Alibaba Unveils New AI Chip, Plans 20 GW Data Center Buildout
The company is increasing spending on chips, models and computing capacity as it pushes deeper into artificial intelligence.
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Alibaba Group has unveiled a new AI accelerator and set a target of 20 gigawatts of global data center capacity by 2032, expanding its investment in the infrastructure needed to train and run large AI models.
The new Zhenwu V900, developed by Alibaba’s T-Head semiconductor unit, delivers about three times the performance of its predecessor, the company said. Chief Executive Eddie Wu said the chips can be connected in clusters of up to 500,000 units for large-scale model training.
Alibaba has committed more than $53 billion over three years to AI and related infrastructure. It also raised about $10.2 billion through a Hong Kong share offering in August.
The company is trying to build more of its own computing stack as Chinese technology groups look for alternatives to Nvidia hardware. T-Head has delivered 560,000 processors from the Zhenwu family, according to Alibaba, with the chips deployed by more than 400 external customers.
Alibaba said it plans to update the accelerator line annually. Bloomberg News has also reported that the company is considering a listing of T-Head.
The spending extends beyond hardware. Alibaba plans to develop an AI model with between 5 trillion and 10 trillion parameters, aimed at handling longer and more complex tasks.
The expansion is placing pressure on earnings. Alibaba’s quarterly profit fell by more than 75% in the latest period after nearly $10 billion in spending. The company has said annualized revenue from AI-related products is expected to reach $10 billion in the current quarter, while it is targeting $100 billion in annual cloud and AI revenue within five years.
Wu said the company expects computing demand to continue rising sharply as AI models become larger and more widely used.
Alibaba shares rose more than 5% in Hong Kong after the announcements, while Tencent gained more than 7%.
