Alibaba announced Monday it will invest over $50 billion in artificial intelligence and cloud computing over the next three years, following a meeting between co-founder Jack Ma and Chinese President Xi Jinping last week.
Investors have been heavily investing in Chinese technology stocks since the beginning of the year, with Alibaba -- which operates some of China's largest online shopping platforms -- seeing its shares reach three-year highs.
The gains have been increased after a Hangzhou-based company announced significant sales growth last week, further indicating that the sector is recovering from a period of decline caused by a government crackdown.
Alibaba plans to "invest at least 380 billion yuan ($53 billion) over the next three years to advance its cloud computing and AI infrastructure", a company statement said.
The company stated that its strategy is designed to strengthen its commitment to long-term technological innovation... and highlights the company's focus on growth driven by artificial intelligence.
The statement did not provide information on how the company would distribute the funds or specify which projects would be supported.
It noted that the investment would surpass its total AI and cloud spending over the past decade.
Alibaba recently announced an 8% increase in revenue for the three months through December, exceeding expectations and reaching 280 billion yuan. This led to a 14% rise in its Hong Kong shares on the following Friday.
The CEO, Eddie Wu, stated last week that the quarterly results "demonstrated substantial progress in (Alibaba's) 'user-first, AI-driven' strategies and the re-accelerated growth of our core businesses".
The company and its industry peers faced a prolonged period of dwindling investor trust following Beijing's stringent regulatory measures targeting the tech industry in 2020.
They have been increasing in popularity in recent months, driven by the launch of a chatbot by Chinese startup DeepSeek that has significantly impacted the AI field.
The turnaround comes as the world's second-largest economy struggles with slow consumption and ongoing issues in the real estate market.
During a rare gathering with influential business leaders last week, Xi praised the private sector, stating that the current economic difficulties were "overcomeable" - a move widely seen as a gesture of support for the tech industry.
Ma remains a prominent figure despite no longer holding a position at Alibaba and keeping a low profile since regulatory authorities blocked Ant Group's high-stakes IPO in 2020.
His attendance at the meeting suggested the billionaire businessman's possible public redemption following the dispute with regulators.