Chinese internet giant Alibaba is seeing rapid revenue growth thanks to a surge in AI spending by Chinese companies. The company’s financial report shows that revenue increased 8% in the fourth quarter of 2024, reaching 280 billion yuan ($38 billion). Alibaba intends to continue to invest heavily in AI.
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The positive momentum was driven by Alibaba’s cloud revenue growth of 13% to 31.7 billion yuan, which sent Alibaba’s shares up 9% in pre-market trading in the U.S. The company’s shares have risen more than 50% since the start of the year, as Alibaba has benefited from the AI boom following the success of DeepSeek and its partnership with Apple to launch Apple Intelligence in China.
«Looking ahead, AI-driven revenue growth for Cloud Intelligence Group will continue to accelerate. We will continue to execute on our strategic priorities in e-commerce and cloud computing,” said Eddie Wu, head of Alibaba’s cloud business.
Alibaba also said the company will invest “aggressively” in artificial intelligence over the next three years as it seeks to capitalize on the rapidly evolving technology. Wu said the company’s main goal is to achieve general-purpose artificial intelligence, which is AI that can think like a human. Alibaba said it will soon launch a model capable of deep reasoning, which will allow it to compete with the latest models from DeepSeek and OpenAI, which have the ability to reason to solve complex problems.
Revenue at Alibaba International Digital Commerce Group rose 32 percent to 37.8 billion yuan ($5.1 billion), driven by gains from its AliExpress platform. The company’s China commerce business grew 5 percent to 136 billion yuan ($18.6 billion) in the fourth quarter.
At the same time, Alibaba continues to invest heavily in Chinese AI startups like Moonshot and 01.ai to leverage their AI expertise and gain a technical advantage over competitors like Baidu and ByteDance. Over the past 18 months, Alibaba has released several AI models in an attempt to strengthen its position in the cloud by attracting developers to its platform.