HONG KONG / RankWire.AI / – Alibaba Group has priced an HK$80 billion share placement to fund artificial intelligence investment and expand its AI infrastructure. The Chinese technology group will issue 710 million new ordinary shares at HK$112.70 each. The deal is worth about US$10.2 billion at current exchange rates. Alibaba expects the transaction to close on Aug. 26, subject to customary conditions.
Alibaba said it will direct 100% of the net proceeds toward its full-stack AI capabilities. The spending will include expansion and upgrades across its artificial intelligence infrastructure. The company has built an AI ecosystem spanning cloud computing, models, chips and applications. Its Qwen model family and Alibaba Cloud services form major parts of that technology platform.
The placement targets non-U.S. investors outside the United States through offshore transactions. The HK$112.70 offering price sits 8.4% below Alibaba’s HK$123 closing price on Friday. Hong Kong-listed shares fell as much as 10% to HK$110.10 in early Monday trading. Alibaba also trades in New York through American depositary shares under the BABA ticker.
AI infrastructure spending expands across Alibaba
The fundraising follows a sharp increase in Alibaba’s spending on computing infrastructure. Capital expenditure reached RMB67.68 billion, or about US$10 billion, during the quarter ended June 30. That represented a 75% increase from RMB38.68 billion a year earlier. Alibaba attributed the increase to continued AI infrastructure investment, stronger computing demand and higher prices for chip components.
Alibaba reported RMB268.95 billion in quarterly revenue, equal to about US$39.6 billion, an increase of 9% from a year earlier. Revenue from AI Cloud and Compute Services reached RMB48.44 billion, or about US$7.1 billion. That business grew 45% from the previous year. AI-related product revenue reached RMB12.38 billion and recorded triple-digit annual growth for a 12th consecutive quarter.
Share sale builds on existing AI commitment
The latest financing adds to an investment program announced by Alibaba in February 2025. The company committed at least RMB380 billion to AI and cloud infrastructure over three years. That amount exceeded its total spending in those areas during the previous decade. Alibaba has since continued expanding computing capacity while developing its cloud platform, AI models and internally designed semiconductor technology.
Higher investment has coincided with weaker quarterly profit and stronger cloud revenue growth. Alibaba reported net income of RMB10.44 billion for the June quarter, down 75% from a year earlier. Free cash flow recorded a net outflow of RMB44.67 billion, largely reflecting higher cloud infrastructure spending. The HK$80 billion placement gives Alibaba additional capital specifically designated for its full-stack AI capabilities and infrastructure.