Alibaba to invest $70 billion in AI over next 3 years in major pivot
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The amount would be more than Alibaba has spent on its AI and cloud computing network over the past decade.
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BeIJING - Alibaba Group Holding pledged on Feb 24 to invest more than 380 billion yuan (S$70 billion) in artificial intelligence (AI) infrastructure such as data centres over the next three years, a major commitment that underscores the e-commerce pioneer’s ambitions of becoming a leader in the field.
The internet company co-founded by Mr Jack Ma plans to spend more on its AI and cloud computing network than it has over the past decade.
Alibaba envisions becoming a key partner to companies developing and applying AI to the real world as models evolve and need increasing amounts of computing power, the company said on its official blog.
The Chinese company is righting a business knocked off-kilter by a government clampdown that began in 2020, refocusing its ambitions on e-commerce and AI.
Last week, chief executive Eddie Wu declared that artificial general intelligence, or AGI, was now its primary objective, joining a race so far led by the likes of OpenAI and big US firms from Microsoft to Google parent Alphabet.
Major technology firms from Facebook owner Meta Platforms to Amazon.com have similarly pledged billions towards the data centres needed to train, develop and host AI services – a vote of confidence in the technology’s future.
Yet Wall Street has begun to question whether there will be enough demand to use up all that capacity, particularly after Chinese upstart DeepSeek unveiled a model trained for a fraction of the cost of many of its rivals.
Alibaba’s Hong Kong shares erased gains and were down as much as 2.5 per cent on Feb 24.
Alibaba’s three-year timeline lags behind its US peers: Microsoft for one expects to spend US$80 billion (S$107 billion) this fiscal year on AI data centres, while Meta has earmarked some US$65 billion for 2025. That is in part because Alibaba is a relatively newer entrant to the field, though it has operated an AWS-like platform globally for years. Chinese companies in general are also limited by US sanctions from buying the most expensive Nvidia AI chips for their data centres – a factor that curtails computing power but also helps cap costs.
Still, investors have applauded Alibaba’s growing determination to compete in AI. Mr Wu’s reference to AGI – powerful, hypothetical AI systems that could emulate or match human thinking capabilities – is striking in the context of Alibaba’s traditional online retail business.
Alibaba has gained more than US$100 billion of market value in 2025, though it is still far from its pre-crackdown peak.
Mr Ma himself joined a select group of the biggest names in Chinese technology and business at a televised summit convened last week by Chinese President Xi Jinping
Since the advent of OpenAI’s chatbot, Alibaba has invested in a clutch of China’s most promising start-ups, including Moonshot and Zhipu. It prioritised the expansion of the cloud business that underpins AI development, slashing prices to win back the customers that fled during the turbulent years.
Alibaba has unveiled a Qwen model that performed well in official benchmark tests and signalled the company’s growing relevance in the field.
Apple is incorporating Alibaba’s AI technology into Chinese iPhones, a vote of confidence in its prowess. BLOOMBERG
