Alibaba (BABA) is ramping up its tech innovation game with an intensive focus on generative AI.
Delving into this realm, Alibaba’s recent rollout of Qwen2-Math, a set of mathematics-specific large language models (LLMs), shines as a shining beacon of progress.
The fresh models, an extension of the Qwen2 LLM, aim to enhance reasoning skills in tackling intricate math problems.
With Qwen2-Math, Alibaba is carving its niche among students and math enthusiasts, promising to add muscle to its cloud computing arm.
Charting Alibaba Group Holding Limited’s Trajectory
The generative AI sector, as per Statista, is slated to hit $36.06 billion in 2024 and climb to $356.10 billion by 2030, exhibiting a brisk growth pace at a CAGR of 46.5% from 2024 to 2030. Alibaba stands at a prime juncture to seize this robust growth avenue through its expanding generative AI-powered solutions.
Alibaba unwrapped the “AI programmer,” a brainchild of its in-house LLM. This programmer amalgamates the roles of software architect, development engineer, and test engineer, streamlining developers’ application development cycles, sometimes cutting them down to mere minutes.
The company also revamped Model Studio, its AI model and application development hub, to serve a broader buffet of models and sophisticated AI utilities. Developers now have access to over 100 models from AI enterprises like Baichuan AI, and the platform integrates an open-source framework for application development.
Currently, Alibaba is leveraging generative AI prowess to fortify its global marketplaces, including AliExpress and Lazada. AI-powered tools are stepping in to aid cross-border merchants with tasks like translation, content creation, and managing product returns.
Alibaba’s foray into AI with its programming assistant, Tongyi Lingma, marks a notable stride. It amps up software development efficiency, slashing test code implementation time by more than 70% and liberating developers from hours of manual grind.
Alibaba’s expanding generative AI ventures are primed to escalate its long-term growth trajectory. The Zacks Consensus Estimate for fiscal 2025 total revenues is pegged at $141.05 billion, reflecting an 8.1% uptick year-over-year.
The outlook for BABA’s fiscal 2025 earnings stands at $8.20 per share, signaling a 4.9% dip from the prior-year reported figure. This estimate has clung steady over the last 30 days.
Navigating the Competitive Landscape
Despite being a Zacks Rank #4 (Sell) entity, Alibaba faces a staunch competitive front in the generative AI domain from the likes of Microsoft (MSFT), Amazon (AMZN), and Alphabet (GOOGL), who are all doubling down on fortifying their market supremacy.
Alibaba’s shares have clocked a 5.4% uptick in the year-to-date period, falling short of the industry’s 6.8% surge. BABA shares have lagged behind Microsoft, Amazon, and Alphabet, which have notched gains of 8.4%, 9.9%, and 17.3%, correspondingly, in the same timeframe.
Microsoft has introduced fresh generative AI and data solutions tailored for retailers, enabling personalized shopping journeys, empowering store associates, and centralizing retail data. The lineup includes Azure OpenAI Service copilot templates, retail data solutions in Microsoft Fabric, Dynamics 365 Customer Insights copilot features, and Retail Media Creative Studio.
Amazon, on the other hand, is leveraging its AI-driven assistant, Amazon Q, facilitating dialogues, issue resolution, content generation, and insights. It seamlessly connects with company data repositories, code, information, and enterprise systems, fostering efficiency in tasks, decision-making, and innovation.
Alphabet’s Google has recently rolled out three innovative open generative AI models, namely Gemma 2 2B, ShieldGemma, and Gemma Scope, under the Google’s Gemma 2 family. While Gemma 2 2B caters as a lightweight text analysis model licensed for research and commercial applications, Gemma Scope equips developers to zoom into specific model points. ShieldGemma acts as a safety classifier screening content toxicity.
Uncovering Potential: The #1 Semiconductor Stock
Dwarfed in size compared to the giant NVIDIA, which had surged over +800% following recommendations, our new top chip stock boasts immense growth possibilities.
Bolstered by robust earnings growth and an expanding clientele, it is primed to cater to the surging demands for Artificial Intelligence, Machine Learning, and Internet of Things. The global semiconductor manufacturing sector is anticipated to skyrocket from $452 billion in 2021 to $803 billion by 2028.
