Alibaba to Invest Over 380 Billion CNY ($55 Billion) in Cloud and AI Infrastructure

On February 24,  #Alibaba's CEO Wu Yongming announced that the company will invest over 380 billion CNY ($55 billion) in cloud and AI infrastructure over the next three years. This investment is larger than the total of the past decade’s infrastructure spending, marking a record for private Chinese companies.

 

This move follows the rapid growth of China’s AI industry and a recent private sector forum. Wu emphasized, "The AI boom has exceeded expectations, and Alibaba will accelerate the development of cloud and AI infrastructure to support the entire industry."

Morgan Stanley raised Alibaba's target price from $100 to $180, predicting Alibaba Cloud’s revenue will double by 2028. Goldman Sachs also upgraded their target price to $160 due to strong cloud growth and capital investments that are benefiting the data center industry.

In its third-quarter results, Alibaba reported 318 billion CNY ($46 billion) in capital expenditures, primarily for expanding cloud infrastructure and R&D. Wu stated that the next three years will be the most intense period for cloud infrastructure development in Alibaba's history, with these investments expected to be quickly absorbed by customer demand.

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