Alibaba raises $10.2 billion in Hong Kong share sale, stock drops 10%
What's new: The proceeds are earmarked for AI infrastructure, and the deal came after quarterly profit fell 75% as spending surged.
Alibaba raised HK$80 billion, or about $10.2 billion, in a Hong Kong share placement and saw its stock fall as much as 10% on Monday after pricing the deal at a discount. The Chinese tech group sold 710 million new shares at HK$112.70 each, versus Friday’s close of HK$123, with the offering set to close Wednesday. Alibaba said it will use the net proceeds to expand its full-stack AI capabilities, including infrastructure. The fundraising follows a sharp jump in capital spending and comes days after the company reported a 75% drop in June-quarter profit as AI investment weighed on results. Alibaba last year committed to invest at least 380 billion yuan in cloud computing and AI infrastructure over three years.