Shares jumped 4.2% to ARS 21,010 after Alibaba unveiled what it calls the world's second-most-powerful AI system at the World Artificial Intelligence Conference in Shanghai — a bold claim that landed with no independent evidence to back it up, and investors must now decide whether ambition alone justifies the premium.
The Biggest Claim Has No Scoreboard
Alibaba previewed its new flagship AI model on July 19 at Shanghai's WAIC, touting a 2.4-trillion-parameter system it says is "second only to Fable 5" among the world's leading AI models. But here's the catch: Alibaba published no benchmark table or model card alongside it — the ranking is the company's own.
No independent testing body has scored the model; every performance claim so far comes from Alibaba's internal evaluations. For shareholders riding a +8% swing from the July 13 close of ARS 19,530, the gap between marketing and verification is the single biggest risk to the current rally.
The AI Cloud Business Is Real — and Expensive The excitement isn't baseless. AI-related product revenue delivered triple-digit year-over-year growth for the eleventh consecutive quarter and hit an annualized run rate of roughly US$5.2 billion.
Full-year cloud revenue rose 34% to US$22.9 billion. But that growth devours cash: fiscal 2026 free cash flow swung to a negative US$6.8 billion from a positive US$10.7 billion a year earlier , largely because of cloud and AI infrastructure spending. Every impressive new model deepens the capital hole before it generates returns.
Rivals Aren't Waiting
The timing of Alibaba's reveal — days after Chinese rival Moonshot released its own competing open-weight model — suggests a direct competitive response.
Moonshot is pursuing a Hong Kong IPO that sources say could value it above $30 billion. Alibaba needs to prove its cloud platform can convert frontier-model headlines into paying enterprise customers faster than well-funded startups.
What Investors Should Watch Next
The full model is scheduled to launch with open weights, though no date, license, or independent benchmarks have been published.
CEO Eddie Wu has outlined an ambitious $100 billion five-year external cloud and AI revenue target — meaning today's $23 billion cloud business must more than quadruple. Until third-party scores and real pricing arrive, today's rally is trading on a promise, not a product.