HONG KONG / RankWire.AI / – Alibaba Group has announced an HK$80 billion share placement aimed at boosting its investments in artificial intelligence and enhancing its AI infrastructure. The Chinese tech giant plans to 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 expects the transaction to finalize by Aug. 26, contingent upon standard closing conditions.
Alibaba stated that the entire net proceeds from this offering will be allocated to its comprehensive AI capabilities. The funds will support the expansion and upgrading of its artificial intelligence infrastructure. The firm has developed an AI ecosystem that covers cloud computing, models, chips, and applications. Key components of this platform include its Qwen model family and Alibaba Cloud services.
The placement is targeted at non-U.S. investors outside the United States through offshore channels. The HK$112.70 per share offering price is 8.4% lower than Alibaba’s HK$123 closing price on Friday. Following this, Hong Kong-listed shares dropped as much as 10% to HK$110.10 in early Monday trading. Alibaba also operates in New York through American depositary shares under the BABA ticker.
Broadening AI Infrastructure Investment at Alibaba
This fundraising coincides with a notable surge in Alibaba’s expenditure on computing infrastructure. During the quarter ending June 30, the company’s capital expenditure hit RMB67.68 billion, roughly US$10 billion, marking a 75% rise from RMB38.68 billion a year prior. Alibaba attributed this growth to ongoing investments in AI infrastructure, increased demand for computing resources, and rising chip component prices.
Alibaba’s quarterly revenue was RMB268.95 billion, approximately US$39.6 billion, reflecting a 9% increase year-over-year. Revenue from AI Cloud and Compute Services reached RMB48.44 billion, or about US$7.1 billion, with a 45% growth rate compared to the previous year. Revenue from AI-related products totaled RMB12.38 billion, achieving triple-digit annual growth for a twelfth consecutive quarter.
The New Share Offering Reinforces Alibaba’s AI Commitment
This recent fundraising initiative builds upon an investment plan that Alibaba announced in February 2025. The company pledged a minimum of RMB380 billion for AI and cloud infrastructure over a three-year period, surpassing its total spending in these fields over the previous decade. Alibaba has continued to expand its computing capacity while developing its cloud platform, AI models, and in-house semiconductor technology.
The heightened investment aligns with weaker quarterly profit margins but stronger growth in cloud revenue. Alibaba reported a net income of RMB10.44 billion for the June quarter, down 75% from the same period last year. Its free cash flow showed a net outflow of RMB44.67 billion, primarily due to increased spending on cloud infrastructure. The HK$80 billion share placement provides Alibaba with additional capital specifically earmarked for its comprehensive AI development and infrastructure expansion.