Alibaba and Baidu shares jump in Hong Kong on Apple AI partnership

Shares of Chinese tech leaders Alibaba and Baidu experienced significant gains on Thursday, buoyed by their recent partnership with Apple to integrate AI technologies. In Hong Kong, Alibaba's stock rose by 5% after the company announced that its Qwen AI model will be incorporated into Apple’s services in China. Meanwhile, U.S.-listed shares of Alibaba also saw a slight increase following a spokesperson's confirmation to CNBC that "Qwen will be integrated into Apple Intelligence experiences across iOS, iPadOS, macOS, and visionOS for users in China." Baidu, too, benefited from the collaboration, as its shares on the Hong Kong exchange climbed by 4%. The company revealed its ongoing efforts with Apple to develop Apple Intelligence functionalities for iPhones in the region. This announcement aligns with earlier reports suggesting that Baidu's AI chip division, Kunlunxin, is eyeing an initial public offering in Hong Kong, potentially valuing the unit at $50 billion. Furthermore, the Cyberspace Administration of China recently included Apple's AI services, alongside six other smartphone-based AI providers such as Huawei Technologies, in a list of approved entities. According to the Alibaba spokesperson, the partnership will enable users to utilize capabilities such as text and image understanding and generation seamlessly, without switching between different tools. This collaboration emerges amid escalating tensions in the technological race between China and the U.S., particularly in the realm of AI. The U.S. has been tightening restrictions on China's access to advanced semiconductor technology, while China is taking measures to limit American investments in its tech sector. A report by the RAND research organization emphasizes that leadership in AI is crucial for economic competitiveness, global standard-setting, and the preservation of democratic governance.