Alibaba's Chip Unit Files for Hong Kong Listing — Update

By Tracy Qu and P.R. Venkat

Alibaba Group is preparing to list its chip unit in Hong Kong, setting up a pivotal moment in its multibillion-dollar push into artificial intelligence.

Alibaba said late Tuesday that the Hong Kong stock exchange confirmed it can proceed with an initial public offering for its semiconductor business, T-Head, which filed a confidential application in September to list on the exchange's main board.

The listing, which still needs Chinese securities regulators' approval, could see T-Head valued at $85 billion, Nomura estimates show.

If successful, the move would mark a milestone for Beijing's efforts to become self-reliant in critical technological areas like cutting-edge chips that the U.S. dominates.

It would also be a win for Alibaba, which faces slowing growth in its core e-commerce business and must hone an edge in AI to stay relevant.

The technology conglomerate has committed to spending more than $53 billion over three years to make AI an engine of growth.

Founded in 2018, T-Head forms part of Alibaba's strategy to control both the hardware and software that power AI.

The chip unit has gained attention in recent years as the U.S.-China tech race fuels the rise of China's semiconductor and AI industry. In September, it rolled out a new AI chip, the Zhenwu V900, that Alibaba said was its most powerful yet.

"We regard T-Head as one of China's top-tier domestic chip designers," Nomura analysts said in a note. Alibaba's ability to partially self-supply AI chips could also enhance its competitiveness amid a severe shortage of semiconductors, they added.

Still, Alibaba's ambitions face strong competition.

Even with U.S. restrictions curbing supply to China, Nvidia's chips still command a considerable share of the local market, and T-Head is also vying with domestic rivals like Huawei, Baidu and Cambricon.

Electronics giant Huawei's chips are widely recognized as one of the most promising alternatives to Nvidia in China, while the chips made by Baidu's Kunlunxin unit rank highly too. Baidu is also planning to spin off and list its chip business.

Alibaba didn't give a timeline for the T-Head listing, nor provide details on IPO pricing or size.

It said the spinoff will let investors value T-Head on its own merits, separately from the rest of the company. T-Head is expected to remain an Alibaba subsidiary post-listing.

Shares of Alibaba were last trading 0.8% lower on Wednesday.

Write to Tracy Qu at tracy.qu@wsj.com and P.R. Venkat at venkat.pr@wsj.com

(END) Dow Jones Newswires

November 11, 2026 00:05 ET (05:05 GMT)