Alibaba Group (NYSE:BABA) has launched an in-house robotics team, marking its entry into the competitive race for AI-powered physical products.
The new team, led by Justin Lin of Alibaba’s Qwen division, will focus on robotics and embodied AI. It aims to advance the company's flagship AI models.
Lin previously worked on the company’s multimodal AI systems, which can understand and generate responses from text, images, and audio, Bloomberg reported on Wednesday.
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Lin said the team is working to turn multimodal models into foundation agents capable of long-horizon reasoning and real-world applications.
These models should “step from virtual world to physical world,” he adds.
In September, CEO Eddie Wu projected global AI investment could reach $4 trillion over the next five years.
Alibaba stock gained 114% year-to-date as its cloud unit and AI models gain traction.
UBS projects Alibaba’s second-quarter fiscal 2026 revenue to rise 1% year-over-year to 239 billion Chinese yuan. That’s due to the impact of removing offline retail assets, such as Sun Art and Intime, as reported.
UBS expects 6% growth in Gross Merchandise Value and a 10% rise in customer management revenue for China’s e-commerce sector, supported by increased Taobao traffic. It forecasts 8.8 billion Chinese yuan in EBITA for the segment, along with 30% year-over-year growth for Alibaba Cloud, achieving an 8.5% EBITA margin.
UBS expects international commerce revenue to grow 15%, but with limited profit due to cautious investment.
Despite the earnings pressure, UBS believes core businesses, such as Taobao, Tmall, and cloud, are performing slightly better than expected. However, it cut Alibaba’s EPS forecasts for fiscal 2026–2028 by 4–8%, reflecting rising group-level losses.
Price Action: BABA stock was trading higher by 0.24% to $181.77 premarket at last check Wednesday.
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