Alibaba said its cloud unit delivered $1.13 billion in revenue for its fiscal first quarter as Alibaba Cloud now represents 7% of overall sales.
With Alibaba Cloud now at an annual revenue run rate of $4.5 billion, the company said it is focused on high value security, analytics and artificial intelligence tools and "rationalizing our offerings of commodity products and services." That run rate is impressive, but trails Google Cloud's $8 billion run rate and other cloud giants.
Revenue for Alibaba Cloud was up 66% from a year ago. Specifically, Alibaba Cloud said it was aiming to expand its software as a service offerings via partners. Alibaba Cloud is looking to expand its ecosystem for enterprises and help developers expand their markets.
Alibaba Cloud is seen as a go-to service provider in China and for companies with operations there, but remains a niche player globally, according to Gartner.
While Alibaba Cloud is critical to the company's profit profile, e-commerce operations continue to dominate. Alibaba reported total first quarter revenue of $16.74 billion, up 42% from a year ago with net income of $3.1 billion ($4.51 billion non-GAAP).
Alibaba's annual active customers hit 674 million with mobile monthly active users of 755 million.