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Chinese tech giant Alibaba reported a quarterly revenue bump on Tuesday, after shares rose on the blockbuster launch of a new artificial intelligence app downloaded more than 10mn times in a week.Analysts said the early success of the company's redesigned Qwen app positions it as a potential competitor to Chinese rival DeepSeek and OpenAI's ChatGPT.Alibaba said on Tuesday revenue in the three months ending September 30 totalled 247.8bn yuan ($35bn).That was a 5% jump on the 236.5bn yuan logged in the same quarter last year and beat analyst estimates of 245.2bn yuan."We have entered into an investment phase to build long-term strategic value in AI technologies and infrastructure," said Eddie Wu, Alibaba's chief executive officer."Robust AI demand further accelerated our Cloud Intelligence Group business, with revenue up 34 % and AI-related product revenue achieving triple-digit year-over-year growth for the ninth consecutive quarter," Wu said.Net income attributable to ordinary shareholders for the quarter fell to 21bn yuan, down 52% on-year, the company said.Alibaba runs some of China's biggest online shopping platforms and wants to become a major player in the global race to develop AI technology.The Hangzhou-based company said in February it would spend at least 380bn yuan ($53bn) on artificial intelligence and cloud computing over the next three years.Wu said in September the company plans to increase that spending further.This approach has seen Alibaba's share price on Wall Street surge around 90% from this time a year ago — despite fears that AI-related stocks are overvalued worldwide and could crash.Its US shares closed 5% higher on Monday after the company said the Qwen app had surpassed 10mn downloads within the first week of its beta launch.Crystal Li and Tommy Wong of China Merchants Securities said last week that Qwen's launch was "supported by Alibaba's prolonged investment and cutting-edge capabilities in foundational models" for artificial intelligence.It could pave the way for the adoption of AI agents — programmes that use chatbots to do the work humans do online, such as buying a plane ticket or adding events to a calendar."Compared to ChatGPT's direct access to third-party apps, we believe Alibaba's self-developed comprehensive product ecosystem and free-to-use policy provide competitive advantages for Qwen app," Li and Wong wrote.Emily Jarvie of Proactive Investors also noted ahead of Tuesday's earnings release that "China is a key market for Qwen, as OpenAI's ChatGPT is not available"."Its rapid adoption makes it one of the fastest-growing AI apps in China," Jarvie said.Alibaba has also been in the headlines recently for other reasons, namely geopolitical tensions between China and the US.

Meituan’s shares dropped the most since April after warning of losses this quarter from a price-based battle with Alibaba Group Holding Ltd and JD.com Inc, wiping out a combined $27bn in market value from the three Internet commerce leaders.China’s food delivery leader issued its dire prediction after reporting “irrational competition” eradicated most of its profit in the June quarter. That spooked investors already nervous about deepening losses in the online arena, prompting a series of downgrades on Meituan. Shares in Alibaba and JD both slid about 5%, while Meituan was down 13% at one point. The Hang Seng Tech Index led losses in Asia on Thursday, slumping as much as 2.3%.The plunge in profitability illustrates how Meituan is facing its greatest challenge in years from twin rivals that — till recently — had largely ceded the domestic meal sector. That changed in 2025 when JD.com, pursuing growth during a consumption downturn, and Alibaba’s Ele.me began offering generous subsidies to cash-strapped diners.The Beijing-based company now expects “significant losses” for its core local commerce business including food delivery in the current quarter, Chief Financial Officer Chen Shaohui told analysts on a post-earnings call on Wednesday.“We expect there will be continued fierce competition in the near term,” Chen said. “That will bring negative impact on our financial results.”The three-way battle in the food arena eroded profitability across the sector and forced Meituan to defend its core business on multiple fronts. This month, JD.com reported a halving in net income for the quarter. Alibaba has posted muted growth and is set to report earnings on Friday.In past months, the trio has invested billions of dollars in incentives and in hiring delivery riders. This strategy backfired with investors, who sold off shares in Meituan and JD.com, erasing roughly $100bn of their combined market value at one point.Following a warning from industry regulators, the three corporations in August pledged to cease their “disorderly competition” and avoid a self-destructive price war.Faced with margin pressure at home, Meituan is looking overseas. Its own aggressive pricing strategy forced Deliveroo Plc to retreat from Hong Kong after a decade of operating in the city.