Alibaba Shares Surge 18% on AI, Cloud Growth Amid Market Pressure

Alibaba's shares surged between 15% to over 18% following strong financial results driven by exceptional growth in its artificial intelligence (AI) and cloud computing businesses. The company reported a triple-digit increase in AI-related product revenue and a 26% rise in cloud division sales, signaling its solid positioning amid fierce competition with JD and Meituan in China's e-commerce and instant commerce sectors. Despite a modest overall revenue increase and some operating income declines, Alibaba's net profit beat expectations, fueled partly by equity investment gains and asset sales, while core e-commerce revenue grew 10%. Investors have responded positively to Alibaba's strategic focus on AI, including the development of a next-generation AI chip, which is viewed as key to maintaining long-term growth beyond traditional retail dominance. This AI-driven growth helped Alibaba's stock outperform peers amid a challenging environment marked by a damaging price war in food delivery and instant commerce, which has significantly impacted rivals' profitability. The company's emphasis on cloud growth over near-term margins and its expanding international e-commerce presence highlight its ambition to lead China's technological future.