Alibaba stock surges 12% as AI cloud strength offsets Anthropic dispute and Pentagon scrutiny

Why Is Alibaba Stock Soaring Tuesday? - Alibaba Gr Hldgs (NYSE:BABA)

Alibaba shares have fallen more than 33% year to date as investors worried about China's slowing economy and questioned how quickly the company could monetize its AI investments. However, Jefferies Hong Kong analyst Thomas Chong believes much of that pessimism is already reflected in the stock price. According to Bloomberg, Chong expects Alibaba to deliver solid execution in the June quarter. He also expects AliCloud to post faster year-over-year growth, supported by rising demand for AI services. Anthropic Ban And Court Win Draw Attention Alibaba also remained in focus after two major developments. The move followed Anthropic's allegation that Alibaba attempted to distill its AI capabilities. Earnings Remain The Next Key Catalyst Investors are now looking ahead to Alibaba's estimated Aug. 28, 2026, earnings report. Wall Street expects earnings per share of $2.51, up from $2.06 a year earlier. Revenue is projected to reach $38.72 billion, compared with $34.57 billion in the prior-year quarter. The stock trades at about 15.2 times earnings, suggesting a valuation that is broadly in line with peers. ETF Exposure Could Influence Trading As a result, significant fund inflows or outflows could lead to automatic buying or selling of Alibaba shares. Price Action BABA Stock Price Activity: Alibaba shares were up 11.34% at $109.27 during premarket trading on Wednesday, according to Benzinga Pro data. Image via Shutterstock Market News and Data brought to you by Benzinga APIs To add Benzinga News as your preferred source on Google, click here.

Alibaba shares defy major AI scandal as Wall Street bites

Alibaba Group Holding (BABA) stock surged in premarket trading on Wednesday after a wave of good news landed at once. Just days earlier, Alibaba and Anthropic were trading accusations, not compliments, in a dispute over stolen AI technology and hidden tracking code. The rally proves those two storylines can run side by side, one bruising and one bullish, with neither resolved. Alibaba and Anthropic's feud escalates Alibaba banned employees from using Anthropic's Claude Code for work starting July 10, according to CNBC. The company placed the coding tool on a high-risk software list after developers found code capable of detecting whether a user was based in China. The ban follows a separate accusation. Anthropic told the U.S. Senate Banking Committee that operators linked to Alibaba's Qwen lab ran roughly 25,000 fraudulent accounts to extract Claude's capabilities through "distillation," Reuters reported. Distillation trains a cheaper model on a stronger one's outputs, and Anthropic called this the largest attempt of its kind. Alibaba told staff to switch to its own coding platform, Qoder, instead of Claude Code. As TheStreet has noted, the fight is really about who owns the developer relationship, not just which tool carries more risk. That context matters for reading the recent rally in its stock. Alibaba is absorbing a real reputational hit from a major U.S. AI lab even as its stock climbs on unrelated news. NurPhoto / Getty Images A cloud market share report adds fuel Alibaba Cloud held a 40.1% share of China's full-stack AI cloud market, ahead of Baidu, ByteDance's Volcano Engine, and SenseTime combined, according to a Seeking Alpha report citing Frost & Sullivan data. That figure gave investors a reason to look past the Anthropic dispute and focus on Alibaba's underlying AI business instead. A separate court ruling added to the momentum. A federal judge paused a Pentagon rule that had stripped Alibaba of its Washington lobbyists over an alleged military link, according to Bloomberg. The reprieve does not resolve the underlying case, but it restores Alibaba's access to policy channels while the fight continues. Supporting context on that legal dispute: * The Pentagon's list of alleged Chinese military companies grew to 188 firms in June, up from roughly 130, according to Fortune. * Baidu and BYD were added to the same list and are contesting their inclusion. * A hearing on Alibaba's underlying challenge will determine how long the reprieve lasts, according to Fortune. The rally only dents a rough year BABA shares traded above $108 on July 8, up from a previous close near $98, marking a one-day move of roughly 10%. Alibaba runs China's largest e-commerce and cloud computing businesses, and its stock often trades as a proxy for investor sentiment toward Chinese tech broadly. The shares entered the Wednesday session down more than 30% for the year. However, the significant rally helped the stock recoup some of those losses, according to data tracked by TheStreet. Alibaba's share price has been squeezed by regulatory pressure, heavy AI infrastructure spending, and now a public dispute with one of the most restrictive AI labs on Chinese access. Some of Wednesday's gain also traces back to Alibaba's own numbers. Losses in its instant-delivery business narrowed significantly in the June quarter, easing concern about spending ahead of the company's August 28 earnings report, according to a Seeking Alpha report. The bigger story is decoupling Alibaba's surge reflects a larger pattern than a single earnings quarter or a single court order. American AI labs are tightening access to their models, and Chinese companies are responding by building substitutes rather than negotiating around the restrictions. Qoder, not Claude Code, is now the standard at one of China's largest tech employers. That kind of substitution is happening firm by firm across China's tech sector, independent of what Alibaba's stock does in any given week. Investors chasing the rally are betting that Alibaba's cloud numbers will hold up. The more durable question is how many more Chinese companies follow Alibaba away from American AI tools before that shift becomes permanent. The Arena Media Brands, LLC THESTREET is a registered trademark of TheStreet, Inc. This story was originally published July 9, 2026 at 12:37 PM.

Jefferies reaffirms Alibaba stock rating on AI strength By Investing.com

Investing.com - Jefferies reiterated a Buy rating and $185.00 price target on Alibaba Group Holding Ltd (NYSE:BABA). The stock currently trades at $98.14, near its 52-week low of $91.99, and InvestingPro analysis suggests the company is undervalued relative to its Fair Value. An InvestingPro Tip notes that Alibaba holds more cash than debt on its balance sheet, underscoring its financial strength. The firm expects Alibaba to demonstrate strong execution despite macro headwinds with combined EBITA for China e-commerce and AIDC to be flat year-over-year in the June quarter. Softness in industry GMV growth is in the price. Jefferies said QC fundamentals came in better than expectations. For AliCloud, the firm expects it to accelerate year-over-year and perform better than expectations on strengths in AI demand and MaaS. Sequential improvement in cloud margin is expected. The firm reaffirmed Alibaba as a top pick on the AI story ahead. Jefferies analyst Thomas Chong maintained the rating and price target on the Chinese e-commerce and cloud computing company. With a market cap of $224 billion and a P/E ratio of 20.08, Alibaba trades at what many analysts view as attractive levels despite the stock's 36% decline over the past six months. In other recent news, Alibaba has made significant strides in its AI capabilities by announcing a comprehensive upgrade to its AI stack, which includes cloud infrastructure, model services, AI chips, and foundation models. This development was unveiled at the Alibaba Cloud Summit, where the company introduced its latest large language model, Qwen3.7-Max, designed for complex reasoning and task execution. Alibaba's financial performance has also been a focal point, with the company reporting fourth-quarter revenue of RMB243 billion, marking a 3% year-over-year increase, or 11% when excluding certain disposals. Analysts have responded to these developments with positive ratings. Benchmark reiterated a Buy rating with a $220 price target, noting Alibaba's cloud growth and group-level profitability. Similarly, Bernstein maintained an Outperform rating, highlighting RMB9 billion in AI revenue, which accounts for 30% of external Alicloud revenue. Deutsche Bank also raised its price target to $195, citing cloud growth as a key factor. In a separate development, Chinese regulators are taking action against several cross-border brokerages, including Futu Holdings, UP Fintech Holding's Tiger Brokers, and Longbridge Securities, for operating without proper licenses. The China Securities Regulatory Commission plans to confiscate illegal gains and impose penalties on these firms. These recent developments reflect both Alibaba's technological advancements and broader regulatory challenges in the market. This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

Why is Alibaba stock surging today? By Investing.com

Investing.com -- Alibaba stock surged 12.2% to reach HK$107.5, its largest single-session gain since September 2025, after a pre-earnings briefing indicated that losses in the company's instant-commerce business narrowed meaningfully in the June quarter while overall profitability remained intact -- a combination that reignited investor confidence ahead of the August 28 earnings report. The signal that the costly push into on-demand delivery is beginning to pay off removed a key overhang that had weighed on the stock, which had shed roughly 27% in the prior month amid geopolitical headwinds including a Pentagon "Chinese military company" designation and U.S. legislative threats targeting Chinese AI model distillation. Adding fuel to the rally, reports emerged that Alibaba is systematically consolidating its enterprise AI Agent product line, folding three separate tools -- QoderWork, Wukong, and MuleRun -- into a single unified productivity platform to be led by DingTalk CEO Chen Yusen. Alibaba Cloud's revenue growth also reportedly accelerated in the first quarter of fiscal 2027, strengthening the case that the company's heavy AI infrastructure investments are translating into commercial traction. Separately, the company's ongoing share buyback program -- which saw approximately 4.11 million shares repurchased on July 6 for roughly $50 million -- underscored management's conviction in the stock's value at current levels. The move was amplified by a broad rotation into Hong Kong-listed Chinese internet stocks that had lagged the wider market. The Hang Seng Tech Index climbed over 5% on the session, with sector peers also posting strong gains. This sector-wide re-rating reflected growing analyst conviction that leading Hong Kong internet companies are due for a valuation reassessment as their AI transformation strategies mature. Taken together, the combination of improving near-term earnings visibility, a credible AI product integration story, accelerating cloud revenue, and active capital return created a powerful confluence of catalysts. With the stock still trading well below its 52-week high of HK$186.2 despite today's advance, investors appear to be pricing in a meaningful recovery from what had been an oversold position. This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.