HONG KONG / RankWire.AI / – Alibaba Group has announced an HK$80 billion share placement aimed at boosting its investments in artificial intelligence and enhancing its AI infrastructure. The Chinese tech giant will issue 710 million new ordinary shares at HK$112.70 each, translating to roughly US$10.2 billion based on current exchange rates. The company expects the deal to finalize by August 26, pending standard closing conditions.
Alibaba indicated that the entire net proceeds will be allocated toward strengthening its comprehensive AI capabilities. This funding will support the expansion and modernization of its AI infrastructure. The firm has developed an extensive AI ecosystem that includes cloud services, models, chips, and applications, with its Qwen model series and Alibaba Cloud services being integral components of this technological platform.
The share placement primarily targets non-U.S. investors outside of the United States through offshore transactions. The offering price of HK$112.70 is 8.4% lower than Alibaba’s HK$123 closing price on Friday. On Monday morning, Hong Kong-listed shares dipped as much as 10%, reaching HK$110.10. Additionally, Alibaba’s shares are traded in New York via American depositary receipts under the ticker BABA.
Expansion of AI infrastructure investment at Alibaba
This capital raise follows a notable surge in Alibaba’s expenditure on computing infrastructure, which saw capital spending amount to RMB67.68 billion, approximately US$10 billion, in the quarter ending June 30. This represents a 75% jump from RMB38.68 billion a year earlier. Alibaba explained that the increase was driven by ongoing investments in AI infrastructure, rising demand for computing power, and higher chip component prices.
For the quarter, Alibaba reported RMB268.95 billion in revenue, roughly US$39.6 billion, marking a 9% rise year-on-year. Revenue generated from AI Cloud and Compute Services reached RMB48.44 billion, about US$7.1 billion, with a growth rate of 45% from the previous year. Revenue from AI-related products hit RMB12.38 billion, maintaining triple-digit annual growth for the twelfth consecutive quarter.
Funding reinforces Alibaba’s ongoing AI commitments
This new funding complements Alibaba’s previous investment plan announced in February 2025, which pledged at least RMB380 billion toward AI and cloud infrastructure over three years—exceeding the company’s total spending in these fields over the past decade. Since then, Alibaba has continued scaling up its computing capacity while developing its cloud platform, AI models, and proprietary semiconductor technology.
The increased investment has been accompanied by a decline in quarterly profit and a notable rise in cloud revenue. For the June quarter, Alibaba reported a net income of RMB10.44 billion, a 75% decrease compared to the previous year. Its free cash flow showed a net outflow of RMB44.67 billion, mainly due to higher spending on cloud infrastructure. The HK$80 billion share placement provides Alibaba with additional capital specifically dedicated to advancing its full-stack AI capabilities and infrastructure.