Baidu rules out share placement after Alibaba’s record $10B AI fundraise

Baidu ↘ 2.93% moved quickly to reassure investors it will not follow Alibaba ↘ 1.82% in tapping equity markets, saying its existing cash reserves and operating cash flow are sufficient to fund its business development. The statement came hours after Alibaba priced a landmark HK$80 billion ($10.2 billion) share placement — the largest-ever primary follow-on offering by a Hong Kong-listed company — to invest in artificial intelligence infrastructure.news.futunn+1

Alibaba's Record AI-Focused Offering

Alibaba on Sunday launched the placement of 710 million newly issued ordinary shares at HK$112.70 apiece, a 3.6% discount to its most recent closing price, according to Reuters. The company said it intends to use 100% of net proceeds to invest in "full stack" AI capabilities, including chips, infrastructure, and AI model development and deployment. The deal attracted nearly three times oversubscription from institutional investors, Bloomberg reported, though Alibaba's Hong Kong-listed shares fell sharply on Monday.streetinsider+2

Morgan Stanley, HSBC ↗ 0.03%, UBS ↘ 0.21%, and CICC served as joint bookrunners. The placement was structured as an offshore transaction under Regulation S, excluding American investors.reuters+1

Baidu: No Need for Fresh Capital

Baidu's response was direct. A company representative said the search and AI giant has no plans for additional share issuances or placements. As of the end of the second quarter, Baidu held RMB 283.1 billion in total cash and investments, with positive operating cash flow for four consecutive quarters.stheadline+1

The company also highlighted the momentum of its AI business: cloud infrastructure revenue grew 50% year-on-year, GPU cloud revenue surged 283%, and AI-related revenue now accounts for half of its general business revenue.news.futunn

Different Paths on AI Spending

The contrasting approaches underscore divergent strategies among China's tech giants as they race to build AI capabilities. Alibaba is betting that aggressive capital deployment — even at the cost of short-term dilution — will cement its position in AI infrastructure. Baidu, meanwhile, is signaling that its existing revenue streams can fund AI ambitions without turning to shareholders for fresh capital.

Baidu is scheduled to hold an extraordinary general meeting on August 26 to vote on mandates authorizing directors to issue new shares and conduct buybacks, though the company has framed these as routine governance measures rather than precursors to an imminent fundraise.barchart+1