Alibaba’s Profit Dives 75% After Amping Up AI Spending

Alibaba Group Holding Ltd. reported a 75% drop in its fiscal fourth-quarter profit, a significant decline attributed to increased investments in artificial intelligence and cloud computing. The e-commerce giant's net income fell to 2.52 billion yuan ($350 million) for the three months ended March 31, down from 10.09 billion yuan a year earlier. Revenue saw a modest increase of 2% to 208.2 billion yuan, falling short of analyst expectations. The company has been heavily investing in AI development and infrastructure, aiming to compete with rivals in the rapidly evolving tech landscape. This strategic shift, while crucial for future growth, has impacted short-term profitability.