Alibaba Group Holding Ltd. (NYSE:BABA) is making a powerful comeback, and Wall Street is taking notice. After facing a challenging few years marked by regulatory pressure and internal restructuring, Alibaba stock has rallied over 50% in the past year. Now, investors are wondering: is this just the beginning?
The Chinese tech giant is tightening its focus on core strengths—e-commerce, artificial intelligence (AI), and cloud computing—while shedding non-essential units to boost efficiency. This sharpened strategy appears to be paying off, positioning Alibaba stock for renewed growth in 2025 and beyond.
AI Cloud Services Fuel Alibaba Stock’s Growth Potential
Alibaba Cloud is quickly becoming the company’s most promising growth engine. In the most recent quarter, cloud revenues rose 18% year-over-year, powered by demand for AI-driven services. According to management, AI product revenue has grown by triple digits for seven consecutive quarters—a strong signal of scalability and long-term value.
This success reflects broader AI adoption across industries. From small businesses to large enterprises, companies are integrating AI tools to enhance efficiency, reduce costs, and gain competitive advantages. Alibaba is investing heavily in the infrastructure needed to support this transition.
Sectors such as manufacturing, agriculture, and healthcare are now using Alibaba’s cloud-based AI services for everything from supply chain optimization to predictive analytics. The company’s early and aggressive move into AI could give Alibaba stock a significant edge as the technology matures.
E-Commerce Still a Reliable Driver for Alibaba Stock
Although cloud and AI are grabbing headlines, Alibaba’s core e-commerce business remains rock solid. Flagship platforms like Taobao and Tmall continue to show strong performance. Premium loyalty membership (88VIP) has surpassed 50 million users, a key indicator of sustained consumer engagement.
In the latest quarter, revenue from customer management services—a proxy for merchant activity—increased 12% year-over-year, while adjusted EBITA climbed 8%. These gains highlight the company’s ability to grow profitably, even in a competitive retail environment.
International growth also plays a role. Alibaba International Digital Commerce (AIDC), its cross-border e-commerce division, reported a 22% revenue increase over the previous year. The company expects international operations to reach full profitability in the current fiscal year—a milestone that could provide further tailwinds for Alibaba stock.
Wall Street Analysts Are Bullish on Alibaba Stock
Alibaba’s renewed focus on AI, cloud, and e-commerce is resonating with analysts. Most give Alibaba stock a “Strong Buy” rating, and the consensus price target of $157.91 implies a 33% upside from current levels.
The company’s solid financials, strong presence in high-growth sectors, and improving operational efficiency suggest that Wall Street’s optimism is well-founded. As AI continues to disrupt industries globally, Alibaba’s dual strength in tech and commerce gives it a unique competitive advantage.
Should You Buy Alibaba Stock Now?
If you’re seeking exposure to high-growth trends like AI and cloud computing while staying grounded in a proven e-commerce model, Alibaba stock deserves a closer look. The company’s commitment to innovation, profitability, and global expansion is building a compelling long-term story.
Given its current momentum, strategic focus, and analyst support, Alibaba stock appears well-positioned to climb even higher in the coming months.
Featured Image: Megapixl
