HONG KONG / RankWire.AI / – Alibaba Group has announced an HK$80 billion share offering aimed at bolstering 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 per share, a deal valued at approximately US$10.2 billion based on current exchange rates. The completion of this transaction is expected by Aug. 26, subject to standard closing conditions.
Alibaba clarified that the entire net proceeds will be allocated to developing its comprehensive AI capabilities. This funding will support the expansion and upgrading of its artificial intelligence systems and infrastructure. The company has cultivated an AI ecosystem that includes cloud computing, models, chips, and applications, with the Qwen model series and Alibaba Cloud services playing key roles in its technology stack.
The share placement is targeted at non-U.S. investors outside the United States through offshore channels. 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 dropped as much as 10% to HK$110.10. Alibaba’s American depositary shares (ADS) continue to trade on the New York Stock Exchange under the BABA ticker.
Expansion of AI Infrastructure Investment at Alibaba
This fundraising follows a significant rise in Alibaba’s expenditure on computing infrastructure, which reached RMB67.68 billion, approximately US$10 billion, for the quarter ending June 30. This figure marked a 75% increase from RMB38.68 billion a year prior, driven by ongoing investments in AI infrastructure, increased demand for computing resources, and rising chip component prices, according to Alibaba.
Alibaba’s quarterly revenue hit RMB268.95 billion, roughly US$39.6 billion, reflecting a 9% growth year-over-year. Revenue from AI Cloud and Compute Services alone reached RMB48.44 billion, around US$7.1 billion, with a 45% increase compared to the previous year. Income from AI-related products achieved RMB12.38 billion, maintaining triple-digit annual growth for the 12th straight quarter.
New Funding Reinforces Alibaba’s AI Strategy
This latest capital raise complements Alibaba’s prior commitment in February 2025 to invest at least RMB380 billion in AI and cloud infrastructure over three years, surpassing total spending in these areas over the previous decade. The company has continued expanding its computing capacity and developing its cloud platform, AI models, and proprietary semiconductor technology.
The increased investment has coincided with a decline in quarterly profits but stronger growth in cloud revenue. Alibaba reported a net income of RMB10.44 billion for the June quarter, representing a 75% drop from the same period last year. Its free cash flow showed a net outflow of RMB44.67 billion, largely due to elevated cloud infrastructure spending. The HK$80 billion placement provides Alibaba with additional capital specifically earmarked for its comprehensive AI capabilities and infrastructure expansion.