Michael Burry says Alibaba must fall another 50% as AI spending weighs after a 40% slide
AI Market Summary
Alibaba's June-quarter results highlight AI capex pressure: revenue rose 9% but net income fell 75%, capex jumped 75% (GPU-driven), and free cash flow outflow widened materially. The company plans a $10.2B share placement at an 8.4% discount (~3.7% dilution) while buybacks have sharply slowed, signaling funding stress. The mix of dilution and weaker cash generation is likely to weigh on near-term equity sentiment.
Impact level
● Medium
Affected assets
NCSKBABA2USD/USDT+0.56%
AI Insight · NCSKBABA2USD/USDTAI Insight
▼ Bearish
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Alibaba’s June-quarter revenue rose 9% year on year to about 269 billion yuan, while net income fell 75% to 10.5 billion yuan. Capital spending jumped 75% to 67.68 billion yuan, largely tied to GPU purchases, and free cash flow widened to a 44.7 billion yuan outflow from a 18.8 billion yuan outflow a year earlier. The company plans to sell $10.2 billion of stock to fund AI investment, while buybacks shrank 92% year on year to $956 million.
