Alibaba’s AI Business Is Exploding, So Why Did Profits Suddenly Collapse?

Cloud growth is surging, AI demand is booming… yet Alibaba’s collapsing margins are raising a major warning sign for investors. March 20, 2026

Research: Illustration

Date: March 20, 2026

Estimated reading time: 6 minutes

Alibaba Group just delivered one of its strangest quarters in years.

Cloud growth exploded.

AI demand accelerated again.

And the company is rapidly transforming itself into a technology and infrastructure platform.

But at the same time:

profits collapsed.

Operating income plunged.

Margi…