Chinese regulators have granted in-principle approval for Alibaba to advance preparations to purchase Nvidia H200 AI chips, marking a significant shift after weeks of import uncertainty. The company is cleared to negotiate order quantities and has indicated private interest in securing over 200,000 units. Beijing will require a minimum domestic chip purchase as a condition for final approval, though exact quotas remain unspecified. This move opens the door to substantial AI infrastructure investment by Alibaba and aligns with government efforts to balance advanced foreign technology with local semiconductor development.

Alibaba is reportedly planning to carve out its T-Head chipmaking division into a standalone entity with partial employee ownership ahead of an initial public offering. The restructuring aims to capitalize on high valuations in China’s AI accelerator market and mirror similar moves by domestic peers. Executives believe unlocking T-Head’s intrinsic value could raise several billion dollars, funding further R&D and positioning the unit to compete more directly with established AI chip providers.

Following a benchmark research house upgrade from neutral to buy, Alibaba shares jumped over 5% in a single session, with intraday trading volume rising 81% above its three-month average. This bullish reassessment reflects growing confidence in the company’s AI strategy, spinoff plans and core e-commerce growth. Market consensus now skews heavily positive, with more than 85% of covering analysts recommending a buy or outperform stance.

Several major funds have increased their Alibaba holdings in recent quarters, signaling institutional support for the company’s strategic pivot. Verde Servicos Internacionais raised its stake by 6.9% to 67,773 shares, while NTV Asset Management more than doubled its position, up 127.4% to 15,143 shares. Y Intercept Hong Kong amplified its exposure by 197%, reaching 34,225 shares. Institutional ownership now accounts for 13.47% of outstanding shares, underlining growing confidence in Alibaba’s long-term growth trajectory.