On August 28, 2024, the Alibaba office building is located in Nanjing, Jiangsu Province, China.
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Alibaba Shares rose on Wednesday after China’s state media reported that the e-commerce giant had secured key customers for its artificial intelligence chips.
According to a report from China State Broadcasting Station CCTV, China Unicom will deploy Alibaba’s AI accelerators from semiconductor units called Pingtouge or T-Head. Although Alibaba does not sell chips directly, companies can effectively use their computing power based on these semiconductors by purchasing Alibaba Cloud services.
Those familiar with the issue have approved the accuracy of the CCTV report to CNBC.
When contacted by CNBC, Alibaba could not immediately comment.
Alibaba shares closed more than 5% in Hong Kong, and its US-listed stocks rose more than 2% in pre-market trade.
Alibaba’s computing power will be used by China Unicom, the country’s second largest telecommunications company, as part of a large new data center project in China, which also includes chips from other domestic companies such as Metax and Biren Technology.
The move highlights China’s efforts to boost its use of its domestic semiconductors for AI when Nvidia is in a state of fluid access to the world’s second-largest economy.
On Wednesday, the Financial Times reported that China’s internet regulator, China’s cyberspace management, had directed businesses to suspend the purchase of certain Nvidia AI chips. Nvidia’s shares were about 1% lower in pre-market trading.
Alibaba is one of China’s leading AI players. It develops its own AI model and is one of the largest cloud computing players locally. At the same time, it is developing a brand new AI chip, CNBC reported last month.
It is unclear if China Unicom uses Alibaba’s latest chips. Information about the partnership between the two companies has emerged after CCTV presented a sign with details as part of a report for Aono’s new Sanjiangyuan data center in Aono major Aoshima.
