BAMCO, Inc. - Baron Emerging Markets Fund on Alibaba Group Holding Limited
Thesis
Alibaba is absorbing a near-term earnings reset as it increases AI infrastructure investment and builds its Qwen ecosystem. Baron believes accelerating cloud growth and model-as-a-service revenue validate the company's full-stack positioning across chips, cloud infrastructure and models. The fund continues to view Alibaba as one of the best-positioned proxies for China's AI supply chain.
“our conviction in Alibaba remains intact.”
Key risks
- Weak Chinese consumption
- Intensifying e-commerce competition
- Higher AI capital spending and negative free cash flow
- Losses in instant commerce and other ventures