Investors are wary of the Chinese company’s funding of AI infrastructure and chips

Alibaba stock dropped over 7% as investors digested heavy AI infrastructure spending and profit pressure, despite a 45% surge in AI Cloud revenue.

The Chinese tech giant is expanding beyond retail into chips, cloud and large language models as surging spending weighs on quarterly profits.

Alibaba aims to raise $10 billion through a share sale to enhance its artificial intelligence capabilities and compete globally.