Alibaba Group Holding Ltd. has smashed revenue projections, documenting a 34 percent surge in growth based on high demand for cloud computing amid the AI boom.

As a result of surging sales, Alibaba’s share rose 4.3 percent higher in premarket trade.

In the September quarter, the revenue results were strong, spiking 5 percent to 247.8 billion yuan ($35 billion), thereby surpassing the expectations. In 2024, the revenue was around 242.65 billion yuan.

The rapid surge in growth came on the heels of investors’ growing interest in Alibaba’s cloud computing division. Based on cloud computing, the company secured 39.8 billion yuan in revenue, shattering the expectations of 37.9 billion yuan.

CEO Eddie Wu issued a statement on Tuesday “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.”

In September, the company announced plans to join the AI boom driven by spending on cutting-edge AI models and infrastructure establishment.

In February, the Chinese company also planned to invest 380 billion yuan ($53 billion) over the period of three years.

As per official authorities, the firm, in the past four quarters, has spent around 120 billion yuan in cloud computing infrastructure and AI.

Amid AI push, Alibaba has become China’s leading AI player. On Monday, AI-powered Alibaba’s Qwen app overshadowed OpenAI’s ChatGPR by amassing 10 millions downloads within the first week of launch.