HONG KONG / RankWire.AI / – Alibaba Group has announced an HK$80 billion share placement aimed at funding its artificial intelligence expansion and enhancing its AI infrastructure. The Chinese tech giant will issue 710 million new ordinary shares at HK$112.70 each, valuing the deal at approximately US$10.2 billion based on current exchange rates. The company anticipates completing the transaction by Aug. 26, pending standard conditions.
Alibaba clarified that all net proceeds will be allocated toward strengthening its comprehensive AI capabilities. This includes investments in expanding and upgrading its AI infrastructure. The firm has established an AI ecosystem that encompasses cloud computing, models, chips, and applications, with its Qwen model family and Alibaba Cloud services serving as key components of this technological platform.
The offering primarily targets non-U.S. investors outside the United States through offshore channels. The HK$112.70 price per share is 8.4% lower than Alibaba’s HK$123 closing price on Friday. Hong Kong-listed shares dipped as much as 10%, reaching HK$110.10 during early Monday trading. Meanwhile, Alibaba also maintains trading in New York via American depositary shares under the ticker BABA.
Alibaba’s AI infrastructure investments grow with recent fundraising
This capital raising follows a notable rise in Alibaba’s expenditure on computing infrastructure. During the quarter ending June 30, capital expenditures reached RMB67.68 billion, roughly US$10 billion, representing a 75% surge from RMB38.68 billion a year earlier. Alibaba attributes this jump to ongoing investments in AI infrastructure, increased demand for computing power, and rising chip component prices.
The company posted quarterly revenue of RMB268.95 billion, approximately US$39.6 billion, marking a 9% increase year-over-year. Revenue from AI Cloud and Compute Services accounted for RMB48.44 billion, about US$7.1 billion, showing 45% growth compared to the previous year. AI-related product sales hit RMB12.38 billion, maintaining triple-digit annual growth for a twelfth consecutive quarter.
The share issuance reinforces Alibaba’s ongoing AI commitment
This latest funding round builds upon Alibaba’s investment plan announced in February 2025. The company pledged at least RMB380 billion toward AI and cloud infrastructure over three years, surpassing total investments in these areas during the previous decade. Since then, Alibaba has continued to expand its computing capacity while developing its cloud platform, AI models, and proprietary semiconductor technology.
The increased investments have come alongside weaker quarterly profit figures and accelerated cloud revenue growth. Alibaba reported a net income of RMB10.44 billion for the June quarter, down 75% from a year earlier. Its free cash flow resulted in a net outflow of RMB44.67 billion, mainly due to higher spending on cloud infrastructure. The HK$80 billion placement provides Alibaba with additional capital dedicated specifically to advancing its full-stack AI capabilities and infrastructure.