Alibaba Group Holding (阿里巴巴) chairman Joe Tsai (蔡崇信) yesterday said that the company would partner with Apple Inc on artificial intelligence (AI) for iPhones sold in China, sending the Hong Kong-listed shares of the Chinese tech giant soaring over 9 percent to a three-year high.
“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 at the World Governments Summit in Dubai.
The Hong Kong-listed shares of Alibaba jumped as much as 9.2 percent to HK$124.3, their highest since January 2022.
Photo: AFP
Apple has yet to provide its full suite of AI features in China because of regulations that require it to partner with a locally accredited company, Tsai said.
He said he expects that would be the case for the long term, but did not specify if Alibaba is or would be the exclusive AI provider for Apple in China.
Apple last year signed a landmark deal with OpenAI to integrate ChatGPT into iPhones internationally.
The AI integration comes at a critical time for Apple, which has faced declining iPhone sales in China amid growing competition from domestic rivals, particularly Huawei Technologies Co (華為).
Industry analysts have pointed to the absence of advanced AI features — a key selling point in latest-generation smartphones — as a significant disadvantage for Apple in the Chinese market.
Apple suffered a notable setback in China last year, losing its crown as the country’s leading smartphone vendor as annual shipments in China fell 17 percent, data from market research firm Canalys showed.
Vivo Communication Technology Co (維沃) captured the largest market share at 17 percent, while Huawei secured second place with 16 percent, pushing Apple to third place with 15 percent of the market, the data showed.
Alibaba has become a Chinese AI favorite among investors, with its stock price up over 40 percent so far this year.
The firm late last month released a new version of its Qwen 2.5 AI model, whose functionality it said surpassed that of DeepSeek-V3, which caused a stir earlier this year for its capability and low cost.
Meanwhile, Baidu Inc (百度) yesterday announced it was making its flagship AI chatbot free, making its own foray to grab a larger slice of the market.
Additional reporting by Bloomberg
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