Alibaba Group Chairman Joe Tsai announced on Thursday that the Chinese tech giant will collaborate with Apple on artificial intelligence for iPhones sold in China. The news sent Alibaba’s Hong Kong-listed shares soaring over 9% to a three-year high.
Speaking at the World Governments Summit in Dubai, Tsai revealed that Apple had evaluated multiple Chinese firms before selecting Alibaba for the partnership. “They talked to a number of companies in China. In the end, they chose to do business with us. They want to use our AI to power their phones. We feel extremely honored to do business with a great company like Apple,” Tsai said.
Alibaba’s shares surged as much as 9.2% to HK$124.3, their highest level since January 2022. Apple has not yet responded to requests for comment.
The AI collaboration comes at a crucial time for Apple, which has been struggling with declining iPhone sales in China. Increased competition from domestic brands, particularly Huawei, has impacted Apple’s market position.
Analysts have cited the lack of advanced AI features as a key disadvantage for Apple compared to its competitors in the Chinese smartphone market.
Apple suffered a significant setback in China in 2024, losing its position as the country’s leading smartphone vendor. According to market research firm Canalys, Apple’s annual shipments in China declined by 17%, allowing domestic brands to gain an edge.
Vivo emerged as the market leader with a 17% share, followed by Huawei at 16%, while Apple dropped to third place with 15% of the market.
Alibaba has been a top AI investment choice in early 2025, with its stock price climbing over 40% so far this year. The company further solidified its position in the AI space with the recent release of its Qwen 2.5 model in late January. Alibaba claims that Qwen 2.5 surpasses DeepSeek-V3, which gained attention earlier this year for its capabilities and affordability.
Meanwhile, Tesla and SpaceX CEO Elon Musk made headlines with an offer of $97.4 billion to acquire the company behind ChatGPT, further intensifying the global AI race.
