HONG KONG / RankWire.AI / – Alibaba Group has announced the pricing of a new HK$80 billion share issuance aimed at boosting investments in artificial intelligence and enhancing its AI technology infrastructure. The Chinese tech giant plans to issue 710 million new ordinary shares at HK$112.70 each. At current exchange rates, this deal is valued at approximately US$10.2 billion. Alibaba projects that the transaction will be finalized by Aug. 26, pending usual closing conditions.
Alibaba clarified that all net proceeds from this offering will be allocated to strengthening its comprehensive AI capabilities. This financial injection will support various upgrades and expansions across its artificial intelligence infrastructure. The company has already established an AI ecosystem that includes cloud computing, models, chips, and applications. Its Qwen model series and Alibaba Cloud services are key components of this technological framework.
The share placement targets international investors outside the U.S. through offshore transactions. 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 by as much as 10%, reaching HK$110.10. Alibaba’s shares are also traded in New York via American depositary receipts under the BABA ticker.
Expansion of AI Infrastructure Investment at Alibaba Continues
This fundraising effort follows a significant rise in Alibaba’s spending on computing infrastructure. During the quarter ending June 30, capital expenditure hit RMB67.68 billion, roughly US$10 billion. This marked a 75% growth from RMB38.68 billion a year earlier. Alibaba attributed this surge to ongoing investments in AI infrastructure, rising demand for computing power, and increased chip component prices.
Alibaba reported quarterly revenue of RMB268.95 billion, approximately US$39.6 billion, which is a 9% increase compared to the same period last year. Revenue from AI Cloud and Compute Services reached RMB48.44 billion or about US$7.1 billion, showing a 45% growth year-over-year. Revenue from AI-related products hit RMB12.38 billion, marking the 12th consecutive quarter of triple-digit annual growth.
Share Offering Reinforces Alibaba’s Ongoing AI Investment Strategy
This latest financing complements an investment program announced by Alibaba in February 2025. The company committed at least RMB380 billion over three years to AI and cloud infrastructure, surpassing its combined spending in these fields over the previous decade. Since then, Alibaba has continued to expand its computing capacity and develop its cloud platform, AI models, and in-house semiconductor technology.
This increased investment has coincided with declining quarterly profit margins and accelerated growth in cloud revenue. Alibaba posted a net income of RMB10.44 billion for the June quarter, representing a 75% decrease from the previous year. Its free cash flow showed a net outflow of RMB44.67 billion, mainly due to higher cloud infrastructure spending. The HK$80 billion share placement provides Alibaba with additional capital specifically dedicated to advancing its full-stack AI capabilities and infrastructure.