Alibaba Group (BABA) stock scrambled higher early Thursday after the Chinese tech giant reported fiscal third-quarter earnings and sales that beat expectations. Cloud revenue for Alibaba growth accelerated, with the company touting strong AI-related demand.

Alibaba said that it earned an 21.39 yuan per share on sales of 280.38 billion yuan, or $38.4 billion, for the December-ended quarter. Analysts polled by FactSet projected Alibaba would post earnings of 19.47 yuan per share on sales of 278.49 billion yuan.

Revenue growth of 7.6% year-over-year, based on local currency, accelerated from 5.2% growth in Alibaba's September quarter.

"This quarter's results demonstrated substantial progress in our 'user first, AI-driven' strategies and the reaccelerated growth of our core businesses," Chief Executive Eddie Wu said in a news release.

Revenue from Alibaba's Cloud Intelligence Group increased 13% year-over-year to 31.7 billion yuan, compared to estimates of 9.8% growth. Alibaba's news release said that AI-related product revenue posted "triple-digit" year-over-year growth from a sixth consecutive quarter. Cloud sales grew 7% in Alibaba's September quarter.

On the stock market today, Alibaba stock is up 6% at 134.19 in recent premarket trading.

More earnings coverage to come.

Alibaba Stock: Technical Ratings

Not including Thursday's jump, Alibaba has rallied 48% this year to approach a three-year high. The stock rallied 20% last week, helped by news that Apple (AAPL) will be working with Alibaba to introduce AI features to iPhone in China.

Alibaba stock broke out of a cup-with-handle pattern on Feb. 7, above a 103.67 buy point, according to MarketSurge. Shares reached a high of 129.02 Tuesday, Alibaba's highest level since February 2022.

Meanwhile, Alibaba stock has an IBD Composite Rating of 95 out of a best-possible 99, according to IBD Stock Checkup. The score combines five separate proprietary ratings into one rating. The best growth stocks have a Composite Rating of 90 or better.

Further, Alibaba's IBD Relative Strength Rating is 95 out of 99. The RS Rating means that BABA stock has outperformed 95% of all stocks in IBD's database over the 12 months.

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