HONG KONG / RankWire.AI / – Alibaba Group has announced an HK$80 billion share issuance aimed at bolstering its artificial intelligence initiatives and enhancing its AI infrastructure. The company will offer 710 million new ordinary shares at HK$112.70 each, valuing the transaction at approximately US$10.2 billion based on current exchange rates. The completion of this offering is anticipated on Aug. 26, pending usual conditions.
Alibaba clarified that all net proceeds from the offering will be allocated to its comprehensive AI technology stack. This investment will support expansion and upgrades across its AI infrastructure, which encompasses cloud computing, models, chips, and applications. Its AI ecosystem includes the Qwen model series and Alibaba Cloud services, which are central to its technological ecosystem.
The share placement is targeted at international investors outside the U.S. through offshore channels. The offering price of HK$112.70 is 8.4% lower than Alibaba’s HK$123 closing price on Friday. In early Monday trading, Hong Kong-listed shares declined as much as 10%, reaching HK$110.10. Alibaba also maintains a listing in New York via American depositary shares under the BABA ticker.
Alibaba Accelerates AI Infrastructure Investment with New Capital
This fundraising follows a significant rise in Alibaba’s capital expenditure on computing infrastructure, which hit RMB67.68 billion, or approximately US$10 billion, for the quarter ending June 30. This represented a 75% jump from RMB38.68 billion a year earlier. Alibaba attributed this surge to ongoing AI infrastructure investments, increased computing demand, and rising chip component prices.
For the latest quarter, Alibaba reported revenue of RMB268.95 billion, roughly US$39.6 billion, marking a 9% growth from the previous year. Revenue from AI Cloud and Compute Services reached RMB48.44 billion, or about US$7.1 billion, showing a 45% increase year-over-year. Revenue generated from AI-related products hit RMB12.38 billion, experiencing triple-digit growth for the twelfth consecutive quarter.
Share Offering Reinforces Alibaba’s Commitment to AI
This recent capital raise complements Alibaba’s prior investment plan announced in February 2025. The firm pledged at least RMB380 billion to AI and cloud infrastructure over three years, surpassing its combined spending in these areas over the previous decade. Since then, Alibaba has continued expanding computing capacity while advancing its cloud services, AI models, and its internally developed semiconductor technology.
The increased investment has coincided with declining quarterly profits but accelerated growth in cloud revenue. For the June quarter, Alibaba reported a net income of RMB10.44 billion, which is a 75% decrease from the same period last year. The company also recorded a net outflow of RMB44.67 billion in free cash flow, mainly due to higher expenditures on cloud infrastructure. The HK$80 billion share placement provides Alibaba with additional capital specifically designated for its full-stack AI capabilities and infrastructure development.