Alibaba has committed to investing at least 380 billion yuan ($52.44 billion) in cloud computing and artificial intelligence (AI) over the next three years, marking a major push into the AI sector.
This announcement comes as part of the company's broader strategy to capitalize on the growing demand for AI technology in China.
The Chinese e-commerce giant made the statement on Monday, following its earnings report for the quarter ending December 31.
In the report, Alibaba revealed a revenue of 280.15 billion yuan, slightly surpassing analysts' expectations.
This figure is a sign of the company's continued growth as it integrates AI into its core operations.
Alibaba's total planned investment in AI and cloud computing will exceed the amount spent in the last decade, underlining the importance the company places on the sector.
According to Reuters, Alibaba's stock has risen by more than 68% this year, fueled by strategic investments and strong business performance, particularly in AI.
In a recent earnings call, Alibaba CEO Eddie Wu emphasized the company's goal of developing Artificial General Intelligence (AGI), which refers to AI that can match or surpass human intelligence.
He described AGI as an opportunity for industry transformation that "comes along once every several decades," positioning it as Alibaba's primary objective in the AI space.
The push to accelerate AI development also aligns with China's broader efforts to compete in the AI race with the United States.
Alibaba's Qwen AI models have already gained recognition for their strong performance in benchmark tests, solidifying its position as one of the top players in China's AI industry.
Additionally, Alibaba has partnered with Apple to incorporate its AI technology into Chinese iPhones.
BREAKING NEWS: ALIBABA BOLSTERS AI DOMINANCE WITH $53 BILLION INVESTMENT
— PONKE (@Ponkeeeeee) February 24, 2025
Alibaba Group $BABA has announced a staggering RMB 380 billion $53 billion investment in cloud computing and AI infrastructure over the next three years, marking a major push toward Artificial General… pic.twitter.com/QR4BxmNRGO
Alibaba Sees 13% Cloud Revenue Growth Amid AI Push and Global Expansion
As part of its investment in AI, Alibaba has already begun integrating AI into its cloud products. The company's cloud business saw a 13% revenue increase year-over-year, the fastest pace in two years.
Furthermore, Alibaba's international commerce unit, which includes platforms like AliExpress and Lazada, achieved a 32% growth in revenue, largely driven by strong cross-border performance.
Alibaba's major push into AI comes after a tumultuous period for the company. In 2020, it faced a severe regulatory crackdown, which included the halting of Ant Group's planned IPO and a $2.8 billion fine for violating anti-monopoly laws, AP News said.
The company also dealt with challenges related to the disappearance of co-founder Jack Ma from public view.
However, the Chinese government's recent shift towards supporting the tech industry in the face of escalating US-China tensions has benefitted companies like Alibaba, positioning them for future success in the global technology race.
In addition to Alibaba's investment, other Chinese companies like ByteDance, the owner of TikTok, are also heavily investing in AI.
ByteDance has earmarked more than 150 billion yuan for capital expenditure this year, with a significant portion allocated to AI development.
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