所有都与人工智能有关；其他的都不那么重要

It's All About AI; Rest LessImportant Earnings Preview We are previewing Sep-Q but AI drives valuation creation forBABA shareholders in the next 5-10 years; Reiterate OW andPT $190 With reported $500bn valuation of OpenAI in its latest round, the most important driver forvaluation creation for shareholders of BABA, one of the most dominant AI players in China, ishow the company continues to maintain and strengthen its dominant position in AI regardlesswhat the eventual use cases for AI are going to be. Arguably, BABA has the biggest portfolio of AI models in China and continues to lead theindustry's transition from LLM training to AI agent development and eventually to Edge AI.Similar to OpenAI's AI agent development platform, BABA's Agentic ADK (Agent DevelopmentKit) is an open framework to help developers to build and deploy AI agents. The ultimate goalfor all leading AI players around the world is to have their LLM and agent development platformto become the standard or foundation upon which developers build applications and AI agents.We consider BABA has as good a chance as any aspiring tech company in China to become thatstandard. We believe BABA should be All- In in AI to establish an unquestioned leadershipposition. Market Cap (USD mn)398587Shares Outstanding (mn)2386.04Free Float (%)N/A52 Wk Avg Daily Volume (mn)20.1Dividend Yield (%)0.63Return on Equity TTM (%)15.20Current BVPS (USD)425.16Source: Bloomberg Price PerformanceExchange-NYSE52 Week rangeUSD 192.67-79.42 With respect to Sep-Q results, we expect BABA to achieve roughly 10% yoy CMR growth withquick commerce indirectly contributing some incremental growth. Despite the enormous losses,estimated to be 35-40bn RMB (~$5bn) from quick commerce in Sep-Q, the worse is likely overand losses from quick commerce should start to decline significantly as early as Dec-Q. With thesignificant investments over the last couple of quarters in quick commerce, BABA hasachieved ~20% DAU growth and 40-45% share in quick commerce, in our estimate. We havetweaked our estimates. The most important metrics investors will likely focus on include the growth rate of AliCloud andits margins. While we don't think investors should overly emphasize on cloud margins, wenevertheless consider BABA has been able to maintain its cloud EBITA margins stable at thecurrent high single digit range. AliCloud growth has been accelerating for the last severalquarters and we believe this trend will continue. In addition, we believe there are tremendousopportunities for Alicloud outside of China. While the US and China are the two leading AIpowers in the world, there are vast parts of the world that will need AI and they may need to atleast partially lean on one of the two AI powers, and AliCloud should have its fair share. In thenear term, we consider Southeast Asia and Midle East to be significant overseas markets forAlicloud. Longer term, we consider parts of Europe can potentially also be attractiveopportunities given today's changes in the geopolitical landscape. Source: IDCLink to Barclays Live for interactive charting China TechnologyJiong Shao, CFA+1 212 526 5562jiong.shao@barclays.comBCI, US Lian Xiu (Roger) Duan+1 212 526 4633lianxiu.duan@barclays.comBCI, US Barclays Capital Inc. and/or one of itsaffiliatesdoes and seeks to do business with companiescovered in its research reports. As a result, investors should be aware that the firm may have aconflict of interest that couldaffectthe objectivity of this report. Investors should consider thisreport as only a single factor in making their investment decision. Xinyao Song+1 212 526 6972xinyao.song@barclays.comBCI, US Please see analyst certifications and important disclosures beginning on page 5.Completed: 20-Oct-25, 10:44 GMTReleased: 20-Oct-25, 10:48 GMTRestricted - External Estimate Changes and PT We largely maintain our revenue estimates. With unchanged 12.5x FY27 EV/EBITA multiple oncore commerce revenue, our PT remains at $190. We reiterate our OW rating. Analyst(s) Certification(s):We, Jiong Shao, CFA and Lian Xiu (Roger) Duan, hereby certify (1) that the views expressed in this research report accurately reflect our personal views about any or all of the subject securities or issuers referred to in this research report and (2) no part of our compensation was, is or will be directly orindirectly related to the specific recommendations or views expressed in this research report. Important Disclosures: Barclays Research is produced by the Investment Bank of Barclays Bank PLC and itsaffiliates(collectively and each individually, "Barclays"). Allauthors contributing to this research report are Research Analysts unless otherwise indicated. The publication date at the top of the report reflects thelocal time where the report was produced and maydifferfrom the release date provided in GMT. Availability of Disclosures:Where any companies are the subject of this research report, for current important disclosures