By Yinliang (Ricky) Tan

Alibaba’s recent sharp share-price rise turned heads for a simple reason: the company is changing what it is. On the surface, the rebound rides on better momentum in on-demand delivery, instant retail, and cloud services. At a deeper level, it shows Alibaba moving from “a giant online mall” to a tech backbone that powers other businesses, with cloud technology, data, and artificial intelligence at the center.

The clearest signal is Qwen3-Max-Preview, a new AI model that boasts over a trillion parameters. But the size is not the point; what matters is what it can do. It can reason better, help with coding, and hold more natural “conversations” with users. It is also already plugged into Alibaba Cloud’s Bailian platform and the consumer app Qwen Chat. In simple terms, Alibaba is no longer just selling goods but is building a digital “brain”, and letting others use it.

This transformation also sits within a broader shake-up of China’s platform economy. For years, Meituan dominated food delivery and local services, owning everyday “what to eat, where to go” decisions. Alibaba’s answer is Taobao Instant Commerce: instead of spending heavily to buy traffic from outside, it is funnelling resources into high-frequency purchases like meals, groceries, and one-hour essentials so that users build daily habits within its own ecosystem. The logic is straightforward: the more often people return for small, immediate needs, the more likely they are to shop, pay, and engage in wider scenarios.

There is a catch, however. Price wars burn cash and don’t build real loyalty. The lasting path is better products and smoother experiences: faster logistics, easier payments, smarter recommendations, and service that just works. This is where AI matters. If AI can cut wait times, match shoppers, merchants, and riders more precisely, and fix problems within seconds, the platform that ultimately saves people the most time will win.

Rivals see this too. Meituan has launched its own model, LongCat, tuned for the tough realities of local services, aiming for quick dispatch, responsive support, and sharper merchant tools. The contrast is clear. Alibaba is building AI as a broad platform which others can build on. Meituan is using AI as a focused tool to strengthen its core offering. Different paths, same destination: AI is now part of each company’s identity.

For global investors, the key message is reinvention. Worries around geopolitics and rules have not gone away, but the story is shifting. Alibaba is signalling a future built less on selling more products and more on selling intelligence and computing: the rails that others will run on. That means judging growth not by splashy promotions, but by whether the tech truly saves time, lowers cost, and upgrades the user experience.

There’s a wider lesson too. The printing press helped fix knowledge on the page and spread it; AI will set knowledge in motion. It can generate, summarise, translate, and personalise in the moment. Alibaba’s rebound shows this change in action, from transactions to tech backbone, from clicks to capabilities. The winners will be the companies that turn AI into everyday gains that users can tangibly feel: groceries that arrive on time, services that solves issues before you notice them, and recommendations that actually understand what you want.

In short, this comeback isn’t just a stock chart. It’s a sign that the race is moving from discounts to intelligence. The new game is simple in theory, but hard in practice: make every digital interaction faster, smarter, and more useful. The platforms that save people a minute, again and again, will lead the next era.

Yinliang (Ricky) Tan is a Professor of Decision Sciences and Management Information Systems at CEIBS. His research primarily focuses on artificial intelligence and the digital economy.