Alibaba Cloud Intelligence Group plans to fully spin off and introduce external investors for its second venture in the future

According to news on May 19, Alibaba Group plans to fully spin off its subsidiary Alibaba Cloud Intelligence Group and list it in the next 12 months. This decision is to better develop Alibaba Cloud Intelligence Group so that it can independently face the market, optimize business strategies and organizational operations, and at the same time attract capital injections from external strategic investors.

It is understood that Alibaba Cloud Intelligence Group’s business model, customer characteristics and development stage are significantly different from Alibaba Group’s consumer Internet business, so the spin-off is to better meet the needs of Alibaba Cloud Intelligence Group. This also means that Alibaba Cloud Intelligence Group will form a new company that is completely independent from Alibaba Group, with independent equity and corporate governance structures.

Zhang Yong, chairman and CEO of Alibaba Group and chairman and CEO of Alibaba Cloud Intelligence Group, said in a letter to all employees that the spin-off will open a new chapter for Alibaba Cloud Intelligence Group’s second entrepreneurship. He encouraged the Alibaba Cloud Intelligence team to cherish the trust of customers, adhere to technological ideals, maintain an entrepreneurial mentality, and believe in their ability to build a world-class technology company.

Zhang Yong also expressed his confidence in the future development of Alibaba Cloud during the financial report conference call. He pointed out that the advent of the intelligent era has brought two historical opportunities to Alibaba Cloud. First, the widespread application of large artificial intelligence models and various industry/exclusive models has put forward new requirements for computing power. Alibaba Cloud, with its leading public cloud infrastructure and high-performance computing power services, can meet the needs of enterprises and entrepreneurs. Model development needs. Secondly, Alibaba Cloud is forming a new model as a service (MaaS) based on infrastructure as a service (IaaS) and platform as a service (PaaS). It not only provides basic large models developed by itself, but also provides customers, partners and developers with Models and Services.

In order to further expand the number of public cloud customers and the scale of cloud usage, Alibaba Cloud has recently launched a series of new products and pricing policies, including demonstrating the results of the AI ​​​​large model Tongyi Qianwen, launching core product price reductions and free Trial programs, increased partner commission rates, and more. These initiatives are expected to promote the growth of public cloud demand, promote the demand for high-performance computing power, and provide healthier and sustainable growth momentum for Alibaba Cloud's long-term development.

Various businesses within Alibaba Group have also gained opportunities for intelligence due to the emergence of large-scale models. All of Alibaba’s consumer businesses have the opportunity to be restructured through large models, starting with the comprehensive intelligence of DingTalk. Zhang Yong revealed that Tongyi Qianwen is only a member of the Tongyi pre-training large model family, and Alibaba Cloud will soon launch more other pre-trained large models in the Tongyi series.

According to the latest financial report data, Alibaba Cloud Intelligence's total revenue in fiscal year 2023 was 77.203 billion yuan, and its adjusted EBITA profit was 1.422 billion yuan, a year-on-year increase of 24%, achieving profitability for two consecutive years.

The split and separate listing of Alibaba Cloud Intelligence Group will bring more opportunities and challenges to its future development. As a member of Alibaba Group, Alibaba Cloud Intelligence Group will be more flexible in terms of independence and innovation, and will continue to be committed to innovation and development in the fields of cloud computing and artificial intelligence.

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