The actions of the e -commerce giant Alibaba (), listed in Nasdaqthey are in a recovery trajectory after a constant devaluation period that began in 2020. The papers have already valued more than 50% in 2025, in a rally that hit the mark of $ 100 billion, according to a report by CNBC.
The turnaround is very credited to the recovery of the image of Jack atco -founder of the company, with the Chinese government, after several clashes about what it considered an excess of regulations. And it was already expected: last year, an article published by Baron’s Albaba was already about 9 shares to buy in 2025.
The text said that the Chinese giant could well be the cheapest investment in e-commerce and cloud computing in the world. At the time, the action was about $ 89; Now it is negotiated around the $ 130.
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In a recent report, 16 Wall Street analysts set a target price of $ 165.61 for stocks, with estimates ranging from $ 140 to $ 190-suggesting a potential of 22%.
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Below are some important points to consider in this recovery:
A remain
The problems began around October 2020, when Jack Ma made strong comments directed to China’s financial regulator. Its group was at its height, accelerating its internationalization, illustrated by the initial public offering (IPO) Ant Groupfinancial technology company behind He isY, one of the most commonly used mobile payment systems by Chinese. But the IPO that would raise more than $ 34 billion in Shanghai and Hong Kong was canceled two days before the list, exactly by the alleged problems in the Chinese regulatory environment. Jack Ma entered the government’s sights exactly when Covid-19 pandemic reached its maximum point and competition, such as PindoDoo (Temu) began to bother his company.
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Remodeling
In March 2023, Alibaba bet on trying to gain more agility and made the decision to split into six separate business groups, each with the ability to raise external financing and even open capital. Following, the CEO and President Daniel Zhang It had its role shrunk to take care of the cloud computing business, being definitely removed three months later. The young Eddie Wu became CEO and Joe Tsaianother co -founder of the company, assumed the role of president. Under this new command, artificial intelligence became at the center of the bets.
And Alibaba began to adopt a “startup mentality” to follow the competition. Tsai said he and Wu decided that the first thing they needed to do was “simplify the company.” “Instead of talking about Alibaba as six different business units, we talk about ourselves as having two main businesses – e -commerce and cloud computing,” Tsai said in an interview.
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Jack Ma left the spotlight after becoming very vocal, to the point of being considered a poster boy against the excess of government control over the power of private companies and entrepreneurs. But his departure coincided with the fall in the value of technology companies and slowly began a rapprochement, as the government reduced pressure as the economy was losing strength after the pandemic. The president Xi Jinping He started to publicly encourage entrepreneurs and even held a recent meeting with them, a meeting that was attended by Jack Ma. Alibaba felt safe enough to announce an investment of more than $ 50 billion in AI infrastructure in the next three years.
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Artificial intelligence
It is at this point of advancement in AI projects that are the largest growth bets in Alibaba with investors. The theme was very driven by the euphoria around the DeepSeekwho turned their eyes from everyone in the global markets for the giants of technology in China. THE CNBC remembers that Alibaba is among the leaders in this field that, still in 2023, shortly after the ChatGPTthe company launched its first AI model called Tongyi Qianwen, or Qwen.
The Hangzhou -based company has advanced in releases that allow tasks such as generation of video, text and image from user prompts. And Alibaba has made its open source models, that is, anyone can download and develop them. Alibaba is also deepening its AI impulse, using Huawei domestic chips and its semiconductor division to reduce AI development costs by 20%.
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And the profits?
Alibaba reported a net profit of 48.9 billion yuans (US $ 6.7 billion) in the 4th quarter of 2024, exceeding 40.6 billion yuan profit projections and far exceeding 14.4 billion yuans from the previous year. Revenue added 280.2 billion yuans (about $ 38 billion), slightly surpassing estimates. THE Cloud Intelligence Group From Alibaba reported an increase in revenue of 13% year by year to 31.7 billion yuans (US $ 4.3 billion), driven exactly by AI -related growth. CEO Eddie Wu emphasized this aggressive expansion in the company’s AI, noting that planned investments in cloud and AI infrastructure over the next three years will overcome the spending of the last decade.
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(Com CNBC, Barron’s, Asia Tech Review e CCN.com)
