Alibaba's $53 Billion AI Push: Shares Surge as Tech Giant Expands AI Investment

Alibaba shares rise over 6% after CEO unveils plans to boost AI spending

Alibaba's Hong Kong-listed shares surged on Wednesday to reach their highest point since 2021 after the company said it will invest more in artificial intelligence and rolled out new AI products and updates. Shares of the company jumped over 6%, while its total gains year to date rose above 107%. The tech giant plans to increase spending on AI models and infrastructure development, on top of the 380 billion yuan ($53 billion) over three years it announced in February, Chief Executive Officer Eddie Wu said Wednesday at Alibaba Cloud's annual flagship technology conference. "We are vigorously advancing a three-year, 380 billion [yuan] AI infrastructure initiative with plans to sustain and further increase our investment according to our strategic vision in anticipation of the [artificial superintelligence] era," Wu said.

Tech giant Alibaba sees shares rise after CEO pledges AI spending lift

The e-commerce company also launched its largest ever artificial intelligence model, the Qwen3-Max, as AI competition grows between tech firms. Shares in Alibaba rose around 9% in Hong Kong on Wednesday afternoon after CEO Eddie Wu said that he would lift the firm's AI budget. The e-commerce giant had already pledged to invest 380 billion yuan (€45bn) in AI-related infrastructure over the next three years, seeking to stay ahead as firms race to develop new models. Wu did not give details on the additional expenditure. The pledge came as Wu was launching Alibaba's most powerful AI model during a company conference in Hangzhou, China. The firm's chief technology officer, Zhou Jingren, said that the Qwen3-Max model contains more than 1 trillion parameters. These are learnt values that determine how the system processes information and makes predictions. In certain metrics, Alibaba claimed that its Qwen3-Max model outperformed rival offerings like Anthropic's Claude and DeepSeek-V3.1, citing third-party benchmarks. "The industry's development speed far exceeded what we expected, and the industry's demand for AI infrastructure also far exceeded our anticipation," Wu said on Wednesday. "We are actively proceeding with the 380 billion investment in AI infrastructure, and plan to add more." Stressing that Alibaba must push ahead, Wu estimated that total global investment in AI will exceed $4 trillion (€3.4tn) in the next five years. Chinese rivals such as Tencent and JD.com, as well as US tech firms, have invested heavily in AI over the past year. Complicating Alibaba's progress, however, are access restrictions on AI processors from Nvidia. Last week, China's internet regulator banned the country's biggest tech firms from buying Nvidia's artificial intelligence chips, according to the Financial Times. The reported ban comes as China seeks to boost its homegrown chip industry and wean itself off dependence on the US. In August, Chinese firms had previously been advised not to buy Nvidia's H20, a chip designed specifically for China, with officials in Beijing warning of perceived security risks to national data and systems. The warning arrived after the US lifted its own ban on the export of H20 chips to China, imposed in April amid a trade spat.

Alibaba Shares Jump on Plan to Boost AI Spending Beyond $53B

The Chinese tech firm's CEO announced the AI spending plan, according to reports, just days after Nvidia said it would invest $100 billion in OpenAI. China's top tech firm is spending even more than it originally planned on AI, turning up the heat on U.S. chip giants like Nvidia (NVDA) in the race to dominate the technology. Alibaba Group Holdings (BABA) CEO Eddie Wu reportedly said Wednesday that the Chinese company has raised its AI budget to more than the $53 billion three-year outlay it announced in February. The spending plan marks the latest push by a tech firm to invest big in AI, the technology that has fueled U.S. stock markets to hit record highs. Nvidia said earlier this week it plans to invest up to $100 billion in ChatGPT owner OpenAI. "We are vigorously advancing a three-year, 380 billion [yuan] AI infrastructure initiative with plans to sustain and further increase our investment according to our strategic vision in anticipation of the [artificial superintelligence] era," Wu said at Alibaba Cloud's annual flagship technology conference, according to CNBC. Wu has said he sees companies globally spending around $4 trillion globally on AI over the next five years, and "Alibaba needs to keep up," Bloomberg said. Alibaba didn't immediately respond to Investopedia's request for further comment. Alibaba shares have almost doubled so far this year, as co-founder Jack Ma returned to Beijing's fold and the ecommerce giant doubled down on its "AI first strategy." On Wednesday, they rose 9% in premarket trading. Adding to the investor optimism, Cathie Wood's funds bought Alibaba shares, according to a daily trading report from her Ark Investment Management. Bloomberg noted it was the star fund manager's first purchase in the Chinese company in four years.

Alibaba's $53 Billion AI Push Is The Threat Nvidia Can't Ignore - Alibaba Gr Hldgs (NYSE:BABA), NVIDIA (NASDAQ:NVDA), Alibaba Gr Hldgs (OTC:BABAF)

Alibaba Group Holding Ltd's (NYSE: BABA) (NYSE: BABAF) stealth AI expansion may be Wall Street's blind spot -- but it's Nvidia Corp's (NASDAQ: NVDA) margin moat that's directly in the crosshairs. CEO Eddie Wu has pledged to surpass the company's $53 billion AI investment as demand for compute skyrockets, setting up a clash that could echo Beijing's solar strategy a decade ago: flooding the market with cheaper supply, undercutting Western rivals, and rewriting the margin math. * Track NVDA stock here. Nvidia's Moat Under Siege Nvidia has enjoyed a golden era, selling high-end GPUs at luxury pricing that has driven its gross margins above 70%. However, insiders warn that Alibaba's scale-driven approach could erode those margins if cheaper AI compute saturates the market. This isn't without precedent. In the late 2000s, U.S. and European solar firms operated at gross margins of 30-40%. After Chinese manufacturers like LONGi and Jinko Solar entered with massive subsidized capacity, industry margins collapsed into the 5-15% range within just a few years. Demand for solar exploded, but profits evaporated. The parallel is clear: when China industrializes a high-growth sector, pricing power doesn't survive. Read Also: Nvidia's Silicon Silk Road: From China's Firewalls To Saudi Arabia's Data Palaces The Desperate Tie-Up: Physical AI Nvidia's answer may be its "Physical AI" strategy -- a blend of hardware and services designed to deepen integration and prevent GPUs from becoming interchangeable parts. But history shows that moats can get shaky once China plays the volume game. Just ask First Solar Inc (NASDAQ: FSLR), which saw its 40% margins shrivel to the low teens by 2013. Once commoditization takes hold, it's nearly impossible to claw back pricing power. Investor Takeaway Alibaba's AI surge isn't just about winning cloud market share in Asia -- it could be the stealth margin killer for Nvidia's global business. With $53 billion in spending echoing the solar playbook, investors betting on endless 70% gross margins for GPUs may be overlooking a structural risk. The AI hardware wars are only just beginning, and if history repeats itself, the cheaper side usually wins. BABAAlibaba Group Holding Ltd $179.034.14% Overview BABAFAlibaba Group Holding Ltd $19.63-9.73% NVDANVIDIA Corp $182.182.24% FSLRFirst Solar Inc $226.252.83% Market News and Data brought to you by Benzinga APIs

Why Alibaba Stock Jumped Today

Alibaba's artificial intelligence (AI) ambitions are expanding. The rally in Alibaba (BABA 8.60%) stock continued today after the Chinese tech giant just announced plans to ramp up its spending on artificial intelligence (AI). That's been a winning approach for American tech stocks, so it wasn't a surprise to see Alibaba jump on the news. As of 10:22 a.m. ET, the stock was up 9%. Alibaba keeps moving higher Alibaba announced several initiatives around AI yesterday, including a new partnership with Nvidia, and plans to open new data centers around the world. It also introduced a new AI model that has over 1 trillion parameters. The company made the announcement at its annual Apsara Conference. Those initiatives come after the company had announced earlier this year that it would spend $50 billion on AI infrastructure over the next three years. The news also earned it some positive commentary from Bank of America, which raised its price target from $168 to $195, and reiterated a buy rating on the stock. It also said Alibaba was set up as the world's leading full-stack AI services provider. What's next for Alibaba? Alibaba has delivered an impressive comeback after the stock was essentially dead money for three years due to a crackdown from Beijing and then weak growth due to challenges in the Chinese economy. Like other tech stocks, though, Alibaba has been rescued by the AI boom. However, the business's growth is still modest, as organic revenue was up 10% in the June quarter to $34.6 billion, and its adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) was down 11% to $6.4 billion. Still, its cloud intelligence business is delivering strong growth, up 26% in the quarter, and investors should keep their eye on that segment going forward. If Alibaba is a winner in AI, the proof will show up there.

Alibaba Surges 107% After Boosting AI Budget Beyond $50 Billion And Reporting Strong Cloud Growth - Alibaba Gr Hldgs (NYSE:BABA)

Alibaba Group (NYSE: BABA) stock climbed to its highest level in nearly four years after the company announced it would increase artificial intelligence spending beyond its previously disclosed $50 billion-plus target. The stock is trading lower on Thursday, but it is still up 107% year-to-date, surpassing the NYSE Composite index (which includes Alibaba) by over 12% in returns. Incoming CEO Eddie Wu projected global AI investment could reach $4 trillion within five years and confirmed Alibaba will add to its February plan to spend 380 billion yuan ($53 billion) over three years on AI models and infrastructure, Bloomberg reported on Thursday. Also Read: Alibaba Faces Fresh Scrutiny As China Cracks Down On Online Content Violations Wu said the company's cloud division, already spanning the U.S. to Australia, will expand with new data centers in Brazil, France and the Netherlands, while also rolling out its Qwen large language models and full-stack AI services. Wu added that AI development is advancing faster than expected, driving heavier demand for infrastructure. Co-founder Jack Ma reasserted his role at Alibaba. After retreating during Beijing's tech crackdown, he is now steering strategy under the internal slogan "Make Alibaba Great Again," directing senior leaders Eddie Wu, Joe Tsai, and Jiang Fan to focus on AI and cloud investments. The Chinese e-commerce juggernaut reported triple-digit growth in AI-related products and a 26% sales jump in its cloud business in its fiscal first quarter. Ark Investment's Cathie Wood also disclosed fresh stakes in Alibaba after four years, citing Beijing's more supportive stance and Alibaba's global expansion. Alibaba rivals, Tencent (OTC: TCEHY), Baidu (NASDAQ: BIDU) and JD.com (NASDAQ: JD), are collectively projected to spend over $32 billion on AI infrastructure in 2025, up sharply from 2023. Facing U.S. chip export restrictions, Alibaba has also been developing its own semiconductors through its T-Head unit, recently securing China Unicom as a customer for its Pingtouge AI accelerators. At the same time, it is integrating Nvidia's (NASDAQ: NVDA) AI development tools into its cloud. Price Actions: BABA stock was trading lower by 1.12% to $174.53 at last check on Thursday. Read Next: Nvidia Commits $500 Million To UK Autonomous Driving Startup Wayve Photo: Shutterstock BABAAlibaba Group Holding Ltd$173.61-1.60%OverviewBIDUBaidu Inc$135.912.25%JDJD.com Inc$35.471.84%NVDANVIDIA Corp$177.870.51%TCEHYTencent Holdings Ltd$83.190.58%Market News and Data brought to you by Benzinga APIs

Why Is Alibaba Stock Soaring Wednesday? - Alibaba Gr Hldgs (NYSE:BABA), NVIDIA (NASDAQ:NVDA)

Alibaba Group BABA is deepening its artificial intelligence ambitions by integrating Nvidia's NVDA suite of "physical AI" development tools into its cloud platform, a move that strengthens ties between two of the most influential players in global AI. Alibaba shares rose on Wednesday following the announcement. The integration gives customers of Alibaba's Cloud Intelligence unit direct access to Nvidia's software for developing AI systems designed to interact with the physical world, including humanoid robots and autonomous vehicles, Bloomberg reported on Wednesday. The announcement was made at Alibaba's annual Apsara developer conference in Hangzhou, where the company confirmed that its platform for AI will now feature Nvidia's complete Physical AI software stack. Also Read: Jack Ma Back At Alibaba? What's Going On The partnership combines Nvidia's dominance in AI hardware and frameworks with Alibaba's scale as one of China's leading providers of cloud services and digital infrastructure. Alibaba also used the conference to outline its global expansion plans, unveiling its first data centers in Brazil, France, and the Netherlands, according to Reuters. Additional facilities are slated to open in Mexico, Japan, South Korea, Malaysia, and Dubai within the next year. These expansions will extend Alibaba Cloud's footprint beyond its current 91 availability zones across 29 regions. The company also highlighted progress in its own AI models. It introduced Qwen3-Max, its most advanced large language model to date, boasting more than one trillion parameters. On benchmarks such as Tau2-Bench, Qwen3-Max outperformed rivals including Anthropic's Claude and DeepSeek-V3.1. Alongside that, Alibaba debuted Qwen3-Omni, a multimodal system aimed at applications like smart glasses and intelligent cockpits, reinforcing its ambition to drive AI adoption across both consumer and enterprise markets. Recent reports indicate CEO Eddie Wu intends to further accelerate AI investment. Wu had previously pledged to expand Alibaba's AI infrastructure spending beyond the 380 billion yuan ($53 billion) disclosed earlier this year, a commitment that has helped propel Alibaba's shares to their highest level in nearly four years. Year-to-date, Alibaba's stock has surged more than 92%, far outpacing the NYSE Composite index's 13% gain. The rally reflects investor optimism in the company's AI models, cloud growth, and resilient e-commerce operations. The company is also stepping up direct competition with U.S. tech giants. Last week, Alibaba introduced a high-performance processor through its semiconductor arm, T-Head, designed to rival Nvidia's H20. State media reported the PPU chip matches the H20's performance while consuming less power. Simultaneously, Alibaba's Tongyi Lab launched a lightweight open-source "deep research" agent, an alternative to OpenAI's Deep Research, already embedded into services such as Amap and a legal research platform. Price Actions: BABA stock was trading higher by 9.26% to $178.18 premarket at last check Wednesday. Read Next: Alibaba Faces Fresh Scrutiny As China Cracks Down On Online Content Violations Photo by Stock-Asso via Shutterstock BABAAlibaba Group Holding Ltd$178.489.44%OverviewNVDANVIDIA Corp$179.600.66%Market News and Data brought to you by Benzinga APIs

Alibaba's $53 Billion AI Bet Reignites Investor Confidence in Chinese Tech | Investing.com UK

Alibaba's (NYSE:BABA) decision to boost AI spending beyond $53 billion has electrified Chinese tech stocks, lifting its own shares to a four-year high and sparking a rally across the country's semiconductor ecosystem. The move signals not only the company's strategic pivot but also Beijing's broader ambition to build a self-sustaining AI supply chain. For investors, this development underscores both the opportunities and risks of betting on China's technology rebound at a time of shifting global capital flows and intensifying competition with U.S. peers. Alibaba's Hong Kong-listed stock surged 7.2% on Wednesday, outpacing the 2.1% gain in the Hang Seng Tech Index. The rally followed CEO Eddie Wu's announcement that the company would raise its AI and cloud infrastructure spending above the 380 billion yuan ($53 billion) pledged earlier this year. While Wu did not disclose an updated figure, the investment will be deployed over three years -- a sign of commitment to long-horizon growth rather than short-term market optics. The unveiling of Alibaba's Qwen3-Max, its most advanced large language model, added to the momentum. This positioned the company in direct competition with OpenAI, Anthropic, and a growing roster of domestic challengers such as Baidu, Tencent, ByteDance, and startup DeepSeek. In a market where scale and compute power are defining advantages, Alibaba is signaling it intends to be more than a fast follower. Adding fuel to the rally, Cathie Wood's ARK Invest reopened positions in Alibaba for the first time since 2021. Two ARK funds purchased $16.3 million worth of the company's ADRs, suggesting a tentative return of U.S. investor appetite after years of regulatory headwinds. For context, Alibaba's prior slump stemmed largely from Beijing's sweeping crackdown on its internet sector, which eroded global confidence in Chinese equities. The re-entry of foreign funds may indicate that investors view Beijing's stance toward tech as more supportive, especially as the government seeks to accelerate AI development to reduce reliance on U.S. firms and infrastructure. If this trend continues, foreign capital inflows could complement domestic policy support, lifting valuations across the sector. Alibaba's announcement triggered a broad rally in Chinese semiconductor names. SMIC, the country's largest contract chipmaker, rose nearly 8%, while Hua Hong climbed 9%. Naura Technology, a leading chip-equipment manufacturer, hit the daily 10% limit in Shanghai. The surge reflects rising confidence that domestic AI breakthroughs will translate into sustained demand for compute capacity, benefiting foundries and upstream equipment suppliers alike. Morningstar's Phelix Lee captured the sentiment, noting that China is "building up a self-contained virtuous cycle" in the AI supply chain. This aligns with Beijing's broader industrial policy goal of reducing dependence on foreign semiconductors, a strategic imperative amid escalating U.S. export restrictions. The timing of Alibaba's upswing is notable. Chinese equities have lagged global peers for much of the past three years, weighed down by weak consumer demand, property sector stress, and persistent capital outflows. The AI theme, however, has created a counter-narrative, one that mirrors the AI-driven surge in U.S. mega-caps like Nvidia and Microsoft. Still, differences remain stark. Chinese AI players face restricted access to cutting-edge chips due to U.S. export controls, forcing reliance on domestically produced semiconductors. This constraint could either catalyze accelerated self-sufficiency or limit global competitiveness. Investors must weigh whether policy support and massive capital commitments will offset these structural disadvantages. Alibaba's renewed AI push highlights a bullish scenario where China's tech giants create a self-sustaining ecosystem that drives domestic semiconductor demand, re-attracts foreign investors, and restores growth momentum in Chinese equities. Yet risks remain. The lack of access to advanced chips, lingering geopolitical tensions, and the possibility of renewed regulatory interventions could cap upside. Moreover, valuations are sensitive to global capital flows, meaning any shift in U.S.-China relations could reverse recent gains.

Alibaba Shares Surge as It Boosts Bet on AI, Rolls Out New Model

Alibaba Group shares jumped after the company said it will invest more than $53 billion in artificial intelligence--above its original target--and released a new model. The Chinese tech titan's Hong Kong-listed stock rallied on Wednesday, helping it more than double gains so far this year. Shares were recently 7.2% higher, outperforming the Hang Seng Tech Index's 2.1% advance. Alibaba's stock is at its highest level in four years. The Hangzhou-based company's latest upswing came after Chief Executive Eddie Wu said it will increase spending on AI and cloud infrastructure beyond the 380 billion yuan pledged in February, equivalent to $53 billion. He didn't specify an amount but said the funds would be deployed over three years. "The AI industry has developed much faster than we expected, and demand for AI infrastructure has also far exceeded our expectations," Wu said. Alibaba raising its capital-expenditure guidance is a good sign that demand for AI infrastructure is even stronger than expected, said Morningstar's Chelsey Tam. "More demand means a more positive outlook," Tam said, underlining AI and cloud as bright spots for Alibaba. Markets seem to be viewing the management's outlook for AI demand in China as upbeat, Nomura's Jialong Shi said. That might have soothed worries about increasingly tough competition in the AI space and the potential formation of an asset bubble as more companies enter the space and investors pile into stocks. Adding to the market buzz on Wednesday was Alibaba's latest addition to its flagship AI model series, the Qwen3-Max, which it described as its "largest and most capable" large-language model yet. The new model, which contains more than 1 trillion parameters, has strong coding and agentic capabilities, Qwen said in a social-media post. Parameters are like knobs that get tuned during training so that AI models can make better decisions. Alibaba's push comes as Chinese tech giants race to develop LLMs to rival offerings from foreign companies like OpenAI and Anthropic. Baidu, Tencent Holdings and ByteDance have all rolled out their own products, while homegrown startups such as DeepSeek have also quickly gained traction. Another tailwind for Alibaba's stock came in the form of news that two of Cathie Wood's Ark Invest funds reopened positions in the tech company, signaling a rekindling of interest from abroad in Chinese tech. The two funds' investments in Alibaba's American depositary shares total around $16.3 million, according to holdings reports. Securities and Exchange Commission filings show that this is Ark's first investment or proxy voting record in Alibaba since September 2021, when the Chinese internet giant was grappling with a regulatory crackdown on the country's tech sector. Alibaba's investment plan and model release add to a broader upswing in Chinese tech stocks, which have been powering equities markets onshore and offshore as advancements bolster investors' conviction in China's AI sector. In Hong Kong, SMIC--the largest contract chip maker in China--rose as much as 7.8%, while China's No. 2 foundry, Hua Hong, advanced as much as 9.0%. Naura Technology, the country's biggest chip-equipment maker, climbed by the 10% daily limit in Shanghai. "China is building up a self-contained virtuous cycle" in the AI supply chain, Morningstar analyst Phelix Lee said. A flurry of AI progress by Chinese tech giants "signals stronger confidence in the performance of China-made models, which supports demand for semiconductors, benefiting both foundries like SMIC & Hua Hong and upstream equipment plays," he said. --Jason Chau contributed to this article. Write to Tracy Qu at [email protected] and Sherry Qin at [email protected]