In recent days, Alibaba and institutions have disc

In recent days, Alibaba and institutions have discussed the latest quarterly results, and the tone has been cautious. This has driven the stock to pull back over the past few sessions. Dolphin Research shares the key takeaways below:

1) Taotian CMR growth slowing to low-to-mid single digits: Management now expects core CMR YoY growth to likely slow to within 5% (currently 3%–5%). The backdrop is tougher after state subsidies faded and the sector entered a high base, putting pressure on the broader e-comm market.

In addition, the incremental technology service fees and platform-wide initiatives rolled out since Sep are now lapping a high base, so CMR growth is converging toward GMV growth.

While the sequential deceleration in CMR is clearly a negative and has weighed on the stock, these headwinds were not unexpected. They are not negative surprises vs. prior expectations.

2) Taobao Flash (on-demand) showed decent 4Q progress; reiterated commitment to heavy investment: The new quarter loss is expected to be slightly over RMB 20 bn, a clear narrowing vs. the RMB 36 bn loss disclosed last quarter. Per-order loss improved from a bit over RMB 5 last quarter to about RMB 3.5, broadly in line with earlier guidance on loss narrowing.

Moreover, management indicated Taobao Flash maintained roughly stable order-share while gaining GMV-share. The mix shift likely came from a higher proportion of higher-priced meal orders and fewer low-priced drink orders.

This suggests further optimization of order structure, supporting UE improvement. It is broadly consistent with our prior view, and even a touch better.

Perhaps encouraged by the latest progress, Alibaba reiterated it will keep investing heavily in Flash through 2026. Management also set a goal to reach No. 1 market share.

As for this Flash battle, Dolphin Research’s simple take is: it remains uncertain whether Flash will ultimately boost Alibaba’s profits. But it is clearly a negative for Meituan either way.

3) Cloud remains solid: Cloud revenue is expected to grow 35% YoY this quarter vs. 34% last quarter. No major acceleration, so no surprise, but in line with prior guidance for sustained high growth.

Cloud margins remain broadly stable and similar to last quarter.

That said, there is some improvement under the hood. Last quarter’s robust growth was driven mainly by internal demand with external revenue up only 29% YoY.

This quarter, external revenue growth is expected to accelerate meaningfully to around 35%, indicating improving momentum for Alibaba Cloud.

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