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BABA −7.05% on Nov 12 · Analysis updated Nov 12, 2026, 4:48 PM ET
Why is Alibaba Group Holding Ltd (ADR) (BABA) stock down?
BABA fell about 7% on Nov 12 to $94.36, its fourth straight lower session and about 14% below the Nov 6 close of $109.45. Volume of about 25.3M shares is roughly 2.5 times the recent 8M to 10M norm, so the selling was heavy. The trigger is a report that the US Commerce Department is finalizing a rule to block Chinese AI firms from remotely using advanced chips in overseas data centers. Separate reports say Alibaba is the biggest customer of Megaspeed, a Singapore chip buyer under US investigation, though Alibaba is not the target. The stock sits just above its 52-week low of $91.99 and the $93.39 support level. RSI is near 34, close to oversold, and the shares are below all key moving averages. The rule is not final. Commerce is still consulting other agencies, and lawyers question its legal authority, which leaves room for relief. Analyst targets of roughly $183 to $190 are far above the price, and the T-Head spin-off adds potential value. The Nov 19 results are the next big event. Investors will look for how much cloud capacity depends on chips rented abroad, plus AI capex and cloud growth. Near term, policy risk and negative momentum dominate, although an oversold reading and a heavily sold-off stock could produce a bounce.
News behind the analysis
- Alibaba Sinks 7% as U.S. Readies Curbs on China's Remote AI Chip AccessAlibaba fell 7% after a report that Commerce is preparing a rule barring Chinese AI firms from using advanced chips in overseas data centers. The rule could cover seven more countries, including Malaysia, Singapore and Thailand.
- Alibaba Sinks 7% as U.S. Readies Curbs on China's Remote AI Chip Access (Yahoo Finance)The FT reported Alibaba is the biggest customer of Megaspeed, a Singapore chip buyer under U.S. investigation. Alibaba is not the target of the probe, and the rule is not final.
- Why Is Alibaba Stock Falling Thursday?BABA fell nearly 5% premarket to $96.93 on U.S. scrutiny of Nvidia AI chip access. It remains below its 20-, 50- and 200-day moving averages.
- Alibaba, Tencent shares fall on report U.S. weighs curbs on remote AI chip accessHong Kong-listed Alibaba fell 5% to HK$95.6 and Tencent slipped 1.5%. The measure could be announced this month.
- China chip stocks rally as U.S. weighs curbs on remote AI accessDomestic chip names such as Cambricon rose more than 11% while Alibaba fell 4.9%. Tencent, Alibaba and ByteDance reportedly have deals with overseas data-centre operators for Nvidia chips.
- Chinese AI firms rush to secure Nvidia chip capacity as spy scandal stirs fear of US curbsChinese AI firms are trying to rent Nvidia capacity abroad, fearing the Remote Access Security Act could gain momentum. The bill passed the House 369-22 and awaits Senate action.
- US Weighs Curbs on China's Remote AI Chip AccessLawyers note Commerce may lack statutory authority under current law to regulate remote computing access. The proposed rule would treat remote access like physical chip transfers.
- Alibaba (BABA) Stock Price Prediction: Bears still have the tapeRSI is about 33.6, near oversold. The price sits near the lower Bollinger Band at $94.40 and just above support at $93.39.
- Alibaba Group (BABA) Stock Price, News & AnalysisConsensus rating is Moderate Buy with an average price target of $183.26. The 52-week range is $91.99 to $181.10.
- Alibaba Group Holding Ltd - ADR (BABA) Stock Price & NewsGoogle Finance shows 13 analysts with targets averaging $190.47. Headlines also mention the planned Hong Kong IPO of chip unit T-Head.
About Alibaba Group Holding Limited American Depositary Shares, each represents eight Ordinary Shares
Alibaba Group is a Chinese technology company that runs China's biggest online marketplaces (Taobao and Tmall), one of the largest cloud computing businesses in Asia (Alibaba Cloud), and the Qwen family of AI models. What sets it apart is its 'full-stack' AI strategy: it builds its own foundation models, cloud infrastructure and in-house chips (through its T-Head unit), alongside a large consumer commerce operation. It trades in the US as ADRs, each worth eight ordinary shares, and is also listed in Hong Kong.
How it makes money
Most revenue still comes from China e-commerce: commissions, advertising and marketing services that merchants pay on Taobao and Tmall, plus fast-growing 'quick commerce' (rapid local delivery). The second big source is AI Cloud and Compute Services, which sells computing power, storage and AI model access to businesses. In the June 2026 quarter, cloud brought in roughly 48 billion yuan (about US$7 billion), or roughly 18% of total revenue of about 269 billion yuan (about US$40 billion). Cloud revenue grew about 45% year over year. Smaller amounts come from international commerce (AliExpress, Trendyol, Lazada), logistics (Cainiao) and other businesses. Profits have recently fallen sharply, mainly because Alibaba is spending heavily on AI infrastructure and on quick commerce.
What usually moves BABA
- AI and cloud revenue growth, and how much it spends on AI infrastructure
- Chinese consumer spending and price competition in e-commerce and quick commerce
- Chinese government regulation and economic stimulus policy
- US-China trade, chip export controls and rules on delisting US-listed Chinese stocks
- Share buybacks and the yuan-dollar exchange rate