Alibaba Profit Drops 75 Percent on Heavy AI Spending
Alibaba reported a sharp drop in quarterly profit as it heavily increased spending on artificial intelligence infrastructure. The tech giant saw revenue rise nine percent driven by strong cloud demand.
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ALIBABA GROUP HOLDING LTD posted a 75% drop in quarterly net profit on Thursday, falling to 67.68 billion yuan as surging AI infrastructure investments weighed on earnings. The profit contraction followed a 9% rise in quarterly revenue, driven by robust demand for cloud computing and enterprise artificial intelligence services in China. The heavy capital outlay highlights the race among major technology firms to secure compute capacity for advanced AI models.
