Alibaba (BABA) is an e-commerce and technology infrastructure provider. The company performs through seven segments: China Commerce, International Commerce, Cloud, Digital Media and Entertainment, Cainiao, Local Consumer Services, and Innovation Initiatives. Among other things, it provides merchants and small business owners a platform on which to market and sell their products.

Alibaba’s stock has had its ups and downs this year. Although the stock has gained nearly 50% in the year to date, it is still 15% below its 52-week high due to tensions between the U.S. and China related to tariffs. In a 52-week timeframe, the stock has gained more than 55%.

Alibaba’s Strong Quarterly Performance

Alibaba reported strong fourth-quarter results. The company reported a profit of $2.93 per share against the market’s $2.66-per-share estimate. The company generated $38.38 billion in revenue, also outpacing analysts’ $38.1 billion estimate.

Alibaba’s recent results show strong core business growth. Its China Commerce Sector grew 5% year-over-year, the Cloud Intelligence Sector grew 13%, the International Digital Commerce Group had a significant 32% growth, while the Digital Media sector reported 8% growth. Only Cainiao, its logistics segment, reported a fall of 1%, citing restructuring costs.

During the quarter, the company had an operating margin of 15%, better than the 9% reported in the same quarter last year. Adjusted EBITDA came at $8.50 billion, registering a 4% rise year-over-year. 

Alibaba held cash and equivalents of $22.3 billion as of Dec. 31. 

Alibaba Is a Top AI Pick

Based on analysts tracked by Barchart.com, Alibaba is a top AI pick. This is thanks to its “Strong Buy” consensus rating and analyst score of 5 out of 5. 

Alibaba has been investing heavily in artificial intelligence (AI) with its Qwen3 AI models. The Qwen3 models are able to switch between fast responses and deep analytical thinking by using hybrid reasoning. This makes the models highly adaptable for different uses.

Alibaba’s Qwen3 series includes eight models, starting from 600 million to 235 billion parameters. Currently, these models are available as open source, allowing developers to utilize them.

Alibaba’s push for AI comes as it looks to compete against DeepSeek, Google (GOOGL), and OpenAI. According to reports, Alibaba’s models are performing well in areas such as instruction following, mathematical reasoning, and coding assistance. Alibaba has also integrated cloud computing infrastructure into its AI models, reaffirming its commitment to AI growth.

Analyst Takes on BABA Stock 

Alibaba’s solid financial position and AI growth give it plenty of support on Wall Street. Twenty analysts have a unanimous “Strong Buy” rating and a mean price target of $158.20, reflecting upside potential of 25% from the market price.