Alibaba Stock Slumps in Hong Kong After $10.2 Billion Share Placement to Fund AI
Alibaba said it will use the proceeds to expand AI infrastructure after profit fell 75% in the June quarter, weighing on shares.
- On Monday, Alibaba shares plunged as much as 10% in Hong Kong after the company priced an 80 billion Hong Kong dollar placement of newly issued shares.
- The share placement, expected to close Wednesday, follows a 75% profit drop for the June-quarter as capital expenditure on AI infrastructure weighed on recent results.
- Alibaba plans to use all net proceeds to expand its full-stack AI capabilities, building on its commitment to invest 380 billion yuan in cloud and AI infrastructure over three years.
- Vey-Sern Ling, senior equity advisor at UBP, told CNBC last week that Alibaba is "well positioned to chase that growth," citing its cloud computing arm and strong AI model.
- Chinese tech peers are also ramping up infrastructure spending, with Tencent reporting capital expenditure rose 65% to 52.8 billion yuan in the June-quarter to monetize AI models.
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49 Articles
Alibaba raises US$10 billion in record Hong Kong share sale
Alibaba Group Holding Ltd (阿里巴巴) raised HK$80 billion (US$10.2 billion) in Hong Kong’s biggest follow-on offering, underscoring its willingness to amass and spend vast sums to take the lead in global artificial intelligence (AI).The online retail giant-turned-AI player sold 710 million shares at HK$
Alibaba raises $10 billion to keep up in the AI race
Chinese tech giant Alibaba raised $10 billion in Hong Kong’s biggest-ever secondary share sale in order to keep up in the global AI race. However, some traders appeared unconvinced by the company’s plans, with its stock tanking almost 10% in trading on Monday, its steepest single-day drop in more than a year. Investors worldwide fret that tech firms’ revenues are struggling to keep up with the AI spending spree, which has added substantially to …
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