Alibaba and Baidu stand to benefit because China will not slow its AI development even if the US slows its own. x.com 

Alibaba and Baidu are a no-brainer buy because Chinese AI stocks trade at very low valuations while China is determined to race the US in AI. x.com 

Alibaba is tough to hold because it is splitting investment between e-commerce and AI, creating massive execution risk. AI is so capex-hungry that, as Western examples show, Alibaba cannot spread spending and still reach comparable results. The market sees China e-commerce spending, including the quick-commerce race, as having no ROI, and is right. Replies argue Alibaba has no choice; it might still make it, but the risk is that its AI push slows. x.com  x.com  x.com 

Alibaba's 8.5% drop on its $10 billion discounted raise punishes the one thing that is working, its AI build-out. Bloomberg says the raise was three times oversubscribed, and the chairman and CEO bought $15 million of stock the same afternoon. Cloud revenue grew 45% last quarter, per Alibaba's June filing, AI product revenue has grown triple digits for twelve straight quarters, and its open model Qwen passed 3 billion downloads to become the most used AI. The dilution reaction ignores that. … Show more

Alibaba is a contrarian trade because accelerating demand for relatively cheaper compute is very underappreciated, and China's cloud market is still in its infancy versus the US. Alibaba is a consensus short as upside from closed-source AI looks illusory. x.com  x.com 

Alibaba's $10.2 billion Hong Kong share placement shows its cash burn has caught up with it, and more dilution is likely. Core China ecommerce makes roughly $30 billion of flat EBIT, half of it reinvested in quick commerce to defend share against PDD. Cloud and AI earns $2 billion of EBIT growing 35% but burns about $10 billion a year in AI-model opex. Pro forma EBIT of about $7 billion collapses after $20-25 billion of annual capex, so Alibaba will keep tapping equity markets. x.com 

Alibaba is the cleanest public-market bet that Chinese AI labs are innovating rather than just distilling, and that cheaper models drive more usage. If China is innovating, Qwen drives Alibaba Cloud share; if Jevons paradox holds, Alibaba captures the spend across models, compute, data, chips and apps. AI products are already 30% of Alibaba Cloud's external revenue, above a $5B run rate, and the commerce cash engine can carry it through the capex/revenue mismatch. x.com 

Alibaba offers opportunity at $123 as a front-runner in China's AI buildout, particularly if its AI spending shows real returns and it proves it can compete with the US. Over $56 billion of AI and cloud investment over three years has made current free cash flow negative, like US hyperscalers. Cloud growth is expected near 45%, AI products are already 30% of external cloud revenue, and it holds $38 billion of net cash. Cloud growth, capex and guidance will drive the earnings reaction. x.com 

Alibaba is no longer worth owning when better opportunities exist. The case for it as a China hedge was a macro feeling applied to a single company, and it ignored Jack Ma being yanked away and a lack of cloud growth while leaning on share buybacks and looking too cheap to ignore. Despite its discount to US companies, other stocks, such as GitLab and Airbnb, now look much more compelling. x.com 

Baidu looks ready for a second leg higher as President Trump meets President Xi this week. It has built a five-year base, holds $43B of cash, grew AI Cloud 34% year over year and has a Kunlunxin AI chip spin-off coming. x.com