Gross margins have contracted significantly from a peak of 44.9% in 2026Q1 to 34.5% in 2026Q4, reflecting persistent pressure from the company's shift toward direct-sales and logistics-heavy operations.
| Metric | Mar'26 | Mar'25 | Mar'24 | Mar'23 | Mar'22 | Mar'21 | Mar'20 | Mar'19 | Mar'18 | Mar'17 | Mar'16 | Mar'15 | Mar'14 | Mar'13 | Mar'12 | Dec'10 | Dec'09 | Dec'08 | Dec'07 | Dec'06 |
|---|
| Sales/Revenue | 1.02T | 996.35B | 941.17B | 868.69B | 853.06B | 717.29B | 509.71B | 376.84B | 250.27B | 158.27B | 101.14B | 76.2B | 52.5B | 34.52B | 20.02B | 5.56B | 3.87B | 3B | 2.16B | 1.36B |
| Revenue Growth % | 2.74% | 5.86% | 8.34% | 1.83% | 18.93% | 40.72% | 35.26% | 50.58% | 58.12% | 56.48% | 32.73% | 45.14% | 52.11% | 72.37% | 260.32% | 43.43% | 28.98% | 38.9% | 58.58% | - |
| Cost of Goods Sold | 616.14B | 598.28B | 586.32B | 549.7B | 539.45B | 421.2B | 282.37B | 206.93B | 107.04B | 59.48B | 34.35B | 23.83B | 13.37B | 9.72B | 6.55B | 931.02M | 534.44M | 400.65M | 280.11M | 237.63M |
| COGS % of Revenue | 60.19% | 60.05% | 62.3% | 63.28% | 63.24% | 58.72% | 55.4% | 54.91% | 42.77% | 37.58% | 33.97% | 31.28% | 25.46% | 28.16% | 32.73% | 16.75% | 13.79% | 13.34% | 12.95% | 17.42% |
| Gross Profit | 407.53B | 398.06B | 354.85B | 318.99B | 313.61B | 296.08B | 227.34B | 169.91B | 143.22B | 98.79B | 66.79B | 52.37B | 39.13B | 24.8B | 13.47B | 4.63B | 3.34B | 2.6B | 1.88B | 1.13B |
| Gross Margin % | 39.81% | 39.95% | 37.7% | 36.72% | 36.76% | 41.28% | 44.6% | 45.09% | 57.23% | 62.42% | 66.03% | 68.72% | 74.54% | 71.84% | 67.27% | 83.25% | 86.21% | 86.66% | 87.05% | 82.58% |
| Gross Profit Growth % | 2.38% | 12.18% | 11.24% | 1.72% | 5.92% | 30.24% | 33.8% | 18.64% | 44.98% | 47.92% | 27.53% | 33.82% | 57.82% | 84.08% | 191.17% | 38.51% | 28.3% | 38.29% | 67.16% | - |
| Operating Expenses | 347.87B | 257.16B | 241.5B | 218.64B | 243.97B | 206.41B | 135.91B | 112.83B | 73.91B | 50.73B | 37.69B | 29.23B | 14.21B | 14.05B | 8.46B | 3.09B | 2.27B | 1.46B | 1.08B | 857.74M |
| OpEx % of Revenue | 33.98% | 25.81% | 25.66% | 25.17% | 28.6% | 28.78% | 26.66% | 29.94% | 29.53% | 32.06% | 37.26% | 38.36% | 27.07% | 40.7% | 42.23% | 55.6% | 58.52% | 48.66% | 49.86% | 62.89% |
| Selling, General & Admin | 278.11B | 188.26B | 157.13B | 145.68B | 151.72B | 136.74B | 78.87B | 64.67B | 43.54B | 28.55B | 20.51B | 16.31B | 8.76B | 6.5B | 5.27B | 2.62B | 2.03B | 1.43B | 966.68M | 770.17M |
| SG&A % of Revenue | 27.17% | 18.89% | 16.69% | 16.77% | 17.79% | 19.06% | 15.47% | 17.16% | 17.4% | 18.04% | 20.28% | 21.41% | 16.69% | 18.84% | 26.31% | 47.12% | 52.48% | 47.61% | 44.7% | 56.47% |
| Research & Development | 66.53B | 57.15B | 52.26B | 56.74B | 55.47B | 57.24B | 43.08B | 37.44B | 22.75B | 17.06B | 13.79B | 10.66B | 5.09B | 3.75B | 2.9B | 580.17M | 384.33M | 214.04M | 131.5M | 105.49M |
| R&D % of Revenue | 6.5% | 5.74% | 5.55% | 6.53% | 6.5% | 7.98% | 8.45% | 9.93% | 9.09% | 10.78% | 13.63% | 13.99% | 9.7% | 10.87% | 14.47% | 10.44% | 9.92% | 7.12% | 6.08% | 7.73% |
| Other Operating Expenses | 3.23B | 11.75B | 32.11B | 16.22B | 36.79B | 12.43B | 13.96B | 10.73B | 7.61B | 5.12B | 3.39B | 2.26B | 359M | 3.79B | 290M | -109.03M | -150.57M | -182.64M | -19.88M | -17.91M |
| Operating Income | 59.66B | 140.91B | 113.35B | 100.35B | 69.64B | 89.68B | 91.43B | 57.08B | 69.31B | 48.05B | 29.1B | 23.14B | 24.92B | 14.41B | 5.01B | 1.54B | 1.07B | 1.14B | 804.35M | 268.5M |
| Operating Margin % | 5.83% | 14.14% | 12.04% | 11.55% | 8.16% | 12.5% | 17.94% | 15.15% | 27.7% | 30.36% | 28.77% | 30.36% | 47.46% | 41.76% | 25.04% | 27.65% | 27.69% | 38% | 37.19% | 19.69% |
| Operating Income Growth % | -57.66% | 24.31% | 12.95% | 44.1% | -22.35% | -1.92% | 60.17% | -17.64% | 44.24% | 65.13% | 25.79% | -7.16% | 72.9% | 187.4% | 226.38% | 43.2% | -6.02% | 41.94% | 199.57% | - |
| EBITDA | 106.78B | 175.87B | 157.85B | 147.29B | 117.7B | 137.59B | 133.86B | 94.16B | 91.33B | 62.35B | 36.15B | 27.63B | 26.57B | 15.35B | 5.88B | 1.76B | 1.2B | 1.23B | 863.61M | 322.54M |
| EBITDA Margin % | 10.43% | 17.65% | 16.77% | 16.96% | 13.8% | 19.18% | 26.26% | 24.99% | 36.49% | 39.39% | 35.74% | 36.26% | 50.61% | 44.46% | 29.39% | 31.72% | 30.96% | 40.95% | 39.93% | 23.65% |
| EBITDA Growth % | -39.28% | 11.41% | 7.17% | 25.14% | -14.45% | 2.79% | 42.15% | 3.1% | 46.49% | 72.47% | 30.82% | 3.99% | 73.14% | 160.8% | 233.83% | 46.96% | -2.49% | 42.45% | 167.75% | - |
| D&A (Non-Cash Add-back) | 47.12B | 34.96B | 44.5B | 46.94B | 48.06B | 47.91B | 42.43B | 37.08B | 22.02B | 14.29B | 7.05B | 4.5B | 1.65B | 935M | 870M | 226.32M | 126.58M | 88.47M | 59.26M | 54.04M |
| EBIT | 139.18B | 147.71B | 119.51B | 106.17B | 80.16B | 170.05B | 171.82B | 101.41B | 103.97B | 62.7B | 83.41B | 35.08B | 29B | 11.68B | 5.6B | 1.43B | 1.07B | 1.14B | 804.35M | 268.5M |
| Net Interest Income | 77.72B | 11.16B | -17.91B | -16.99B | -20.61B | -20.61B | 67.78B | 38.92B | 26.93B | 5.89B | 50.31B | 6.71B | -547M | -1.53B | 190M | 158.29M | 140.94M | 239.21M | 406.31M | 23.16M |
| Interest Income | 87.51B | 20.76B | 0 | 0 | 0 | 0 | 72.96B | 44.11B | 30.5B | 8.56B | 52.25B | 9.46B | 1.65B | 39M | 258M | 158.29M | 140.94M | 245.06M | 406.31M | 23.16M |
| Interest Expense | 9.79B | 9.6B | 17.91B | 16.99B | 20.61B | 20.61B | 5.18B | 5.19B | 3.57B | 2.67B | 1.95B | 2.75B | 2.19B | 1.57B | 68M | 0 | 0 | 0 | 0 | 0 |
| Other Income/Expense | 72.51B | 20.52B | -19.49B | -19.23B | 4.26B | 82.88B | 69.48B | 39.7B | 10.3B | 6.95B | 50.64B | 7.6B | 1.68B | -4.31B | 517M | 169.92M | 103.45M | 223.12M | 345.1M | 22.89M |
| Pretax Income | 132.17B | 161.42B | 93.86B | 81.12B | 73.89B | 172.56B | 160.91B | 96.79B | 79.61B | 55B | 79.74B | 30.74B | 26.6B | 10.11B | 5.53B | 1.71B | 1.18B | 1.36B | 1.15B | 291.39M |
| Pretax Margin % | 12.91% | 16.2% | 9.97% | 9.34% | 8.66% | 24.06% | 31.57% | 25.68% | 31.81% | 34.75% | 78.84% | 40.33% | 50.66% | 29.28% | 27.63% | 30.7% | 30.36% | 45.43% | 53.15% | 21.36% |
| Income Tax | 30.05B | 35.45B | 22.53B | 15.55B | 26.82B | 29.28B | 20.56B | 16.55B | 18.2B | 13.78B | 8.45B | 6.42B | 3.2B | 1.46B | 842M | 236.44M | 163.39M | 210.32M | 181.65M | 71.45M |
| Effective Tax Rate % | 22.73% | 21.96% | 24% | 19.17% | 36.29% | 16.97% | 12.78% | 17.1% | 22.86% | 25.05% | 10.6% | 20.87% | 12.02% | 14.42% | 15.22% | 13.86% | 13.89% | 15.41% | 15.8% | 24.52% |
| Net Income | 103.59B | 130.11B | 80.01B | 72.78B | 62.25B | 150.58B | 149.43B | 87.89B | 64.09B | 43.67B | 71.46B | 24.26B | 23.32B | 8.53B | 4.23B | 1.47B | 1.01B | 1.15B | 967.79M | 219.94M |
| Net Margin % | 10.12% | 13.06% | 8.5% | 8.38% | 7.3% | 20.99% | 29.32% | 23.32% | 25.61% | 27.59% | 70.65% | 31.84% | 44.41% | 24.72% | 21.11% | 26.44% | 26.14% | 38.43% | 44.75% | 16.13% |
| Net Income Growth % | -20.38% | 62.62% | 9.93% | 16.92% | -58.66% | 0.77% | 70.03% | 37.12% | 46.75% | -38.88% | 194.55% | 4.06% | 173.27% | 101.8% | 187.72% | 45.06% | -12.25% | 19.29% | 340.03% | - |
| Net Income (Continuing) | 102.13B | 125.98B | 71.33B | 65.57B | 47.08B | 143.28B | 140.35B | 80.23B | 61.41B | 41.23B | 71.29B | 24.32B | 23.4B | 8.65B | 4.67B | 1.47B | 1.01B | 1.15B | 967.79M | 219.94M |
| Discontinued Operations | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Minority Interest | 65.14B | 80.37B | 126.1B | 133.31B | 133.91B | 146.36B | 124.17B | 123.2B | 73.53B | 42.29B | 32.56B | 11.94B | 1.08B | 536.8M | 2.89B | 49.82M | 41.06M | 0 | 0 | 0 |
| EPS (Diluted) | 44.00 | 53.60 | 31.36 | 27.44 | 22.72 | 54.72 | 62.72 | 33.52 | 24.56 | 19.60 | 34.00 | 9.68 | 10.00 | 28.56 | 1.84 | 0.64 | 0.32 | 0.48 | 0.32 | 0.08 |
| EPS Growth % | -17.91% | 70.92% | 14.29% | 20.77% | -58.48% | -12.76% | 87.11% | 36.48% | 25.31% | -42.35% | 251.24% | -3.2% | -64.99% | 1452.17% | 187.5% | 100% | -33.33% | 50% | 300% | - |
| EPS (Basic) | 45.60 | 55.12 | 31.60 | 27.68 | 22.96 | 55.60 | 63.76 | 34.08 | 25.12 | 20.24 | 35.44 | 9.68 | 10.00 | 28.56 | 1.84 | 0.64 | 0.32 | 0.48 | 0.32 | 0.08 |
| Diluted Shares Outstanding | 2.4B | 2.41B | 2.54B | 2.64B | 2.72B | 2.75B | 2.67B | 2.62B | 2.61B | 2.57B | 2.56B | 2.5B | 2.47B | 2.32B | 2.32B | 2.54B | 2.54B | 2.53B | 2.43B | 2.38B |
| Basic Shares Outstanding | 2.32B | 2.35B | 2.52B | 2.62B | 2.69B | 2.7B | 2.63B | 2.58B | 2.55B | 2.49B | 2.46B | 2.34B | 2.47B | 2.32B | 2.32B | 2.52B | 2.52B | 2.53B | 2.43B | 2.38B |
| Dividend Payout Ratio | 32.56% | 22.53% | 22.6% | - | - | - | - | - | - | - | - | - | - | - | - | - | 87.68% | - | 20.24% | 89.39% |
Intense domestic competitive pressure
As reported in recent financial filings, Alibaba's revenue growth has decelerated to 2.9% in 2026Q4, reflecting a significant departure from the mid-single-digit expansion observed in previous periods and highlighting the challenges of maintaining scale in an increasingly saturated and competitive Chinese e-commerce landscape.
The consistent decline in year-over-year revenue growth suggests that the company's core marketplace is struggling to capture incremental wallet share against aggressive social commerce entrants. Investors should monitor whether this trend indicates a permanent shift in consumer behavior or merely a temporary lull in domestic consumption patterns.
Based on the provided income statement data, gross margins have contracted from a peak of 44.9% in 2026Q1 to 34.5% by 2026Q4, signaling that the company's pivot toward more capital-intensive logistics and direct-sales models is exerting persistent downward pressure on overall profitability.
This margin erosion appears to be a direct consequence of the company's strategic shift toward first-party retail and fulfillment services, which carry inherently lower margins than the legacy advertising-driven marketplace model. The inability to sustain gross margins above 40% suggests that competitive pricing pressures are forcing the firm to sacrifice profitability to defend its market position.
According to the latest quarterly results, operating income swung to a loss of $848 million in 2026Q4, a stark reversal from the $35 billion profit recorded in 2026Q1, indicating that the company is currently failing to achieve meaningful operating leverage despite its massive scale.
The erratic nature of operating margins suggests that SG&A expenses are not scaling efficiently with revenue, likely due to heavy reinvestment into AI and international expansion efforts. This lack of operational discipline warrants further investigation into whether these costs are strategic investments or a sign of bloated overhead in a slowing growth environment.
As evidenced by the dramatic fluctuations in net income, which ranged from $3.4 billion in 2024Q4 to $49.1 billion in 2025Q3, Alibaba's bottom line appears heavily influenced by non-operating items and equity investment valuations rather than core operational performance.
The significant variance in EPS suggests that investors should be cautious when relying on headline net income as a proxy for sustainable profitability. The reliance on equity pick-ups and potential mark-to-market gains creates a layer of opacity that makes it difficult to assess the true underlying earnings power of the business.
Based on the reported figures, the sharp decline in operating margins and the deceleration of revenue growth provide a compelling case for short-sellers who argue that Alibaba's traditional search-based advertising model is being structurally undermined by the rise of live-streaming and social commerce platforms.
The persistent threat from competitors like PDD Holdings suggests that Alibaba's historical pricing power is waning, forcing the company into a defensive posture that may permanently impair its return on invested capital. Investors should consider the risk that the company's massive cash reserves are being used to mask a fundamental deterioration in its core competitive advantage.
Quick answers to the most common questions about buying BABA stock.
For fiscal year 2026, Alibaba Group Holding Limited (BABA) reported total revenue of $1.02T. This represents a 74956.7% increase compared to $1.36B in 2007.
Alibaba Group Holding Limited (BABA) is profitable, generating $103.59B in net income for the fiscal year ending 2026 with a net profit margin of 10.1%.
Alibaba Group Holding Limited (BABA) reported an operating income of $59.66B, resulting in an operating profit margin of 5.8%. This margin reflects the operational efficiency of the business before interest and taxes.
Alibaba Group Holding Limited (BABA) generated $407.53B in gross profit for the year, representing a gross profit margin of 39.8%. This demonstrates the company's core pricing power and production efficiency.