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Beijing-based investment bank China Renaissance is shifting its focus back toward the US this year, now that founder Bao Fan has been released from state detention.
The Chinese financial institution, which has roughly RMB 32 billion (USD 4.6 billion) in assets under management, hired a new head of capital markets in the US and is increasing its resources to help Chinese companies that are increasingly looking to diversify beyond the domestic market.
A younger generation of Chinese entrepreneurs, inspired by their global upbringing and education in Western countries, is setting its sights overseas as weak consumption and property woes continue to dog China's economy.
"We have the resources as a company overall to cater to them and service them," Enna Weng, China Renaissance's new head of capital markets in the US, told Nikkei Asia in an interview. "We know how to cater to the second generation, how to grow alongside [them] with our US expertise."
Weng pointed to <a href="/company/pop-mart">Pop Mart</a>, the company behind the once globally viral Labubu dolls, and <a title="" href="/company/luckin-coffee" target="_blank" rel="noopener">Luckin Coffee</a>'s recent entrance into the US market as examples of corporate China's international footprint.
Companies from the world's second largest economy in recent years have accelerated the "chuhai" trend, which means to go overseas, as their home market shrinks, segueing from exporters to global brand builders. Some, like electric vehicle maker <a href="/company/byd">BYD</a> and battery producer <a href="/company/catl">Contemporary Amperex Technology</a> (CATL), have also moved manufacturing bases outside China to "geopolitically neutral" countries over heightened diplomatic tensions.
Weng, who has also worked at Freedom Capital Markets and Barclays, said these companies have a lot of potential to grow and are also interested in listing in the US through reverse mergers or special purpose acquisition companies.
"We're going to see a lot of that, I think, in the near term," she said.
China Renaissance is hiring at least seven new North America staff in banking and sales this year after scaling back its operations in 2023, when star dealmaker Bao, who founded the bank in 2005 with two other men, was <a title="" href="https://asia.nikkei.com/business/finance/missing-china-tech-banker-bao-fan-aiding-investigation-company-says" target="_blank" rel="noopener">unable to be contacted</a>. His disappearance rattled China's financial sector before he reemerged last August as the Chinese government began exploring ways to boost confidence among private businesses.
A decade ago, when record numbers of Chinese companies were listing in the US, the boutique investment bank was involved in underwriting some of the larger ones, including those of <a href="/industry/e-commerce">e-commerce</a> giants <a href="/company/jd">JD.com</a> and <a href="/company/tencent">Tencent</a>. It also oversaw major Chinese tech mergers, including those of delivery giants <a href="/company/meituan">Meituan</a> and Dianping, and ride-hailing services <a href="/company/didi">Didi</a> and Kuaidi.
The number of blockbuster listings in the US declined after the Chinese government launched an investigation into Didi days after the taxi-hailing company listed on the New York Stock Exchange in the summer of 2021, with the help of China Renaissance. Intense government pressure forced Didi to delist less than a year later.
Companies looking to list outside of mainland China must obtain approval from Chinese regulators. In the past year, such approvals have slowed to a trickle.
Geopolitical tensions have also made it difficult to seek US funding. In addition, US regulators <a href="https://asia.nikkei.com/politics/international-relations/us-china-tensions/nasdaq-proposes-tighter-rules-targeting-chinese-small-cap-listings" target="_blank" rel="noopener">tightened restrictions</a> after small-cap listings by Chinese companies were found to be involved in pump-and-dump schemes.
While acknowledging the challenges, Weng remains confident that more globalized companies can overcome these hurdles. Her investment bank is looking at listings valued at USD 200 million to USD 3 billion, focusing on healthcare, consumer goods, and crypto and digital assets.
"We want to grow with the company early on," Weng said, "so we can help them eliminate or reduce risks to be a better global stage company."
China Renaissance is also looking to help take Asian <a href="/industry/biotech">biotechnology</a> patents to North America via licensing deals that let established pharmaceutical companies develop and commercialize intellectual property from smaller Asian players.
In China, biotech licensing surged to a record high last year, when 186 deals were signed, according to data provider Pharmcube.
"We would like to help companies to license out to the United States from Asia, not just China," Weng said. "We have had a presence in Singapore as well, so we want to go into other regions in Asia, in [South] Korea, in Japan, in Southeast Asia, and cater to entrepreneurs there" and help them navigate their way in the US and Canada.
This article first appeared on <a href="https://asia.nikkei.com/business/finance/china-renaissance-sets-sights-on-cross-border-deals-with-new-us-hire">Nikkei Asia</a>. It has been republished here as part of 36Kr’s ongoing partnership with <a href="https://www.0722vps.aieehr01.top/nikkei-teams-up-with-36kr-in-asia-tech-news-coverage/">Nikkei</a>.
Note: RMB figures are converted to USD at rates of RMB 6.90 = USD 1 based on estimates as of March 25, 2026, unless otherwise stated. USD conversions are presented for ease of reference and may not fully match prevailing exchange rates.

China Renaissance sets sights on cross-border deals with new US hire

Investment

China

Unitree Robotics has filed for an IPO on the Shanghai Stock Exchange, seeking to raise up to RMB 4.2 billion (USD 609 million).
According to the company’s prospectus, about half of the proceeds will be allocated to R&amp;D in <a href="/industry/robotics">robotics</a> and embodied intelligence. The remaining funds are set to support product development and manufacturing facilities following the IPO.
The review process is expected to begin soon, with Unitree aiming to list on the Star Market, which typically caters to technology and tech-focused companies.
The planned IPO follows strong sales growth. According to the prospectus, Unitree’s sales reached RMB 1.7 billion (USD 246.5 million) in 2025, about 4.3 times higher than the previous year, while net profit tripled to about RMB 287.6 million (USD 41.7 million). Notably, revenue from humanoid robots has risen sharply in recent years, alongside broad-based growth across its product categories, based on data disclosed in the filing:
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Even before reaching these financial milestones, Unitree had long been viewed as one of China’s leaders in robotics since its founding in 2016. That reputation stems not only from the company’s high-profile demonstrations and public showcases, but also from its founder, Wang Xingxing.
Wang has been vocal about the need for embodied intelligence to advance through both hardware and software, rather than placing too much emphasis on hardware alone. In previous conversations with 36Kr, he said Unitree has a sizable team focused on <a href="/industry/ai">artificial intelligence</a> model development, including models that power its robots. According to Wang, the company’s efforts extend beyond motion control, where it is already considered strong, into more advanced capabilities such as cognition and planning.
Among Unitree’s latest offerings is the <a href="https://0722vps.aieehr01.top/unitrees-new-h2-brings-streamlined-elegance-to-humanoid-robotics">H2</a>, a full-sized humanoid robot, though the G1 is likely more familiar to the public. The G1 has been used in public showcases, including a martial arts segment during <a href="https://0722vps.aieehr01.top/after-this-years-gala-spectacle-where-is-unitree-robotics-headed">this year’s Lunar New Year gala</a> in China, where 24 G1 robots were deployed to “spar” with human performers and execute movements such as table vaults and backflips. Unitree also participated in last year’s broadcast.
<div class="embed-container"><iframe src="https://www.youtube.com/embed/OyNOSM3Ka40?si=xZPX7WU4K5TvkV0D?autoplay=1&amp;mute=1&amp;origin=https://0722vps.aieehr01.top" frameborder="0" allowfullscreen> height="278" frameborder="0" allowfullscreen="allowfullscreen" data-ytbridge="vidSurrogate2"></iframe></div>
Beyond humanoid robots, Unitree also develops other robotic form factors, including quadruped machines such as the Go2 robot dog.
In terms of commercialization, Unitree is among the frontrunners, projecting shipments of 10,000–20,000 units in 2026. Its domestic competitors include UBTech Robotics, which develops the Walker line of humanoid robots, as well as broader technology players such as <a href="/company/xpeng">Xpeng</a>, which is developing the Iron humanoid robot. Globally, Unitree is often compared with <a href="/company/tesla">Tesla</a>, which is developing the Optimus robot.
Note: RMB figures are converted to USD at rates of RMB 6.90 = USD 1 based on estimates as of March 24, 2026, unless otherwise stated. USD conversions are presented for ease of reference and may not fully match prevailing exchange rates.

Unitree targets IPO after revenue quadruples on robotics demand

East Asia

Robotics

Deep Tech

Embodied Intelligence

<a href="/company/weride">WeRide</a>, the Nasdaq-listed autonomous driving company, reported its full-year 2025 results on March 23, posting record revenue of RMB 684.6 million (USD 99.3 million), up 89.6% year-on-year, as fourth-quarter revenue more than doubled to RMB 314 million (USD 45.5 million). Robotaxi revenue rose 209.6% to RMB 148 million (USD 21.5 million). The company said its global robotaxi fleet reached 1,125 vehicles and is expected to grow to 2,600 by the end of 2026, subject to regulatory approvals and market conditions.
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The more consequential signal in the results is WeRide's shift toward real-world deployment, particularly overseas. On the earnings call, management said international markets contributed about 29% of 2025 revenue, supported by expansion in the Middle East, Europe, and the Asia Pacific. In its release, the company highlighted Europe's first driverless robotaxi permit for passenger services in Switzerland, a fully driverless commercial permit in Abu Dhabi, and new launches in Dubai, Riyadh, Singapore, and Slovakia.
The results also signal how far the business remains from translating scale into earnings. Full-year gross profit rose to RMB 206.8 million (USD 30 million), with gross margin broadly stable at 30.2%. However, WeRide reported an operating loss of RMB 1.85 billion (USD 268.3 million) and a net loss of RMB 1.65 billion (USD 239.3 million). Even after narrowing from 2024, those losses remained more than twice annual revenue.
The fourth quarter reflected similar dynamics. Revenue rose 123% to RMB 314 million (USD 45.5 million), driven by a 308.9% increase in product revenue to RMB 211.4 million (USD 30.7 million), mainly from robotaxi and robobus sales. Service revenue grew 15.2% to RMB 102.6 million (USD 14.9 million). Gross margin declined to 28.5% from 36.5% a year earlier, which the company attributed primarily to a lower contribution from higher-margin R&amp;D services related to advanced driver assistance systems (ADAS).
That revenue mix is significant. While robotaxis anchor WeRide's long-term narrative, its current revenue base remains diversified. On the earnings call, management said robotaxi contributed 22% of 2025 revenue, robobus 34%, and ADAS and data services 29%. This indicates WeRide is scaling as a diversified business before demonstrating it can generate returns as a mature robotaxi operator.
The progress, however, is incremental rather than definitive. One of the more important signals in the release was cost. WeRide said total cost of ownership in China fell 38% in 2025, supported by lower bill-of-materials costs and improved operating efficiency. The remotely assisted human-to-vehicle ratio improved fourfold, while the latest GXR robotaxi reduced bill-of-materials costs by 15% and cut per-vehicle production time to under ten minutes.
These improvements help explain management's emphasis on scalability. On the call, the company said average daily orders per vehicle in China reached 15 trips over the past six months and 26 during peak periods, while its Middle East subsidiary was already profitable on a standalone basis. These disclosures indicate where WeRide sees a path to viable unit economics: denser fleets, lower operating costs, and overseas markets with more favorable pricing and regulatory conditions.
The balance sheet provides time to pursue that strategy. WeRide ended 2025 with RMB 7.13 billion (USD 1.03 billion) in total capital reserves, including RMB 6.97 billion (USD 1.01 billion) in cash, cash equivalents, and time deposits, and announced a USD 100 million share repurchase program.
Even so, the company is not close to breakeven. R&amp;D spending remained elevated at RMB 1.37 billion (USD 198.7 million) for the year, up from RMB 1.09 billion (USD 158.1 million) in 2024, driven by investment in data compliance capabilities, preinstalled robotaxis, and next-generation infrastructure. That level of spending may be necessary to build a global platform spanning Level 2 to Level 4 capabilities, but it also extends the timeline to profitability.
What WeRide's 2025 results show is not the emergence of robotaxis as a mature business, but the early assembly of one. The company is building the components: international permits, growing fleet density, lower unit costs, expanding product revenue, and a broader overseas footprint. In 2026, WeRide must show that its deployments can translate into repeatable, higher-margin ride revenue before the cost of building it rises again.
Note: RMB figures are converted to USD at rates of RMB 6.90 = USD 1 based on estimates as of March 24, 2026, unless otherwise stated. USD conversions are presented for ease of reference and may not fully match prevailing exchange rates.

WeRide revenue surges on robotaxi growth, but losses remain high

WeRide

Transportation

Autonomous Vehicles

Mobility

… high-risk keywords before installing them, including “curl,” “wget,” “base64,” and “bash -c.”
Some users have turned to another solution: installing skills designed to evaluate the safety of other skills. But A-Cong said even those evaluation tools can themselves be compromised. “The best option is to use an evaluation skill released by a legitimate company, or just build the skill yourself,” he said.
<h3>8. Stay curious, keep your distance, stay in control</h3>
Whenever new technology arrives, excitement and hype are inevitable. In conversations with 36Kr, OpenClaw users often described two forces at once: the desire to become more efficient, and the fear of being abandoned by the technological tide.
Against that backdrop, however, OpenClaw’s idle rate appears strikingly high. Social media has already filled with a new kind of service: for RMB 100–500 (USD 14.5–72.5), someone will uninstall OpenClaw for you. Right now, owning it seems to carry more social and emotional value than practical value.
So how should ordinary people approach OpenClaw? Should they embrace it unconditionally despite the risks, or stay cautious and watch from the sidelines? In Sun Linjun’s view, OpenClaw’s move into the mainstream is at least encouraging:
<blockquote>“It means the public has directly experienced what agents can do and felt the reality of technological progress. For users, it’s a very good form of technology education.”</blockquote>
That is why people should explore OpenClaw’s capabilities safely, and test the boundaries of what it can do. For some, that may be one of the fastest ways to participate in the current technology wave.
There is at least one positive sign: many users without technical backgrounds have already started finding practical uses for it. A programmer who offers in-home installation services told 36Kr that one of his clients, who works in foreign trade, now uses OpenClaw to identify key opinion leaders on social media and LinkedIn and compile business opportunities.
A-Li once asked her own OpenClaw how a technical novice should get along with it. Its answer was this:
<blockquote>“Stay curious, keep your distance, stay in control. When you feel things slipping out of your hands, uninstall me immediately.”</blockquote>
KrASIA features translated and adapted content that was originally published by 36Kr. This <a href="https://36kr.com/p/3720215408310663">article</a> was written by Wang Yuchan and Zhou Xinyu for 36Kr.
Note: RMB figures are converted to USD at rates of RMB 6.90 = USD 1 based on estimates as of March 24, 2026, unless otherwise stated. USD conversions are presented for ease of reference and may not fully match prevailing exchange rates.

What is OpenClaw? 8 things to know as the AI agent draws hype, confusion, and caution

Artificial Intelligence

… https://console.0722vps.aieehr01.top/wp-content/uploads/2026/03/Tars-AWE-2026-A1-720x480.jpg 720w, https://console.0722vps.aieehr01.top/wp-content/uploads/2026/03/Tars-AWE-2026-A1-1024x683.jpg 1024w, https://console.0722vps.aieehr01.top/wp-content/uploads/2026/03/Tars-AWE-2026-A1-768x512.jpg 768w, https://console.0722vps.aieehr01.top/wp-content/uploads/2026/03/Tars-AWE-2026-A1-1536x1024.jpg 1536w" sizes="(max-width: 480px) 100vw, 480px" /><figcaption id="caption-attachment-160732" class="wp-caption-text">The A1 humanoid robot developed by Tars. Photo source: Tars.</figcaption></figure>
Tars also demonstrated its general-purpose embodied intelligence model, AWE 3.0. At the booth, visitors could choose a scenario and assign a task, and a large screen would display a first-person simulation of how the robot would carry it out. Using inputs such as point clouds, tactile parameters, and motion trajectories, the system visualized the environment as the robot interprets it.
<h3>Fotile: A robotic kitchen prototype</h3>
Fotile built a <a href="/industry/robotics">robotics</a>-driven kitchen system for the show. It is structured as a closed loop of perception, decision-making, and execution:
<ul>
<li aria-level="1">According to the company, the perception layer uses infrared thermal imaging, high-precision vision, and weight sensors to monitor the temperature, weight, and doneness of ingredients in real time.</li>
<li aria-level="1">For decision-making, Fotile uses a self-developed large model trained on kitchen-specific data and a cooking knowledge graph to generate personalized diet plans.</li>
<li aria-level="1">For execution, different robots handle different tasks inside the kitchen. A humanoid robot performs motions such as pouring oil, adding salt, heating the wok, and stirfrying, while high-precision robotic arms handle more delicate tasks, including positioning cups, dispensing water, and organizing tableware.</li>
</ul>
<figure id="attachment_160733" aria-describedby="caption-attachment-160733" style="width: 480px" class="wp-caption aligncenter"><img loading="lazy" decoding="async" class="wp-image-160733" src="https://console.0722vps.aieehr01.top/wp-content/uploads/2026/03/Fotile-AWE-2026-Kitchen-Robots.jpg" alt="Photo shows the kitchen system set up by Fotile at AWE 2026, featuring humanoid robots designed to handle various tasks." width="480" height="320" srcset="https://console.0722vps.aieehr01.top/wp-content/uploads/2026/03/Fotile-AWE-2026-Kitchen-Robots.jpg 1080w, https://console.0722vps.aieehr01.top/wp-content/uploads/2026/03/Fotile-AWE-2026-Kitchen-Robots-720x480.jpg 720w, https://console.0722vps.aieehr01.top/wp-content/uploads/2026/03/Fotile-AWE-2026-Kitchen-Robots-1024x683.jpg 1024w, https://console.0722vps.aieehr01.top/wp-content/uploads/2026/03/Fotile-AWE-2026-Kitchen-Robots-768x512.jpg 768w" sizes="(max-width: 480px) 100vw, 480px" /><figcaption id="caption-attachment-160733" class="wp-caption-text">At AWE 2026, Fotile showcased a kitchen system featuring humanoid robots designed to handle various tasks. Photo source: 36Kr.</figcaption></figure>
At the show, the robotic kitchen demonstrated stirfrying, salting, plating, and serving dishes. The movements were slow, but 36Kr observed that the tasks were completed successfully.
For now, however, the robotic kitchen remains a prototype, with no mass production or commercialization plan.
KrASIA features translated and adapted content that was originally published by 36Kr. This <a href="https://36kr.com/p/3722882943334789">article</a> was written by Qiu Xiaofen for 36Kr.

Appliance makers place the future of home robots on display at AWE 2026

Consumer Economy

… Singapore-based biotechnology startup, raised USD 700,000 in a pre-seed funding round led by Wavemaker Impact.</li>
<li aria-level="1">PixVerse, a video generation platform developed by Chinese-founded AIsphere, raised an undisclosed amount of Series C funding in a round led by CDH Investments, with participation from Antler, EnvisionX Capital, iGlobe Partners, Lion X Ventures, UOB Venture Management, and 3W Fund.</li>
<li aria-level="1"><a href="https://www.aridge.com/">Aridge</a>, the flying car subsidiary of Xpeng, <a href="https://0722vps.aieehr01.top/xpeng-backed-aridge-raises-funding-to-advance-modular-flying-car-production">raised nearly USD 200 million in an equity round</a> from Gaorong Ventures, Fortune Capital, Hillhouse Capital, and HongShan, the latter two of which also participated in its earlier Series A round.</li>
</ul>
If there are any news or updates you'd like us to feature, get in touch with us at: <a href="mailto:hello@0722vps.aieehr01.top">hello@0722vps.aieehr01.top</a>.
Note: RMB figures are converted to USD at rates of RMB 6.91 = USD 1 based on estimates as of March 23, 2026, unless otherwise stated. USD conversions are presented for ease of reference and may not fully match prevailing exchange rates.

Deals in brief: QCraft raises Series D funding, Grab acquires Foodpanda’s Taiwan delivery business, seven China investments, and more

Grab

Foodpanda

Southeast Asia

Venture Capital

Private Equity

Merger &amp; Acquisition

Singapore

Malaysia

<a href="/company/xpeng">Xpeng</a> reported its latest earnings on March 20, posting its first quarterly net profit. The Chinese <a href="/industry/ev">electric vehicle</a> maker recorded RMB 383.21 million (USD 55.6 million) in net profit for the fourth quarter of 2025 on RMB 22.25 billion (USD 3.2 billion) in revenue. It guided first-quarter deliveries to 61,000–66,000 vehicles and revenue to RMB 12.20–13.28 billion (USD 1.8–1.9 billion), both down from a year earlier.
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What stood out in the reported quarter was the source of the earnings lift. Revenue from services and other solutions rose 121.9% year-on-year to RMB 3.18 billion, supported by technical R&amp;D services for a carmaker, parts and accessories sales, and carbon credit trading. That segment carried a 70.8% margin, well above Xpeng’s 13% vehicle margin, indicating that its technology and software stack may be starting to generate returns beyond vehicle sales.
That distinction matters because Xpeng’s car business, while improved, did not tell the full story. Gross margin rose to a record 21.3%, up from 14.4% a year earlier and 20.1% in the third quarter, but vehicle margin was essentially flat sequentially at 13%, compared with 13.1% in the prior quarter. The company’s first profit was therefore driven more by revenue mix than by a structural change in vehicle economics alone.
The quarter also benefited from non-core factors. Other income rose to RMB 839.7 million (USD 121.8 million), primarily due to higher government subsidies, while the company still posted a GAAP operating loss of RMB 44.3 million (USD 6.4 million). The profit milestone is therefore real, but not yet a fully clean operating result.
Xpeng’s management used the results to emphasize a broader identity beyond cars, anchored in <a href="/industry/ai">artificial intelligence</a>. In the release, CEO He Xiaopeng described the company as being at a “historical inflection point” for <a href="https://0722vps.aieehr01.top/xpengs-next-chapter-lies-in-physical-ai-says-ceo-he-xiaopeng">“physical AI”</a> applications, linking its next phase not only to AI-defined vehicles but also to deploying its second-generation vision-language-action (VLA) model in international markets and scaling production of advanced humanoid robots. Brian Gu, vice chairman and co-president, said the company had established a profitability path that “sets [it] apart from traditional automakers.”
whereRelatedArticle
That ambition is beginning to show in the financials, albeit in early form. Full-year services and other revenue rose 65.6% to RMB 8.34 billion (USD 1.2 billion), again driven by technical R&amp;D services, parts and accessories sales, and carbon credit trading. The segment remains smaller than vehicle revenue but is becoming large enough to influence group margins and support Xpeng’s argument that it is evolving beyond an automaker into a technology company.
On the earnings call, management highlighted three areas to support that case. The first was smart driving, where it positioned VLA 2.0 as a potential driver of showroom conversion and product mix. The second was overseas expansion, framed as a future profit center rather than simply an export channel. The third was <a href="/industry/robotics">robotics</a> and its robotaxi venture, both longer-term bets that help explain continued spending on AI and related technologies.
The balance sheet provides room to pursue that strategy. Xpeng ended 2025 with RMB 47.66 billion (USD 6.9 billion) in cash, while full-year R&amp;D spending rose 47% to RMB 9.49 billion (USD 1.4 billion), driven by investment in new vehicle models and technologies. That leaves the company better funded than many peers to support a strategy spanning vehicles, software, chips, and robotics.
The broader 2025 results suggest a company on firmer footing. Full-year deliveries rose 125.9% to 429,445 units, revenue increased 87.7% to RMB 76.72 billion (USD 11.1 billion), and gross margin improved to 18.9% from 14.3%. Net loss narrowed to RMB 1.14 billion (USD 165.3 million) from RMB 5.79 billion (USD 839.6 million).
What remains unresolved is how much of Xpeng’s broader platform strategy can translate into repeatable earnings in the near term. The quarter showed that its technology services can already support higher margins. It did not yet demonstrate that smart driving, overseas expansion, robotaxis, or robotics can do the same at scale. Until that changes, Xpeng’s earnings profile is likely to continue relying on its core vehicle business, even as management positions the company as something broader.
Note: RMB figures are converted to USD at rates of RMB 6.90 = USD 1 based on estimates as of March 24, 2026, unless otherwise stated. USD conversions are presented for ease of reference and may not fully match prevailing exchange rates.

Xpeng posts first profit as business shifts toward AI-driven services

Xpeng Motors

Electric Vehicles

<a href="/company/alibaba">Alibaba's</a> latest earnings showed why investors may be reluctant to assign it, or its <a href="/industry/ai">artificial intelligence</a> peers, a higher valuation. The Chinese tech giant said cloud revenue rose 36% in the December quarter, and AI-related product revenue posted triple-digit growth for a tenth straight quarter. Even so, its US-listed shares fell about 7.1% on March 19 to close at USD 124.9.
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The hesitation is understandable. Revenue rose 2% year-on-year (YoY) to RMB 284.8 billion (USD 41.3 billion), or 9% on a like-for-like basis excluding Sun Art and Intime, but that still missed the RMB 290.7 billion (USD 42.1 billion) consensus compiled by LSEG. Non-GAAP diluted earnings per ADS fell 67% YoY to RMB 7.09 (USD 1), well below the RMB 11.64 (USD 1.7) estimate.
The problem was not a lack of growth engines. It was the cost of funding them. Quick commerce revenue jumped 56% to RMB 20.8 billion (USD 3 billion), but customer management revenue in Alibaba's domestic e-commerce business rose just 1% to RMB 102.7 billion (USD 14.9 billion). Adjusted EBITA for the unit fell 43% to RMB 34.6 billion (USD 5 billion), while its operating margin narrowed to 4% from 15%. Sales and marketing expenses climbed to 25.3% of revenue from 15.2% a year earlier as Alibaba spent more on user incentives and promotions.
That spending also weakened cash generation. Operating cash flow dropped 49% to RMB 36 billion (USD 5.2 billion), while free cash flow fell 71% to RMB 11.3 billion (USD 1.6 billion). Alibaba said the decline was mainly due to investment in quick commerce. That is the clearest sign that it is still paying heavily to defend consumer traffic and shorten delivery times, even as softer transaction activity has limited the near-term return.
Cloud remains the clearest offset. Alibaba's cloud intelligence unit posted revenue of RMB 43.3 billion (USD 6.3 billion), while adjusted EBITA in the segment rose 25% to RMB 3.9 billion (USD 565.2 million). Revenue excluding Alibaba-consolidated subsidiaries grew 35%, and the company said AI-related product revenue extended its triple-digit growth streak to ten quarters. That suggests Alibaba's infrastructure and model stack are gaining traction, even if the group's overall earnings mix has yet to reflect it.
The divergence also helps explain why Alibaba used the quarter to sharpen its AI message. Management has set a five-year goal of more than USD 100 billion in combined external cloud and AI revenue, while the newly formed Token Hub is meant to bring models, model-as-a-service, and applications closer together. Alibaba also said Qwen's consumer-facing monthly active users have surpassed 300 million. The broader idea is clear: it wants its cloud, chips, and applications to reinforce one another.
What Alibaba still failed to show is that AI monetization can absorb the cost of commerce any time soon. It is building momentum in cloud and AI, but investors are still being asked to fund that push through weaker marketplace profit, thinner margins, and lower cash flow. Until those tradeoffs start to ease, the stock's upside is likely to remain constrained by the cost of defending its consumer base.
Note: RMB figures are converted to USD at rates of RMB 6.90 = USD 1 based on estimates as of March 20, 2026, unless otherwise stated. USD conversions are presented for ease of reference and may not fully match prevailing exchange rates.

Alibaba earnings come under pressure despite AI and cloud gains

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<a href="/company/tencent">Tencent</a> delivered a stronger-than-expected fourth quarter, but the market reaction suggested investors were already looking past the beat and toward the cost. Shares fell as much as 6.5% in Hong Kong the next day after management paired solid results with a warning that 2026 will bring a much heavier spending cycle for new <a href="/industry/ai">artificial intelligence</a> products.
The numbers themselves were difficult to fault. Revenue rose 13% year-on-year (YoY) to RMB 194.4 billion (USD 28.2 billion), slightly above the RMB 193.5 billion (USD 28 billion) analyst consensus tracked by LSEG, while net profit attributable to equity holders increased 14% to RMB 58.3 billion (USD 8.4 billion). On a non-IFRS basis, operating profit climbed 17% to RMB 69.5 billion (USD 10.1 billion), and gross margin widened by three percentage points to 56%.
Growth was broad-based across the businesses that matter most to Tencent's cash generation. Domestic games revenue rose 15% to RMB 38.2 billion (USD 5.5 billion), international games climbed 32% to RMB 21.1 billion (USD 3.1 billion), marketing services increased 17% to RMB 41.1 billion (USD 6 billion), and fintech and business services grew 8% to RMB 60.8 billion (USD 8.8 billion). Within that segment, business services rose 22% as cloud demand strengthened.
That mix helps explain why Tencent is willing to spend more aggressively. The company said AI was improving its incumbent businesses: better ad targeting and closed-loop tools lifted marketing pricing, Tencent's Video Accounts platform saw time spent rise by more than 20% in 2025, and Tencent Cloud moved from restructuring to profit. The cloud unit delivered RMB 5 billion (USD 724.7 million) in adjusted operating profit for the year, while management pointed to stronger pricing for memory and CPU, as well as rising AI demand.
But the cost side is no longer theoretical. Selling and marketing expenses jumped 26% YoY in the fourth quarter, while R&amp;D rose 20%. Tencent said costs and expenses for new AI products, including its Hunyuan model and Yuanbao chatbot, totaled RMB 7 billion (USD 1 billion) in the quarter and RMB 18 billion (USD 2.6 billion) in 2025. It told investors it expects to “more than double” those new AI investments in 2026.
That is the central debate in these results. Tencent is asking investors to view new AI spending as frontloaded investment rather than ordinary operating expense, and it signaled that buybacks will likely be lower this year as it redirects more cash to AI. Strategically, that may be defensible. Financially, it means the near-term cost of Tencent's AI buildout will show up in slower profit conversion and weaker capital returns before monetization is fully proven.
Tencent has room to make that tradeoff. Full-year revenue rose 14% to RMB 751.8 billion (USD 109 billion), free cash flow reached RMB 182.6 billion (USD 26.5 billion), and net cash stood at RMB 107.1 billion (USD 15.5 billion). Even so, 2025 does not yet prove that Tencent's new AI products can become a profit pool on the same scale as games, ads, or payments. It proves something narrower, but still important: the core businesses are strong enough to fund the next phase, while the return on that funding remains the question investors will watch through 2026.
Note: RMB figures are converted to USD at rates of RMB 6.90 = USD 1 based on estimates as of March 20, 2026, unless otherwise stated. USD conversions are presented for ease of reference and may not fully match prevailing exchange rates.

Tencent beats Q4 expectations, but rising AI costs weigh on outlook