Alibaba E-Commerce Business Group. This call is also being webcast from the IR section of our corporate website. A replay of the call will be available on our website later today. Now, I will quickly cover the safe harbor. Today's discussions may contain forward-looking statements, particularly statements about our business and financial results that are subject to risks and uncertainties which could cause actual results to differ materially from those contained in the forward-looking statements. Please refer to the safe harbor statements that appear in our press release and investor presentation provided today. Please note that certain financial measures that we use on this call are expressed on a non-GAAP basis.
Our GAAP results and reconciliations of GAAP to non-GAAP measures can be found in our earnings press release. Now I will turn the call over to Eddie.
[Foreign language]
Hello everybody, and welcome to this quarter's earnings call. This quarter, we delivered solid growth. Excluding revenue from Sun Art and Intime, our total revenue on a like-for-like basis grew 10% year-over-year. Revenue growth of our core businesses remained strong. Customer management revenue from our China e-commerce business rose 10% year-over-year. Cloud Intelligence Group revenue growth accelerated to 26% year-over-year, with AI-related product revenue maintaining triple-digit growth for the eighth consecutive quarter. Revenue from AIDC grew by 19% year-over-year. In AI + Cloud, the accelerated development of AI applications and increasing AI product adoption by customers drove a 26% year-over-year revenue increase from external customers. During the quarter, AI-related revenue accounted for over 20% of revenue from external customers as AI demand continued to grow rapidly. We're also seeing AI applications driving great growth momentum of traditional products, including compute and storage.
SAP and Alibaba entered a strategic partnership focused on cloud and AI. As SAP's global cloud computing partner, Alibaba Cloud will support SAP customers to run and manage their core software systems on Alibaba's platform. Leveraging our Qwen models, SAP will also provide AI transformation services for its enterprise customers. This partnership signifies the recognition of our cloud infrastructure and AI capabilities by the global leading enterprises in the SAP ecosystem. We've continued to advance the capabilities of our AI foundation model. Since July, Alibaba has released upgraded Qwen3, including a non-thinking model, reasoning model, and AI coding model, which are recognized as global top performers in their respective categories. Notably, our Qwen3-Coder model has rapidly increased Qwen's user adoption in overseas markets. We also open-sourced several models such as the video generation model WAN 2.2 and the text-to-image model Qwen-Image.
By continuously upgrading our open-source models, we're empowering our customers to develop their own AI applications. Meanwhile, Alibaba's own AI-native applications continue to advance. Amap has undertaken a comprehensive AI transformation with the launch of Amap 2025, the world's first AI-native location-based application. The upgrade brings spatial intelligence into dynamic real-world scenarios, and Amap is well positioned to become a new gateway for future lifestyle services. ThinkTalk has also completed its latest AI upgrade, creating the world's first agent-driven work feeds to explore next-generation workplace application paradigms. On our Taobao platform, we see immense AI-powered opportunities emerging, such as AI search and AI advertising platform. In consumption, we undertook a strategic combination of Taobao and Tmall Group, Ele.me, and Fliggy into Alibaba China E-Commerce Group. This organizational change creates a comprehensive consumption platform and upgrades our consumer experience.
We have consolidated supply chains, user bases, and membership benefits across our businesses and launched a tiered loyalty program that connects Ele.me, Fliggy, and Amap. The newly integrated benefits enhance our members' experience across a full spectrum of consumption scenarios. Since May, our investments in quick commerce have rapidly surpassed key milestones and created synergies. In August, monthly active consumers on our quick commerce business are approaching 300 million, contributing to a 25% increase in monthly active consumers on the Taobao app. Daily order volume of our China E-Commerce Group continued to achieve new records. Looking ahead, Alibaba Group has two historic opportunities: to build a technology platform centered on AI + Cloud and to create a comprehensive shopping and daily life services consumption platform. We will invest at scale to capture the opportunities. This also marks a new entrepreneurial chapter for the company after 26 years.
In line with this, in February, we announced an investment of CNY 380 billion over the next three years to build our cloud and AI infrastructure. In July, we announced plans to invest CNY 50 billion in consumption. The transformative impact of AI on all industries, combined with the deep integration of AI and cloud, will present the most significant opportunity in the technology sector over the next decade. For Alibaba, we have the world's fourth largest and Asia's leading cloud infrastructure, along with full stack technology capabilities spanning AI computing power, AI cloud platforms, AI models, an open source ecosystem, and AI applications. This quarter, our CapEx investment in AI and cloud infrastructure reached CNY 38.6 billion. Over the past four quarters, we have cumulatively invested over CNY 100 billion in AI infrastructure and AI product R&D. Our investments in AI have begun to yield tangible results.
This is evidenced by Alibaba Cloud's return to rapid growth, driven by AI demand and our AI-enhanced experiences across consumer and enterprise-facing scenarios. We're seeing an increasingly clear path for AI to drive Alibaba Group's robust growth. We're also well positioned in China, the world's largest e-commerce market and the most promising service consumption market. China has a well-developed e-commerce infrastructure, high population density, and strong demand for service consumption, providing a solid foundation for the integration of our quick commerce business and the Taobao app. We believe this convergence will fulfill consumer needs for a one-stop consumption experience and meet merchants' desire to serve consumers across multiple scenarios. It will enhance commerce efficiency and pave the way for an all-in-one AI assistant for consumption. Alibaba's strategic positioning in quick commerce has ambitions beyond competing in a single category.
We aim to meet the one-stop consumption needs of our 1 billion consumers and shape business models of a comprehensive consumption platform in the AI era. In consumption, our long-term goal is to create a comprehensive consumption platform catering to our 1 billion consumers' full spectrum of shopping and daily life needs. We aim to offer the best experience to the largest consumer base with the highest purchase frequency, ultimately leading in an CNY 30 trillion addressable market. Over the next three years, Alibaba will embark on a new journey with an entrepreneurial mindset to drive robust business growth through sustained investments centered on the strategic areas of consumption and AI + Cloud. We're confident that these investments in the core business will sharpen our competitive edge and fuel long-term growth. Thank you.
Thank you, Eddie. As Eddie said, we are embarking on a new chapter of entrepreneurship by investing in two strategic pillars of consumption in the AI + Cloud. These represent the two biggest long-term opportunities we are systematically pursuing. To reflect this sharpened focus, we have also adjusted our financial reporting accordingly. Starting from this quarter, we undertook a strategic combination of Taobao and Tmall Group, Ele.me, and Fliggy into Alibaba China E-Commerce Group, transforming our value proposition into a comprehensive consumption platform. This is not simply an organizational change; it's a major strategic investment aimed at redefining the consumer experience and unlocking long-term value across our ecosystem. This quarter marked meaningful progress on this front as we deepen investment in quick commerce, an increasingly essential use case for capturing new demand and shaping future consumer experience.
Our quick commerce business achieved key milestones while contributing to the 25% year-over-year growth in the Taobao app monthly active consumers in the first three weeks of August. In tandem, we are building the AI + Cloud infrastructure to support the next wave of technological transformation, positioning Alibaba as a key enabler of enterprise AI adoption across industries. Our cloud business delivered accelerated growth as segment revenue and revenue from external customers both grew 26%, driven by surging AI demand and increased customer adoption of public cloud services to support AI workloads. At the same time, we remain focused on improving operating efficiency and profitability. In the quarter, AIDC delivered solid progress, approaching break-even while sustaining strong growth momentum. Now, let's look at the financial results on a consolidated basis. Total revenue was CNY 247.7 billion.
Excluding revenue from Sun Art and Intime, revenue on a like-for-like basis would have grown by 10% year-over-year. The adjusted EBITA decreased 14%, primarily due to our strategic focus on scaling quick commerce to capture new consumption patterns and drive future monetization opportunities, partly offset by margin improvements across several businesses, including AIDC and other units that made continued progress in operating efficiency. Our GAAP net income increased 76%, primarily due to the mark-to-market changes from our equity investments and the gain arising from the disposal of local consumer service business of Trendyol. Operating cash flow was CNY 20.7 billion. Free cash flow was an outflow of CNY 18.8 billion. This was mainly attributed to our accelerated pace on expanding AI + Cloud infrastructure as CapEx ramped up to approximately CNY 39 billion and the investment in Taobao Instant Commerce.
Backed by nearly $50 billion in net cash, a healthy and low-leveraged balance sheet, and our strong access to capital markets, we have ample flexibility to support long-term strategic investments while maintaining financial resilience. This quarter, we bought back approximately 7 million ADSs for a total of $815 million in our share repurchase program. We remain committed to shareholders' return through a mix of share buybacks, dividends, and investment for growth, and we will continue to adjust the pace and form of returns based on market conditions and strategic priorities. Now, let's look at the segment results, starting with Alibaba China E-Commerce Group. Revenue from Alibaba China E-Commerce Group was CNY 140.1 billion, an increase of 10%. Customer management revenue of our e-commerce business increased by 10%, primarily driven by the improvement of take rate.
We had a successful June 18th shopping festival, which delivered strong consumer growth on the Taobao app. As we implemented user-friendly promotion mechanisms and increased the support for merchants that provide high-quality products and customer services, the number of 88 VIP members, our high-spending consumers group, continued to increase by double digits year-over-year, surpassing 53 million. Revenue from our quick commerce business increased 12%, mainly due to order growth as a result of rollout of Taobao Instant Commerce at the end of April. Since its launch, we have seen encouraging business progress, reflecting strong user adoption and growing order momentum. In the meantime, we have expanded our product offerings and front warehouse coverage for non-food categories as part of our efforts to improve user experience and enhance operating efficiency.
We executed our plan to generate synergies between quick commerce and the rest of Alibaba's ecosystem by leveraging supply chains, users, and membership benefits across our businesses. In August, the Taobao app launched a tiered loyalty program that connects Alibaba Group's China e-commerce, quick commerce, and travel platforms. The adjusted EBITA from Alibaba China E-Commerce Group decreased by 21%, excluding the investments in our quick commerce business. Our Alibaba China E-Commerce Group EBITA has grown year-over-year. Revenue from AIDC grew 19%, primarily driven by strong performance in cross-border businesses. AIDC's adjusted EBITA loss narrowed significantly, approaching break-even. As we continue to improve our operating efficiency, the UE of choice and the Trendyol's international business improved significantly on a sequential basis. Looking ahead, we are committed to enhancing operating and investment efficiency. As a result, our profitability will continue to improve.
Cloud segment revenue grew by 26%, primarily driven by public cloud revenue growth. AI revenue continued its triple-digit growth. As AI demand continues to grow rapidly, we are also seeing increasing demand of compute, storage, and other public cloud services to support AI adoption. The adjusted EBITA margin remained relatively stable year-over-year at 8.8%. We will continue to invest in customer growth and technological innovation, including AI products and services, to increase cloud adoption for AI and maintain our market leadership. As previously mentioned, we have updated our segment reporting to better reflect our focus. We simplified the financial reporting structure by reclassifying Cainiao, Amap, and Hujing DME into "All others". All other segment revenue decreased by 28%, primarily due to the disposal of Sun Art and Intime.
All others adjusted EBITA was a loss of CNY 1.4 billion, primarily due to the increased investment in technology businesses, partly offset by the improved results of businesses, including Freshippo. The all other segment comprises a set of innovative initiatives, including several strategic AI-driven technology infrastructure and businesses. While we continue to drive efficiency improvements across business lines, we are also investing in AI opportunities to maintain our competitive edge and to drive future growth. In closing, this quarter marked meaningful progress in our strategic investment on two pillars that will power Alibaba's next phase of growth: our comprehensive consumption platform and AI + Cloud infrastructure. In commerce, the integration of multiple businesses under Alibaba China E-Commerce Group is driving stronger synergy across supply chains, user networks, and membership programs, enabling us to better serve evolving consumer needs and capture long-term growth potential.
In cloud, revenue growth accelerated on the back of robust AI-driven demand. As we expand infrastructure capacity, we are helping more customers deploy and scale their AI workloads. We are investing with clarity and conviction on the two historical opportunities ahead: AI and domestic consumption. Our commitment of CNY 380 billion technology investment reflects our long-term ambition to build the infrastructure essential for AI proliferation, while our focused expansion in quick commerce is designed to unlock new demand and long-term consumption potential in China. With strong balance sheet, operating cash flow, and business momentum, we are well positioned to support these investments, drive sustainable growth, and strengthen core capabilities that will define Alibaba's future. Thank you. That's the end of our prepared remarks. We can open up for Q&A.
Hi everyone. For today's call, you are welcome to ask questions in Chinese or English. A third-party translator will provide consecutive interpretation for the Q&A session. Please note that the translation is for convenience purposes only. In the case of any discrepancy, our management statement in the original language will prevail. If you are unable to hear the Chinese translation, bilingual transcripts of this call will be available on our website within one week after the end of the meeting.
[Foreign language]
Operator, please start Q&A session. Thank you.