Alibaba, Huawei Dominate China's Growing Cloud Market

Zinger Key PointsChina’s cloud spending hit $11.6B in Q1 2025, up 16% YoY, as enterprise AI adoption fuels strong demand despite chip curbs.Alibaba Cloud led with 33% market share, outpacing rivals Huawei (18%) and Tencent (10%) amid rapid AI product growth.Get daily-updated rankings across momentum, growth, value, trends, and quality to spot the strongest stocks in any market.China’s cloud infrastructure spendingsurged by 16% year-over-year to $11.6 billion in the first quarter of 2025, primarily fueled by the accelerating adoption of enterprise artificial intelligence (AI) nationwide.This growth highlights cloud services’ critical role in supporting China’s expanding AI capabilities, despite ongoing U.S. chip export restrictions.The market is projected to continue its upward trajectory, with total cloud spending in China expected to climb from $40 billion in 2024 to $46 billion in 2025.Also Read:Alibaba Predicts AI Digital Colleagues Will Be Commonplace Within Five YearsAlibaba GroupBABACloud led the market with a 33% share and 15% revenue growth. Huawei Cloud followed itat 18% share and 18% growth, andTencentTCEHYCloud at 10% share, which was reportedly limited by GPU supply issues, according to SCMP,citingCanalys.Partner-driven cloud revenue made up 25% of the market in the first quarter, with that share expected to grow as ecosystem collaboration turns AI capabilities into business value, according to Canalys.Alibaba Cloud is experiencing rapid growth, particularly in itsAI-driven products, as its Qwen AI model family gains momentum.Notably, Alibaba’s Damo Academy and Zhejiang Cancer Hospital jointly developed “Grape” in June, an AI model that detects early-stage gastric cancer from 3D CT scans, outperforming radiologists, as reported in Nature Medicine. This builds on Alibaba’s 2023 pancreatic cancer breakthrough, further integrating AI into healthcare.The company is also expanding its global cloud footprint, launching new data centers in Malaysia, South Korea, and the Philippines. By 2025, Alibaba plans to roll out its Qwen models, Model Studio, and a global AI hub in Singapore, aiming to scale its cloud network across China, Asia, the Middle East, Europe, and the Americas over the next three years.This expansion is part of Alibaba’s “AI+Cloud” strategy, backed by a significant $53 billion investment plan to enhance cloud and AI infrastructure over the same period.To deepen its AI expansion, Alibaba recently partnered with smartphone makerHONOR, marking the first direct integration of its AI agents into mobile devices. Unveiled during the HONOR Magic V5 launch on July 2, this collaboration brings Alibaba’s Qwen3 large language model (LLM) and Qwen-VL vision model to power HONOR’s YOYO assistant.This enables advanced features like document analysis, role-play simulations, and real-time visual recognition, as Alizilareportedon Friday. Furthermore, specialized AI agents from Alibaba’s Fliggy and Amap now offer voice-enabled trip planning, navigation, and lifestyle recommendations within HONOR’s ecosystem.Earlier in June, Alibabalaunched updatedQwen3 AI models to assistAppleAAPLin integrating machine-learning features into iPhones, iPads, and MacBooks in China. This supports Apple’s efforts to expand its “Apple Intelligence” offerings in the country while adhering to China’s AI regulations.PreliminaryCounterpoint Researchdata indicates thatChina’s smartphone marketis poised for a rebound in the second quarter of 2025, with Huawei and Apple leading in year-over-year sales growth.Huawei is expected to post the strongest growth among major brands, potentially claiming the top spot as loyal users upgrade to new models. Apple saw a sales boost in May, driven by iPhone 16 series discounts, especially on the Pro and Pro Max models.Analysts attribute this second-quarter growth partly to government smartphone subsidies but caution about potential risks if these subsidies are reduced later in the year.Alibaba stock has surged 26% year-to-date, fueled by AI-driven cloud growth, e-commerce strength, and the phasing out of non-core assets.Price Action:BABA shares are trading higher by 0.29% to $106.96 premarket at last check Friday.Read Next:Amazon Unveils Powerful New AI Servers To Support Nvidia’s Most Advanced ChipsPhoto via ShutterstockLoading...Loading...BABAAlibaba Group Holding Ltd$106.870.22%Stock Score Locked: Edge Members OnlyBenzinga Rankings give you vital metrics on any stock – anytime.Unlock RankingsEdge RankingsMomentum84.60Growth94.30Quality32.76Value87.57Price TrendShortMediumLongOverviewAAPLApple Inc$210.52-0.89%TCEHYTencent Holdings Ltd$63.19-%Market News and Data brought to you by Benzinga APIs© 2025 Benzinga.com. . .Posted In:AsiaNewsTop StoriesTechMediawhy it's moving