Alibaba has been making the headlines yet again and this time its for not just being a dominant force in e-commerce, but also as a serious innovator in AI. After a few years of uncertainty, the company has now positioned itself for a major comeback and a place in the leaderboard. Analysts are seeing a potential of 74% upside in its stock value. All of the evidence that you need regarding this can be found if you look at what Alibaba is doing across AI, logistics, and global expansion.
E-Commerce Is Still Alibaba’s Core, but It’s Way Smarter Now
As reported by Trading News, Alibaba’s core business are from platforms like Taobao and Tmall, and these have still remained strong. Even in this slow economy, Alibaba has seen 1.4% year-over-year growth in Q2 2025. This might not sound like a huge deal, but it actually is. It is hard to find and maintain stability in the middle of China’s economic headwinds. But, Alibaba has successfully done that and that speaks volumes.
Additionally, they’re also adding more firepower. The integration of WeChat Pay and tools like Quanzhantui, which is an AI-powered marketing assistant, has helped significantly in boosting sales. All of this during China’s biggest shopping festival, that is Singles’ Day.
Logistics Is Where Alibaba Quietly Wins
Alibaba’s Cainiao Network has been doing all the heavy lifting, quite literally. The company has recently launched freight corridor from Ningbo to Bangkok. The same has helped in cutting shipping costs from $2.60/kg to just $1.40/kg! That’s a big game-changer for merchants who require and need faster and at the same time cheaper delivery in Southeast Asia. It’s not flashy or something that you’d look for at first. But, this logistics backbone makes global e-commerce work. And even Alibaba knows it.
The True Growth Engines Are AI and the Cloud
Now, let’s move on to the fascinating topic of artificial intelligence. Alibaba’s cloud division has successfully generated over $4.2 billion in revenue.
Furthermore, to help developers in creating more intelligent apps, they have recently released Qwen2.5 Coder, which is a massive AI model with 72 billion parameters. Alibaba’s wish and desire to compete with companies like OpenAI, Google, and Anthropic is pretty evident from this.
In order to make this happen, Alibaba has spent more than $7 billion on AI infrastructure, including developer incentive programs and specialized chips. This proves that it’s not just an ambition but a long term strategy.
The Cost of AI Training Has Dropped, and That’s Significant
Alibaba’s ability to significantly reduce the cost of training AI models has proven to be one among its most remarkable accomplishments. Its most recent project, QwQ-32B, outperforms competing models like DeepSeek R1 in terms of both cost and performance.
Furthermore, instead of just depending on pricey APIs, they are also employing a method called ZeroSearch, which teaches AI to mimic web searches. And, this approach has resulted in an 88% reduction in training expenses.
It is quite admirable that Alibaba is innovating to make things smarter and more affordable rather than merely investing in the AI race. They are making AI more accessible, promoting international developer collaboration, and open-sourcing models.
What Could Go Wrong?
It goes without saying that there are risks. Right now China’s in an economic slowdown with high levels of debt and excessive competition from JD.com, PDD, and Temu, all of which coulsd slow down it’s growth. Nevertheless, Alibaba’s international push and its strategic bets on cloud and AI give it a cushion.
Alibaba Is Proving That Its More Than Just a Retail Giant
Alibaba has been continuously evolving, that too in real good speed. The days were it was a mere retail commerce company are now behind and it is actively proving to be an AI Powerhouse. The company has adopted smart cost-cutting measures in AI, and has expanded into new markets, and has continued cloud dominance. All of this suggest big things ahead.
