The company will use proceeds to bolster AI infrastructure, following a 75% profit decline in its latest quarter due to heavy spending.
Alibaba’s stock fell as much as 10% in Hong Kong after announcing an $10.20 billion share placement to non-U.S. investors. The company priced 710 million new shares at HK$112.70, below Friday’s closing price of HK$123, with trading down 8.4% at last check.
The move follows a 75% drop in June-quarter profit as AI-related capital expenditure surged 75% to 67.7 billion yuan. Alibaba plans to invest at least 380 billion yuan in cloud and AI infrastructure over three years, aligning with broader industry trends.
The placement, set to close Wednesday, underscores Alibaba’s push to lead in AI despite near-term earnings pressure. Shares extended losses amid concerns over rising costs and execution risks.