Alibaba chairman Joseph Tsai said the company would concentrate on expanding its cloud business and investing in its artificial intelligence (AI) drivers. Some analysts believe the reversal on the spin-off could benefit Alibaba's AI push. The company expressed concerns that the chip ban might significantly impact its ability to offer products and services in the long term, but also emphasized the growing importance of retaining the cloud unit due to the increasing demand for AI computing in China.
Key takeaways:
- Alibaba Group reported second-quarter revenue of $47.96 billion, which was in line with analysts' expectations.
- The company's share price fell by around 10% in early trading in Hong Kong after it revealed plans to shelve the spin-off and Hong Kong listing of its cloud services business.
- Alibaba's future strategy will be to focus on each of its subsidiaries facing the market more independently and conduct a strategic review to distinguish between “core” and “non-core” businesses.
- The company plans to focus on growing its cloud business and providing investment for its artificial intelligence (AI) drivers, which is seen as crucial given the surging demand for AI computing in China.