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Alibaba’s cloud growth comes with a rising AI bill
Faster cloud growth is being accompanied by mounting pressure on earnings and cash flow from AI infrastructure spending.
4 mins read
Cloud Solutions
The Chinese tech giant said it spent a record amount on R&D in 2025.
Heavy spending on commerce weighed on its margins and cash flow.
Strong results were offset by higher expenses and a warning of increased spending in 2026.
Depending on the metric, each player can claim the lead, but the truer test may be how many customers stay and pay.
The tech giant’s “unified global cloud network” aims to support Chinese firms in expanding abroad and tapping into advanced tech, particularly AI.
Steady performance in commerce and strong growth in AI-driven cloud services lifted Alibaba’s profit, though an EPS shortfall tempered investor sentiment.
Chen Hang returns as CEO of DingTalk following a stint at the startup HHO.
Recent price cuts by Chinese AI players, including Alibaba Cloud, are pushing LLM prices to historic lows.