Alibaba’s stock surged nearly 4.8% following reports that China has authorized the import of Nvidia’s H200 AI chips in the current quarter. This development has intensified excitement among technology investors about a potential rejuvenation of AI initiatives in China. The surge marks Alibaba’s largest daily percentage gain since November, with Hong Kong-traded shares rising to 4.8%, driven by the promise of accessing Hopper-generation chips that offer six times the performance of the existing limited H20 produced by Nvidia.
As of January 9, Alibaba’s shares closed slightly lower at $150.95 on the NYSE, reflecting some price profit-taking. However, by January 10, shares rebounded to approximately $151.57, although they remain about 20% below their October levels, amid ongoing pressures in the e-commerce sector.
Beijing’s approval aligns with the partial commercial import permits granted during the Trump administration, which were conditional upon upfront payments and domestic chip quotas. According to reports from Reuters, Nvidia is requiring full upfront payments from Chinese clients for its H200 AI chips, as the company navigates the challenges of obtaining necessary approvals for shipments. This demand has skyrocketed, with Chinese companies placing over 2 million orders for the H200s—far exceeding Nvidia’s current inventory of 700,000 units. Major players like Alibaba and ByteDance are each targeting orders of over 200,000 units to enhance their AI models, looking to compete with offerings from OpenAI.
Alibaba, recognized as a leading investor in AI technology, has posted a 34% growth in cloud revenue during the previous quarter, bolstered by its active spending in the sector. Analysts believe that access to the H200 chips could accelerate Alibaba’s development efforts, helping to close the technological gap with U.S. firms, despite ongoing challenges regarding domestic self-sufficiency initiatives. However, potential risks linger, including Beijing’s final regulatory mandates, military limitations, and Nvidia’s pivot towards its Blackwell chip technology, which could constrain volume availability.
This pivotal development in AI chip access is particularly significant for Alibaba’s ambitions in the cloud computing realm, as it could provide essential computing capabilities necessary for growth into 2026 and beyond. As the market watches these developments unfold, Alibaba stands at the forefront of the ongoing AI revolution in China, potentially reshaping the competitive landscape in the technology sector.
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