Alibaba Steps Up AI Race With Potential Nvidia Mega Order
- - Alibaba Steps Up AI Race With Potential Nvidia Mega Order
Anusuya LahiriJanuary 12, 2026 at 5:01 AM
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Alibaba Group Holding Ltd. (NYSE:BABA) stock rose Thursday after reports signaled expanded access to Nvidia Corp.'s (NASDAQ:NVDA) advanced artificial intelligence chips in China.
The Chinese e-commerce giant pared some of those gains in early Friday trading, following a rally of more than 5% the prior session. The Thursday move came after reports that China may approve limited imports of Nvidia's H200 chips as soon as this quarter.
Nvidia is tightening its sales of H200 artificial intelligence chips to China as it works to reopen a critical market while managing geopolitical tensions between Washington and Beijing.
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The company now requires Chinese customers to pay in full upfront for H200 orders and to accept rigid, no-flexibility terms, Reuters reported.
Regulatory Signals From Beijing
At the same time, Chinese regulators are preparing to approve limited H200 imports as soon as this quarter for select commercial uses, while restricting access for the military, sensitive government agencies, and state-owned enterprises, according to Bloomberg.
Officials have also asked some Chinese technology firms to temporarily pause orders and are considering requirements that buyers purchase domestically made chips alongside Nvidia products.
Against that backdrop, Alibaba has privately told Nvidia that it is interested in ordering more than 200,000 units of the H200, Bloomberg reported on Friday, citing a source familiar with the matter.
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Analyst Commentary
Investors responded to expectations that China will allow domestic companies to use Nvidia's H200 chips, a development that would support firms such as Alibaba, Vey-Sern Ling, managing director at Union Bancaire Privee, told Bloomberg on Friday.
The H200 is an older-generation chip that the Trump administration has said can be exported to China amid escalating geopolitical tensions between the countries.
Alibaba has emerged as the largest AI spender among Chinese technology companies, and a more reliable chip supply would strengthen its cloud business.
The stock gained 92% over the last 12 months, driven by strong investor confidence in its substantial investments and growth in AI, particularly in its cloud computing division.
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