Alibaba’s shares soared more than seven percent in Hong Kong trading on Thursday after the Chinese tech giant introduced a new artificial intelligence model, QwQ-32B, which it claims can compete with DeepSeek—this year’s surprise AI breakout.
Investor enthusiasm around China’s AI sector has surged since January, following DeepSeek’s release of a cutting-edge chatbot at a significantly lower cost than its Western counterparts.
Alibaba asserts that its latest AI model, unveiled Thursday morning, delivers “comparable performance” to DeepSeek while requiring significantly less data to operate.
The e-commerce giant’s stock jumped more than seven percent before a midday trading pause at the Hong Kong Stock Exchange, reflecting renewed market confidence in China’s tech industry.
Alibaba’s resurgence follows co-founder Jack Ma’s reappearance in the public eye last month when he attended a high-profile business symposium with Chinese President Xi Jinping. Ma had largely stayed out of the spotlight since late 2020, when his criticism of government regulations preceded Beijing’s abrupt halt of Alibaba’s anticipated blockbuster IPO. A subsequent regulatory crackdown wiped out over a trillion dollars in market value from China’s major tech firms.
However, Ma’s participation in the recent meeting signaled a potential thaw in his relationship with regulators, aligning with Beijing’s efforts to revitalize the country’s sluggish economy.
The arrival of DeepSeek has further energized China’s AI race, with Alibaba’s QwQ-32B now competing against another emerging rival—Tencent’s Yuanbao.
In a potential boost for Alibaba, the Chinese government pledged on Wednesday to strengthen support for consumer spending, which has remained weak since the COVID-19 pandemic.
The Hangzhou-based company, which operates some of China’s largest online shopping platforms, announced last month that it plans to invest over $50 billion in AI and cloud computing over the next three years.