Alibaba’s Hong Kong-listed shares surged more than 19% on Monday, reaching their highest level since March, as strong results from its cloud computing division and reports of a new AI chip reignited investor enthusiasm for the Chinese tech powerhouse. The rally extended the momentum from Friday, when Alibaba’s New York-listed shares closed nearly 13% higher following the release of its latest earnings.
For the June quarter, Alibaba reported revenue of 247.65 billion Chinese yuan ($34.73 billion), a modest 2% increase year-on-year that came in below analyst forecasts. However, the company delivered a far stronger performance on the bottom line, with net income soaring 78% compared to last year, well ahead of expectations. The standout performer was its cloud computing business, which recorded a 26% annual jump in revenue, accelerating from the prior quarter and underscoring the division’s role as a critical growth driver.
Like many of its Chinese and U.S. peers, Alibaba has been doubling down on artificial intelligence. The company is building its own AI infrastructure, training models, and monetizing AI services through its cloud platform, a strategy similar to that of Microsoft and Google. AI-related product revenue grew at a triple-digit pace year-over-year for the eighth straight quarter, cementing the cloud unit’s position as the centerpiece of Alibaba’s future growth story. Adding fuel to the stock rally, CNBC reported that Alibaba is developing a new AI chip, a move seen as strengthening its competitive edge in the rapidly evolving AI market.
Beyond cloud and AI, Alibaba’s core e-commerce business is showing fresh signs of recovery, with investors encouraged by its renewed momentum. The company has also ventured into China’s intensely competitive “instant commerce” sector, rolling out a one-hour delivery service through its flagship Taobao app earlier this year. While these investments have weighed on adjusted earnings for its e-commerce arm, investors appear willing to give the company room to expand into this fast-growing area.
Overall, the latest surge in Alibaba’s share price reflects renewed investor confidence in its ability to innovate, scale new technologies, and regain lost ground in the Chinese tech sector. With accelerating cloud growth, a bold push into AI, and strategic bets in next-generation commerce, Alibaba is once again reminding markets of its ability to pivot and compete at the highest level.
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