Alibaba Results Likely to Show Limited AI Payoff for China Tech: Reuters

Alibaba is expected to highlight its artificial intelligence (AI) strategy in its quarterly results, but like peers Tencent and Baidu, it may struggle to demonstrate significant returns from its AI investments, Reuters reporters Liam Mo and Brenda Goh wrote.

Alibaba has been among the most aggressive in China’s AI race, rolling out advancements almost weekly. (Photo: Freightclear)

The companies have poured billions into AI over the past three years following the global success of ChatGPT, touting it as a key growth driver.

They launched their own large language models and integrated them into flagship products. But monetization has proven difficult, as Chinese users—unlike Western customers—have shown strong resistance to paid subscription models, analysts noted.

Alibaba has been among the most aggressive in China’s AI race, rolling out advancements almost weekly.

Still, weak contributions from its AI push weigh on its growth outlook at a time when its core e-commerce business is locked in fierce price competition amid China’s persistent economic slowdown.

Analysts estimate revenue from Alibaba’s cloud division, which includes AI-related product sales, grew just 4.3% in the April–June quarter from the previous quarter, to 31.4 billion yuan ($4.4 billion), according to LSEG data.

That would mark an 18% year-on-year increase but suggests growth is decelerating.