The company also warned in an earnings call that profit growth may slow in the near term due to investments in new businesses and consolidation of its Ele.me food delivery unit and local services firm Koubei.
The stock closed nearly 3.2 percent lower in New York trading Thursday, down more than 18 percent from its recent high. That keeps Alibaba out of bear market territory, but still in a correction.
Shares of the other Chinese tech giants also dropped, with the KraneShares CSI China Internet ETF (KWEB) closing almost 2.3 percent lower.
Internet search company Baidu fell more than 1.5 percent and is down 22.8 percent from a recent high, in a bear market.
E-commerce company JD.com is also in a bear market, off 38 percent from a recent high. The stock closed 2.9 percent lower Thursday.
Alibaba's report rounds out a mostly disappointing quarter for the Chinese tech giants, which are often grouped under the acronym "BATJ" (Baidu, Alibaba, Tencent and JD.com) and rank among the largest internet companies in the world.
Earlier this month, Hong Kong-listed Tencent reported its first profit decline in nearly 13 years, weighed down by a drop in gaming revenues amid Chinese regulators' increased scrutiny on the industry. JD.com revenues also grew slower than analysts expected. Baidu did, however, report profits that topped Wall Street expectations.
Shares of Tencent fell more than 1 percent in Hong Kong Friday morning trading amid declines in mainland Chinese and Hong Kong stock markets.
— Reuters contributed to this report.