business π Alibaba stock drops 40% amid AI spending chaos
Alibaba has seen a roughly 40% decline from its January high as AI spending pressures loom over the tech giant. The company, based in China, recently sold 710 million new shares for about $10.2 billion to fuel its AI infrastructure. During the June quarter, net income plummeted 75% while capital spending jumped 75% to 67.68 billion yuan. Michael Burry believes the stock's decline is not over and predicts Alibaba needs to fall by half. Investors are watching if AI revenue can eventually outpace the massive capital expenditures.