Alibaba sells entire Lingxi Games stake to Trustar Capital, pivots to AI and cloud

Published Aug 19, 11:27 AM UTC

Alibaba Group has agreed to sell its entire stake in game studio Lingxi Games to private equity firm Trustar Capital for an estimated $1.5-2 billion, signaling a strategic pivot away from non-core assets. The sale follows recent divestitures of hypermarket chain Sun Art and department store operator Intime. Alibaba is redirecting resources toward AI and cloud computing, centered on its open-source large language model Qwen, which has surpassed 100 million monthly active users. Cloud revenue grew 34% in the latest fiscal year, with AI-related product revenue posting triple-digit growth for eleven consecutive quarters. However, the company's e-commerce division continues to face strong competition from Pinduoduo, JD.com, and Douyin, while high expenditures in quick commerce impact profitability. Hedge fund ownership of Alibaba fell to 102 funds from 115 in the previous quarter, despite a 27.4% share price rally in July. The stock trades at 17.01 times forward earnings.