Key Takeaways
- Alibaba on Monday slashed prices for international cloud customers as it tries to take advantage of artificial intelligence (AI) product demand.
- The cuts will average about 23%, although some could be as much as up to 59%.
- Alibaba explained that the move was part of its “AI first strategy.”
Chinese conglomerate Alibaba Group Holdings’ (BABA) cloud division on Monday announced big price cuts for its international customers as it tries to increase its reach into artificial intelligence (AI).
Alibaba Cloud said the reductions would total up to 59% for its core public cloud products for those using the company’s international data centers outside of the Chinese mainland.
It noted the “new pricing strategy” would include five categories: compute, storage, network, database, and big data products. The company added the average cost savings would be 23%. In February, Alibaba slashed prices for its Chinese customers.
Alibaba called the decision part of its “AI first strategy,” which is designed to make core computing resources more accessible to customers of all sizes.
Selina Yuan, president of International Business for Alibaba Cloud Intelligence, explained that cloud infrastructure “is poised to be the key cornerstone for the future of AI, and our commitment lies in making sure that the foundation for AI development remains affordable.”
American depositary receipts (ADRs) of Alibaba were little changed as of 1:35 p.m. ET Monday. They are 4% lower in 2024 and down 29% in the last 12 months.