Alibaba (NYSE:BABA) releases earnings on Thursday morning as investors rotate back to Chinese stocks.
BABA – Daily Chart
The price of BABA surged from lows near $81 in January to a current price of $124. The earnings will show if the $118 level is retested, or if the stock can power higher.
Alibaba will release earnings ahead of the US market open on Thursday morning. Investors have been shown to be rotating money out of India and back to China.
That move has been driven by excitement over the DeepSeek AI tool. Chinese stocks had been highly undervalued and a rally was set to happen as US stocks were being given high valuations due to AI expectations.
A Chinese stock renaissance can counterbalance investor concern about increased tariffs and help narrow that valuation gap with Silicon Valley peers, according to Bloomberg Intelligence.
Stock gains have been supported by Alibaba’s partnership with Apple to roll out AI features in China. Globally, DeepSeek’s high-efficiency and low-cost model could drive an inflection point for AI this year, Citi analysts noted. Baidu and Tencent are integrating DeepSeek into their platforms.
For the third quarter, the estimate for revenues is $38.19 billion, suggesting a 4.14% rise from the year-ago quarter. Earnings per share is expected to be $3.08 per share. The company’s International Digital Commerce Group was a bright spot last quarter with 29% year-over-year revenue growth.
