Alibaba shares rise as Qwen heads to Apple Intelligence in China

Alibaba’s U.S.-listed shares rose in Wednesday premarket trading after the Chinese company confirmed that its Qwen artificial intelligence model will be used inside Apple services in China. For investors, the move ties Alibaba’s AI ambitions to Apple’s effort to bring its Apple Intelligence features to one of its most important markets.

An Alibaba spokesperson told CNBC that “Qwen will be integrated into Apple Intelligence experiences within iOS, iPadOS, macOS, and visionOS for users in China.” Apple Intelligence is Apple’s suite of AI features across its devices and software, while Qwen is Alibaba’s AI model family.

Alibaba’s American depositary receipts, or ADRs, were up about 4% in premarket trading after the news, according to CNBC. ADRs are U.S.-traded securities that represent shares in a foreign company. CNBC later cited Alibaba’s ADRs as 3.7% higher, with the stock quote showing a gain of $4.23, or 3.77%, to $116.55 in after-hours data displayed at 8:01 a.m. ET.

The Cyberspace Administration of China included Apple AI services on a list of approved providers, CNBC reported. The list also included products from Chinese companies such as Huawei. CNBC said Apple had been approached for comment.

The approval caps a long wait for Apple’s AI service in China after the company first announced the offering in 2024, according to CNBC. China’s rules matter here because AI features that work in one country may need local approvals, local partners or local infrastructure before they can be offered to users in another.

The Alibaba spokesperson said the Apple-Qwen setup will let users access capabilities such as text and image understanding and generation “without needing to jump between tools,” according to CNBC. In plain terms, that means the AI model could power features inside Apple’s own operating systems rather than requiring users to open a separate app.

The deal comes as competition between the U.S. and China over artificial intelligence has grown sharper, CNBC reported. Earlier this month, Alibaba banned employees from using Anthropic’s AI, according to CNBC. U.S. lawmakers are also considering ways to limit the adoption of Chinese AI models by American companies, CNBC reported.

CNBC also reported that Meta had been forced to dismantle its $2 billion acquisition of Chinese company Manus after Beijing ordered the deal unwound. That case, along with Apple’s need for approval in China, shows how AI products are increasingly tied to government decisions as well as technology.

Apple is also exploring ways to make powerful AI models smaller, according to CNBC. The outlet reported Tuesday that Apple is in talks with PrismML, a Silicon Valley startup backed by Khosla Ventures and spun out of the California Institute of Technology.

PrismML publicly released compressed versions of Alibaba’s open-source Qwen model on Tuesday, CNBC reported. The company said it reduced the model from about 54 gigabytes to less than 4 gigabytes, which would allow all 27 billion of its parameters, the internal settings that help an AI model process information, to run on an iPhone 15 or newer, according to CNBC.

This story draws on original reporting from CNBC.