To The Moon

Options Market Statistics: Alibaba Shares Jump 13% as AI Drives Cloud Unit Acceleration

$NVIDIA(NVDA)$   and other US chip stocks fell on Friday. Nvidia shares dropped more than 3% and shed about 2% for the week.

Friday's drop came after server maker $Dell Technologies Inc.(DELL)$  , a customer of those chipmakers, gave a third quarter earnings outlook below Wall Street's estimates, while a new report said Chinese tech giant $Alibaba(BABA)$   is testing a new chip to compete with Nvidia and AMD in China.

The Wall Street Journal reported Alibaba is testing a new chip for AI inferencing and that a slew of highlighted Chinese companies are developing substitutes for Nvidia's H20 China chip. Nvidia said Wednesday that it made no sales of H20 chips into China in its most recent quarter and is still awaiting clarity on new regulations that would require it to send 15% of revenue from those sales to the US government.

$Alibaba (BABA.US)$ posted a better-than-expected bottom line in the June quarter fueled by accelerated sales at its cloud computing unit and a continued revival of its e-commerce business.

Still, the Chinese giant's revenues came in under analyst forecasts. Alibaba's stock climbed 12.9% in the U.S. after initially dipping.

Revenue rose 2% year-on-year, while the company's net income was up 78%. Alibaba attributed the increase in profit to gains in some of its equity investments and the disposal of Turkish e-commerce firm Trendyol. This was offset by a decrease in income from operations.

However, excluding investment gains, Alibaba's net income would have decreased 18% year-on-year as it continues to invest in the cut-throat instant commerce space in China.

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