Alibaba Group Holding Ltd
BABA20-F,fiscal year ended Mar 31, 2026,filed May 20, 2026,Original on SEC.gov (opens in a new tab)
5 of 5 risk excerpts located in the filing text
Coverage details
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The Print
Alibaba's FY2026 revenue rose 3% to RMB1,023,670 million while net income fell 19% to RMB102,127 million and income from operations dropped 64% to RMB50,150 million.
Income from operations decreased 64% from RMB140,905 million, or 14% of revenue, in fiscal year 2025 to RMB50,150 million, or 5% of revenue, in fiscal year 2026; the filing attributes the decrease primarily to the decrease in adjusted EBITA and increase in impairment of goodwill, partly offset by the decrease in one-time provisions and non-cash share-based expenses. Net income decreased 19% or RMB23,849 million, which the filing attributes primarily to the decrease in income from operations, partly offset by the year-over-year increase in net gain from mark-to-market changes of equity investments and net gains from disposal of investments.
- Revenue of RMB1,023,670 million (US$148,401 million) in FY2026, up 3% from RMB996,347 million in FY2025; excluding disposed Sun Art and Intime businesses, like-for-like revenue would have grown 11%.
- Net income of RMB102,127 million (US$14,805 million), down 19% from RMB125,976 million, with income from operations falling 64% to RMB50,150 million.
- Diluted earnings per ADS of RMB44.00 (US$6.38) versus RMB53.59 in FY2025; basic EPS of RMB5.70 versus RMB6.89.
- Cloud Intelligence Group revenue rose 34% to RMB158,132 million while Alibaba China E-commerce Group adjusted EBITA fell 44% to RMB107,509 million.
Results That Matter
- Revenue
- Current period
- RMB1,023,670 million (US$148,401 million)
The filing states that excluding revenue from the disposed businesses of Sun Art and Intime, revenue on a like-for-like basis would have grown by 11% year-over-year. - Income from operations
- Current period
- RMB50,150 million (US$7,270 million)
The filing attributes the decrease primarily to the decrease in adjusted EBITA and increase in impairment of goodwill, partly offset by the decrease in one-time provisions and non-cash share-based expenses. - Net income
- Current period
- RMB102,127 million (US$14,805 million)
The filing attributes the decrease primarily to the decrease in income from operations, partly offset by the year-over-year increase in net gain from mark-to-market changes of equity investments and net gains from disposal of investments. - Net income attributable to Alibaba Group Holding Limited
- Current period
- RMB103,592 million (US$15,018 million)
Reported as a separate line below consolidated net income after adding back the net loss attributable to noncontrolling interests. - Net income attributable to ordinary shareholders
- Current period
- RMB105,904 million (US$15,353 million)
Includes a reversal of accretion of mezzanine equity of RMB2,312 million in FY2026 versus an accretion of RMB639 million in FY2025. - Earnings per share attributable to ordinary shareholders - Basic
- Current period
- RMB5.70 (US$0.83)
Each ADS represents eight Shares. - Earnings per share attributable to ordinary shareholders - Diluted
- Current period
- RMB5.50 (US$0.80)
Each ADS represents eight Shares. - Earnings per ADS attributable to ordinary shareholders - Basic
- Current period
- RMB45.63 (US$6.61)
Each ADS represents eight Shares. - Earnings per ADS attributable to ordinary shareholders - Diluted
- Current period
- RMB44.00 (US$6.38)
Each ADS represents eight Shares. - Non-GAAP net income
- Current period
- RMB60,658 million (US$8,794 million)
Non-GAAP net income excludes non-cash share-based compensation expense, amortization and impairment of intangible assets, gain or loss on deemed disposals/disposals/revaluation of investments, impairment of goodwill and investments and others, and adjustments for the tax effects. - Non-GAAP diluted earnings per ADS
- Current period
- RMB26.80 (US$3.89)
Non-GAAP diluted earnings per ADS is derived from non-GAAP diluted earnings per share after adjusting for the ordinary share-to-ADS ratio. - Adjusted EBITA
- Current period
- RMB76,416 million (US$11,078 million)
Adjusted EBITA represents net income before interest and investment income, net, interest expense, other income (expense), net, income tax expenses, share of results of equity method investees, and certain non-cash expenses. - Adjusted EBITDA
- Current period
- RMB113,483 million (US$16,452 million)
Adjusted EBITDA further adds back depreciation and impairment of property and equipment, and operating lease cost relating to land use rights.
| Metric | Current Period | Investor Takeaway |
|---|---|---|
| RMB1,023,670 million (US$148,401 million) | The filing states that excluding revenue from the disposed businesses of Sun Art and Intime, revenue on a like-for-like basis would have grown by 11% year-over-year. | |
| RMB50,150 million (US$7,270 million) | The filing attributes the decrease primarily to the decrease in adjusted EBITA and increase in impairment of goodwill, partly offset by the decrease in one-time provisions and non-cash share-based expenses. | |
| RMB102,127 million (US$14,805 million) | The filing attributes the decrease primarily to the decrease in income from operations, partly offset by the year-over-year increase in net gain from mark-to-market changes of equity investments and net gains from disposal of investments. | |
| RMB103,592 million (US$15,018 million) | Reported as a separate line below consolidated net income after adding back the net loss attributable to noncontrolling interests. | |
| RMB105,904 million (US$15,353 million) | Includes a reversal of accretion of mezzanine equity of RMB2,312 million in FY2026 versus an accretion of RMB639 million in FY2025. | |
| RMB5.70 (US$0.83) | Each ADS represents eight Shares. | |
| RMB5.50 (US$0.80) | Each ADS represents eight Shares. | |
| RMB45.63 (US$6.61) | Each ADS represents eight Shares. | |
| RMB44.00 (US$6.38) | Each ADS represents eight Shares. | |
| RMB60,658 million (US$8,794 million) | Non-GAAP net income excludes non-cash share-based compensation expense, amortization and impairment of intangible assets, gain or loss on deemed disposals/disposals/revaluation of investments, impairment of goodwill and investments and others, and adjustments for the tax effects. | |
| RMB26.80 (US$3.89) | Non-GAAP diluted earnings per ADS is derived from non-GAAP diluted earnings per share after adjusting for the ordinary share-to-ADS ratio. | |
| RMB76,416 million (US$11,078 million) | Adjusted EBITA represents net income before interest and investment income, net, interest expense, other income (expense), net, income tax expenses, share of results of equity method investees, and certain non-cash expenses. | |
| RMB113,483 million (US$16,452 million) | Adjusted EBITDA further adds back depreciation and impairment of property and equipment, and operating lease cost relating to land use rights. |
What changed
Year over year, against the 20-F for the year ended Mar 31, 2025.
Prior 20-FRevenue up 2.7%; Net income down 20.4%
| Metric | Prior | Current | Change | Read as |
|---|---|---|---|---|
| Revenue | CN¥996.3B | CN¥1.0T | +2.7% | Favorable |
| Net income | CN¥130.1B | CN¥103.6B | −20.4% | Unfavorable |
| EPS (diluted) | CN¥6.70 | CN¥5.50 | −17.9% | Unfavorable |
- Revenue+2.7%Prior CN¥996.3B, current CN¥1.0TFavorable
- Net income−20.4%Prior CN¥130.1B, current CN¥103.6BUnfavorable
- EPS (diluted)−17.9%Prior CN¥6.70, current CN¥5.50Unfavorable
▲ and ▼ show the direction of each change. Color and “Read as” show whether that direction is usually favorable for the metric.
Earnings Quality & Cash Conversion
Income from operations of RMB50,150 million includes impairment of goodwill of RMB9,515 million (US$1,380 million) and amortization and impairment of intangible assets of RMB5,079 million (US$736 million). Net income of RMB102,127 million includes interest and investment income, net of RMB87,512 million (US$12,687 million), which the filing attributes primarily to the year-over-year increase in net gain from mark-to-market changes of equity investments as well as net gains from disposal of investments, including local consumer service business of Trendyol in fiscal year 2026, compared to losses on disposal of Sun Art and Intime in fiscal year 2025. The filing defines non-GAAP net income of RMB60,658 million as net income before non-cash share-based compensation expense, amortization and impairment of intangible assets, gain or loss on deemed disposals/disposals/revaluation of investments, impairment of goodwill and investments, and others, and adjustments for the tax effects.
Red flag
Red flag
Red flag
Value Drivers & Capital Allocation
“Net cash used in financing activities in fiscal year 2026 was RMB20,573 million (US$2,983 million) primarily reflected dividend payment of RMB33,732 million (US$4,890 million) and acquisition of additional equity interests in non-wholly owned subsidiaries of RMB16,768 million (US$2,431 million), partly offset by the net proceeds from issuance of convertible unsecured senior notes and the payments for capped call transactions of RMB20,967 million (US$3,040 million) and the net proceeds from issuance of exchangeable bonds of RMB10,986 million (US$1,593 million).”
Filing statement
“In May 2024, we issued convertible unsecured senior notes for an aggregate principal amount of US$5.0 billion due on June 1, 2031. The convertible unsecured senior notes are senior unsecured obligations, and interest at an annual rate of 0.5% is payable in arrears semiannually. We have used the proceeds from the issuance of the convertible unsecured senior notes to fund share repurchases and fund the cost of entering into capped call transactions.”
Filing statement
“In July 2025, we issued zero coupon exchangeable bonds due 2032 by reference to the ordinary shares of our subsidiary, Alibaba Health Information Technology Limited, that are listed on the Hong Kong Stock Exchange, for an aggregate principal amount of approximately HK$12 billion. We intend to use the net proceeds from the offering of the exchangeable bonds for general corporate purposes, including investments to support the development of our cloud infrastructure and international commerce businesses.”
Filing statement
“In September 2025, we issued zero coupon convertible unsecured senior notes due 2032 for an aggregate principal amount of approximately US$3.2 billion. We intend to use the net proceeds from the offering of the convertible unsecured senior notes for general corporate purposes, with a strategic focus on strengthening its cloud infrastructure capabilities and international commerce business operations.”
Filing statement
Return on equity was 9.8% (prior 12.9%) (period net income / period-end equity, not annualized); return on assets 5.4% (prior 7.2%) (period net income / period-end assets, not annualized).
Forward Signals
No numeric financial guidance is provided. The filing states: "We have been and will continue investing at scale in cloud computing and AI capabilities as well as consumption, including quick commerce."
Known trends
- The filing states it has been and will continue investing at scale in cloud computing and AI capabilities as well as consumption, including quick commerce.
- The filing states that its investment in new and existing businesses has and may lower its margins but it believes the investment will deliver overall long-term growth.
- The filing states it expects to fund additional investments through cash generated from its operations and through debt and equity financing when opportunities arise in the future.
Subsequent events
- Not disclosed—no material events after the March 31, 2026 fiscal year-end are described in the provided excerpts.
“We have been and will continue investing at scale in cloud computing and AI capabilities as well as consumption, including quick commerce.”
Alibaba Group Holding Limited
“Our investment in the above-mentioned new and existing businesses has and may lower our margins but we believe the investment will deliver overall long-term growth.”
Alibaba Group Holding Limited
Risks
Excerpts are the filing’s own words; each heading is the start of its excerpt. Selected excerpts are not a complete risk inventory.
Investors in our ADSs and Shares are purchasing equity securities of a Cayman Islands holding…
Investors in our ADSs and Shares are purchasing equity securities of a Cayman Islands holding company rather than equity securities issued by our consolidated subsidiaries and the VIEs, and investors may never hold equity interests in the VIEs under current PRC laws and regulations.
if the PRC government deems that the contractual arrangements in relation to the VIEs do not comply…
if the PRC government deems that the contractual arrangements in relation to the VIEs do not comply with PRC regulations on foreign investment, or if these regulations or the interpretation of existing regulations change in the future, we could be subject to penalties, or be forced to relinquish our interests in the operation of the VIEs, and we would no longer be able to consolidate the financial results of the VIEs in our consolidated financial statements.
Such new regulatory requirements could significantly limit or completely hinder our ability…
Such new regulatory requirements could significantly limit or completely hinder our ability and the ability of our subsidiaries to obtain external financing through the issuance of equity securities overseas and cause the value of our securities, including our ADSs and Shares, to significantly decline or become worthless.
Sustained investment in our businesses and our focus on long-term performance and maintaining…
Sustained investment in our businesses and our focus on long-term performance and maintaining the health of our ecosystem may negatively affect our margins and our net income
We have incurred impairment charges in the past and may incur impairment charges in the future
We have incurred impairment charges in the past and may incur impairment charges in the future.
5 of 5 excerpts located in the filing text
Balance Sheet & Liquidity
Leverage: This filing's standardized financial data reports no debt balance under a concept whose scope can be verified. That is an unestablished scope, not zero debt and not a net cash position; no total debt, net debt or debt-to-equity figure is stated.
Liquidity: As of March 31, 2026, cash and cash equivalents were RMB131,530 million (US$19,068 million), with short-term investments and other treasury investments that are unrestricted for withdrawal and use of RMB155,236 million (US$22,505 million) and RMB234,058 million (US$33,931 million) respectively, totaling RMB520,824 million (US$75,504 million). The filing states it believes current levels of cash and cash flows from operations will be sufficient to meet anticipated cash needs for at least the next twelve months.
Cash flow: Cash flow — operating CNY 76.2B.
Working capital: The filing does not present a classified balance sheet with a current-asset/current-liability split in the provided excerpts, so no working capital or current ratio is reported.
Maturities & covenants
- In December 2025, we repaid the outstanding balance of US$3.17 billion under the revolving credit facility; as of March 31, 2026, total outstanding borrowing was RMB3.9 billion (US$0.6 billion) under the ancillary facility arrangement by way of short-term loan facilities with unutilised commitment of approximately US$2.6 billion.
- The US$3.33 billion revolving credit facility has not been drawn as of March 31, 2026, with an expiration date extended to September 30, 2028 and an option to further extend to September 30, 2030.
- Total capital commitments contracted but not provided for amounted to RMB45,321 million and RMB54,136 million (US$7,848 million) as of March 31, 2025 and 2026, respectively.
Notable Footnotes
| Item | Impact |
|---|---|
| Segment reporting reclassification | During fiscal year 2026 the company combined Taobao and Tmall Group, Ele.me and Fliggy into Alibaba China E-commerce Group and reclassified Cainiao, Amap and Hujing Digital Media and Entertainment Group into "All others"; comparative segment figures for fiscal years 2024 and 2025 were reclassified to conform with the new reporting structure. |
| PRC withholding tax on distributable earnings | As of March 31, 2026, the company accrued withholding tax on substantially all earnings distributable by its subsidiaries in China, except for RMB278.9 billion (US$40.4 billion) reserved for permanent reinvestment in China. |
| Restricted net assets of PRC operating subsidiaries | Applicable PRC law permits dividends to be paid only out of retained earnings, and PRC operating subsidiaries must set aside reserves until reaching 50% of registered capital; restricted net assets totaled RMB344.6 billion (US$50.0 billion) as of March 31, 2026. |
| Share-based compensation expense | Share-based compensation expense was RMB14,821 million (US$2,149 million) in fiscal year 2026, representing 1% of revenue, down from RMB15,577 million in fiscal year 2025; the filing attributes the decrease primarily to a decrease in the number of awards granted as the company increased the proportion of long-term cash incentives. |
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