Alibaba shares are trading lower in the US Friday, after news the Chinese ecommerce giant has purchased a local AI chipmaker called Hangzhou C-SKY Microsystems. The move comes as Alibaba seeks to expand its Internet of Things (IoT) business.
By 1530 BST, Alibaba shares were 0.59% in negative territory at $180.12. The stock has endured a tough month on the stock market.
Alibaba expands chipmaker interests
The US-listed Chinese business’s decision to purchase the small tech company C-SKY Microsystems, comes just days after the US banned US tech firms from selling chips and components to Chinese telecoms company ZTE Corp, for seven years.
“Alibaba aims to empower different industries through our cloud-based IoT solutions, in which chips play a significant role,” an Alibaba spokeswoman said in a statement.
“The acquisition of Hangzhou C-SKY Microsystems, a leading Chinese supplier of embedded CPU cores, underlines our commitment to driving the development of the chip industry,” she added.
Alibaba’s decision to make this purchase follows previous investment into C-SKY, and other chipmakers, although the Chinese retailer didn’t share any terms of the deal. However, the purchase of a chipmaker is a first for Alibaba.
The decision is also likely linked to the ecommerce giant’s desire to create its own smart tech and reduce its reliance upon partnerships with other tech businesses.
Thailand digital trade partnership
Alibaba has also signed an agreement with the Thailand government to begin building a smart digital trading hub in the country.
The move comes as the Chinese conglomerate said it plans to work with Thailand on a broad range of projects including improving the country’s tech capabilities and educating local entrepreneurs and SMEs in digital commerce.
The move will also give Alibaba greater access to Thailand’s consumer market.
“Given Thailand’s unique strengths in people and culture, we are confident of its future and growth potential under the government’s Thailand 4.0 policy,” said Alibaba Executive Chairman Jack Ma.
“We are committed to being a long-term partner of Thailand to help enable its digital transformation,” Ma added.