Alibaba vs. Amazon: Who Dominates the AI-Powered E-Commerce Battle in 2025?

The trillion-dollar cage match between Alibaba and Amazon just got a tech upgrade—both giants are now betting big on AI to dominate global e-commerce. Here’s how they stack up.

AI Arms Race: Who’s Winning?

Amazon’s Alexa might order your groceries, but Alibaba’s ET Brain is optimizing entire supply chains. While Jeff Bezos’ empire leans into warehouse robotics and cashier-less stores, Jack Ma’s legacy play is using AI to predict consumer trends before they happen. Both are pouring billions into R&D—but only one can claim the algorithmic high ground.

E-Commerce on Steroids

Same-day delivery? Old news. The new battleground is hyper-personalization, where AI curates everything from your next sneaker purchase to your kid’s birthday gifts. Amazon’s recommendation engine still leads, but Alibaba’s Taobao is closing the gap with scary-accurate AI shopkeepers.

The Bottom Line

Wall Street’s still split—because nothing excites fund managers like two tech titans burning cash to out-automate each other. Meanwhile, merchants and consumers reap the rewards of this AI arms race. For investors? Just remember: in the land of disruption, today’s leader could be tomorrow’s Blockbuster.

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Is Alibaba a Good Stock?

Alibaba is a major Chinese e-commerce and cloud company that also operates in digital payments and logistics. The stock has surged about 36% year-to-date. Yet, even after this strong rally, Alibaba still looks reasonably priced, trading at a much lower earnings multiple (about 15x) than global tech and e-commerce giants like Amazon.

The company recently announced a $53 billion plan to boost its AI and cloud business over the next three years. Its earlier investments in these areas are already paying off, as seen in the strong cloud growth last quarter. In the Q4 FY25 earnings call, cloud revenue jumped 18% year-over-year to RMB30.1 billion, supported by robust growth in AI-related product sales. While the company didn’t specify its AI revenue, it said that AI-related product revenue saw triple-digit growth for the seventh consecutive quarter. Also, Alibaba’s Core e-commerce platforms showed strength, with Taobao and Tmall Group (TTG) revenue increasing 9% year-over-year.

That said, some caution is still warranted, as U.S.-China trade tensions and regulatory pressures at home could limit Alibaba’s ability to expand as aggressively as it hopes. Still, with a relatively low valuation and rising strength in AI and global e-commerce, Alibaba stock looks attractive to many investors at current levels.

Is Amazon Stock a Good Long-Term Investment?

Amazon is a global leader in e-commerce, cloud computing, digital ads, and AI services. The stock has declined around 3% so far this year due to earlier pressure linked to tariffs and market volatility. While it trades at a higher valuation, about 35 times forward earnings, many investors still see value in its strong growth and market dominance.

One of Amazon’s biggest strengths is its cloud arm, Amazon Web Services (AWS), which brought in $29.3 billion in first-quarter revenue, up 17% from a year ago. The company is also making a major push in artificial intelligence, with plans to spend over $100 billion this year on data centers and custom AI chips. Alongside this, its advertising business grew 19% in Q1, and faster Prime deliveries boosted its e-commerce segment.

Still, there are some risks to consider. Rising spending could affect near-term profits, and AWS growth has slowed slightly in recent quarters. Soft guidance for Q2 also raised some concerns. In addition, trade issues and growing competition in tech remain a challenge. Even so, most analysts remain bullish, with about 98% rating the stock a Buy, thanks to Amazon’s size, scale, and continued investment in long-term growth.

Which Stock Is Better, BABA or AMZN?

Using TipRanks’ Stock Comparison Tool, we compared Alibaba and Amazon to see which e-commerce stock analysts favor. Currently, Alibaba stock holds a “Strong Buy” consensus rating from Wall Street, along with a “Perfect 10” Smart Score on TipRanks. It also offers a 46.27% upside potential, higher than Amazon’s. In comparison, Amazon stock also carries a “Strong Buy” consensus rating, with analysts projecting a 13.70% upside from current levels.