Alibaba (BABA) Unleashes Game-Changing Qwen3 Model as AI Arms Race Accelerates

Alibaba just dropped its Qwen3 AI model—and the tech world's scrambling to keep up.

The New AI Power Play

BABA's latest move throws gasoline on the already blazing AI competition fire. This isn't incremental improvement—it's a strategic leap designed to capture market share and developer mindspace.

Wall Street's Watching—But Not Impressed

While tech teams celebrate new capabilities, finance desks yawn. Another AI announcement, another temporary stock bump before fundamentals—or lack thereof—reassert themselves. Because in the end, revenue still matters more than parameters.

The Real Battle Lines

This launch isn't just about better chatbots. It's about infrastructure dominance, cloud contracts, and which platform developers choose to build upon. The winners here won't just have the best tech—they'll have the most entrenched ecosystem.

Qwen3 lands as the AI race hits hyperspeed. Alibaba's betting big that their model becomes the foundation for the next wave of applications. The market will decide if they're building the future—or just another expensive science project.

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On Friday, Alibaba Cloud launched its new Qwen3-Next architecture, starting with the Qwen3-Next-80B-A3B model. The company said it runs up to 10 times faster than the Qwen3-32B model released in April, while cutting training costs by 90%. Despite its size, it matches the performance of the larger Qwen3-235B and can run on consumer hardware.

BABA Builds Open-Source Reach

Alibaba said the boost comes from new design features, including hybrid attention, a mixture-of-experts (MoE) setup, and multi-token prediction. These upgrades let the model handle longer text, work more efficiently, and stay stable during training.

The company also released a reasoning-focused version, Qwen3-Next-80B-Thinking, which it said beat Google’s (GOOGL) Gemini-2.5-Flash-Thinking in third-party tests. By sharing its models on GitHub and Hugging Face, Alibaba Cloud is pushing Qwen as part of what it calls the world’s largest open-source AI system.

Apple Ties Add to Momentum

The release follows reports that Apple agreed to use Alibaba’s Qwen models for its “Apple Intelligence” service in mainland China. Globally, Apple (AAPL) uses OpenAI’s GPT models for its Apple Intelligence features, but in China it uses Alibaba’s Qwen due to local restrictions. This makes Qwen an important part of Apple’s strategy in one of its largest markets.

Alibaba’s new model comes as rivals like OpenAI, Google, and Anthropic are also releasing upgrades to remain ahead in the AI race. The focus on speed, lower cost, and ease of use could help Alibaba draw more developers and expand its cloud business.

Is Alibaba Stock a Good Buy Right Now?   

Analysts remain highly bullish about Alibaba’s stock trajectory. With 16 Buy ratings and one Hold rating, BABA stock commands a Strong Buy consensus rating on TipRanks. Also, the average Alibaba price target of $166.43 implies about 7.33% upside potential from current levels.