Cai Chongxin, Wu Yongming's Letter to Shareholders: Striving to build AI + Cloud into another growth driver for Alibaba.

On May 20th, Alibaba Group Chairman Cai Chongxin and CEO Wu Yongming jointly released a letter to shareholders. The letter stated that Alibaba's AI business has moved beyond the initial investment phase and officially entered the commercialization phase. AI is driving the overall upgrade of Alibaba Cloud's business, shifting growth momentum from traditional computing storage to models, computing power, and intelligent edge services. The letter mentioned that Alibaba is striving to make AI + Cloud another growth driver for the company. The company is increasing its investment in full-stack AI capabilities: continuously increasing investment in AI infrastructure construction and self-developed chips; at the model and application level, investing in building stronger basic model capabilities, attracting more applications to connect, and creating more powerful MaaS products to efficiently link models and applications. In the consumer sector, instant retail has become the core strategic pillar for the upgrading of Taobao and Tmall platforms. Instant retail has strategic significance in utilizing AI to acquire new users, enhance user stickiness, meet diverse consumer needs, increase transaction volume, and elevate commercialization levels. The company must stay ahead of user needs, remain agile in a rapidly changing market, in order to win in the competition. The full text is below: Respected investors: Today, we are standing at a crucial turning point for Artificial General Intelligence (AGI). A large number of AI intelligent agents will increasingly take on digital work, with each agent driven by tokens generated by models and becoming the main interaction interface between people and the digital world. Faced with such profound industry changes and strategic opportunities, Alibaba Group is at the forefront of a new round of entrepreneurship and innovation as we invest towards the future. Here, we hope to share our thoughts on the future with you, including our strategic positioning, competitive advantages, and how to seize the next wave of growth opportunities. Entering the era of AI intelligent agents, AI models and capabilities are rapidly integrating into various mainstream work and business scenarios, with token consumption rapidly increasing across industries. As a provider of full-stack AI capabilities represented by Alibaba, the potential market reach is expected to achieve exponential growth. Against this backdrop, Alibaba's AI business has moved beyond the initial investment phase and officially entered the commercialization phase. Driven by strong AI demand, the external commercialized revenue growth of the Cloud Intelligence Group accelerated to 40% in the last quarter of this fiscal year, with AI-related revenue accounting for 30%. AI is driving the overall upgrade of Alibaba Cloud's business, shifting growth momentum from traditional computing storage to models, computing power, and intelligent edge services. At the AI infrastructure level, our self-developed Flathead AI chip has been successfully mass-produced, providing high-quality computing power support for cloud computing infrastructure and the Maa5 reasoning platform. In basic models, our research and development have significantly accelerated, with the Qianwen large model being stably iterated three times in the past three months. The latest generation of large model Qwen3.7-Max has been newly designed for intelligent agents, achieving continuous breakthroughs in core abilities such as programming and reasoning. To complement the Qianwen model family, we are also accelerating the layout of dedicated models, including the introduction of the open-world model HappyOyster that supports real-time interactive creation and the multi-modal model HappyHorse focused on cross-modal understanding and generation. At the application level, in November 2025, we launched the Thousand Apps aimed at C-end users, a versatile personal AI assistant that integrates life, work, and learning. The Thousand App is deeply integrated with various applications within the ecosystem, including Taobao Tmall, Taobao Flash Sale, Fliggy, Damai, Gaode, Alipay, etc., with unique advantages in daily life, services, productivity, and entertainment fields. This broader integration expands user coverage, enhances interaction between the Alibaba ecosystem and external services, and solidifies our leading position in the application AI field. We also released the enterprise-level AI native work platform Wukong for B-end users, which calls AI intelligent agents to process complex workflows and integrates skill modules built on the Alibaba ecosystem. Wukong and Thousand App together form our AI application layout targeting both B-end and C-end users. With full-stack capabilities in the AI value chain, Alibaba holds a strategic advantage in the new era of AI. Relying on talent, technology, and resource accumulation, we are confident in seizing opportunities in the era and striving to make AI + Cloud another growth driver for Alibaba. To achieve this vision, we are increasing our investment in full-stack AI capabilities: we will continue to increase investment in AI infrastructure construction and self-developed chips; at the model and application level, we will invest in building stronger basic model capabilities, attracting more applications to connect, and simultaneously creating more powerful MaaS products to achieve more efficient linking of models and applications. We see the enormous value and development opportunities in the market. In the consumer sector, instant retail has become the core strategic pillar for the upgrading of Taobao and Tmall platforms. With over 1.1 billion internet users in China and the world's largest online retail market, our e-commerce business is rooted in this vibrant market, with Taobao and Tmall continuing to focus on user growth and experience enhancement. We see the strategic significance of instant retail in using AI to acquire new users, enhance user stickiness, meet diverse consumer needs, increase transaction volume, and elevate commercialization levels. Instant retail is the inevitable path we must take in accordance with the principle of "customer first": because consumer behavior has undergone profound changes, the expectation of 30-minute rapid delivery has become the norm. We must stay ahead of user needs, remain agile in a rapidly changing market, in order to win in the competition. Growth is the constant theme of Alibaba. We will deepen our technological innovation, deeply integrate cutting-edge technology into core businesses, and if we can create value for customers, we will inevitably create value for shareholders. We believe that to seize the initiative in fierce competition, Alibaba must maintain a "growth mindset" - embrace change, accumulate strength, and win the future with long-termism. This is Alibaba.