Alibaba shares fall about 5% to $103.67 in morning trading

Key Facts

Alibaba shares fell about 5% in U.S. morning trading on October 21, 2026, according to 24/7 Wall St., as the company expanded spending on computing infrastructure. The shares traded at $103.67 in the trading snapshot reported by the website, which described the percentage decline as approximate. At the start of the same session, the S&P 500 rose 0.2%, according to an update published by Investing.com. The index reached 7,725.36 points at the open, before the morning trading snapshot for the Chinese company's shares. The stock's move came a day after a Reuters report on orders for graphics cards placed with Nvidia by Chinese companies, including Alibaba.

Alibaba had disclosed in a filing with the U.S. Securities and Exchange Commission that capital expenditure totaled 67,678 million yuan in the quarter ended June 30, 2026. Spending rose 75% from the same period a year earlier, with the company attributing the increase partly to "higher prices across a wide range of chip components." In its results for the same period, the group reported 45% year-on-year growth in revenue from cloud and AI computing services. Adjusted earnings before interest, taxes and amortization for the cloud segment rose 133% to $830 million, according to the group's statement. The segment's adjusted earnings growth thus exceeded the growth in revenue from cloud and AI computing services that the company reported for the June quarter.

Against the backdrop of Chinese internet companies' results, JD's filing with the U.S. Securities and Exchange Commission showed its net revenue fell to 346.4 billion yuan in the second quarter of 2026. The decline was 2.9% from the corresponding quarter a year earlier, while the company's chief executive attributed improved earnings to the performance of other businesses within the group. She said this reflected "the strong profitability of the core retail business and continued narrowing of food delivery losses," according to the quarterly earnings filing. PDD, meanwhile, reported net income attributable to ordinary shareholders of 27.2 billion yuan in the second quarter of 2026. That profit fell 12% from 30.8 billion yuan in the second quarter of 2025, according to the company's earnings statement.

On chip purchases, the Reuters report published on October 20 included ByteDance, Alibaba and Tencent among the companies that placed orders with Nvidia. The agency cited sources familiar with the matter as saying the companies collectively ordered more than 3 million graphics cards, according to the report carried by Investing.com. The potential value of these orders exceeded $35 billion, based on the list prices used in the agency's report on the Chinese companies' purchases. That value represents purchase orders placed with Nvidia, rather than revenue realized by the company or the value of shipments confirmed for delivery to buyers. The quantities and total value cover the combined orders of the companies named, including Alibaba, which had already announced a substantial increase in capital expenditure during the June quarter.

But Nvidia told customers it "cannot guarantee that orders will be fulfilled," according to Investing.com's account of the Reuters report on the Chinese companies' purchases. The company attributed this to Chinese demand exceeding its planned production capacity, according to the report's account of its communications with customers. Nvidia told partners they might receive as little as 5% of the quantities they ordered, according to the same report. The upper end of the range communicated by the company was 10% of the quantities ordered, with the amount partners would receive remaining uncertain. These estimates apply to the quantities of orders that could potentially be filled, while the company linked its ability to fulfill them to its production plans in the face of Chinese demand.

As for the upcoming supply schedule, Reuters cited its sources as saying Nvidia told customers commercial deliveries of the cards would begin in the first quarter of 2027. This date refers to the start of commercial deliveries communicated by the company to buyers, with its caveat about its ability to fulfill their orders still in place. On production, the report said Nvidia told partners it could manufacture no more than 3 million cards of the model mentioned globally. This ceiling applies to expected production during 2027 and covers the company's worldwide output of those cards, according to Investing.com's account of the Reuters report. Under the schedule communicated to customers, deliveries would begin in the first quarter of that year, within the production and allocation limits Nvidia presented to its partners.