Alibaba unveils new AI chip and prepares large-scale data center expansion

Chinese Alibaba has unveiled a new artificial intelligence accelerator, Zhenwu V900, and announced a large-scale plan to expand its computing infrastructure: by 2032, the total capacity of Alibaba Cloud data centers worldwide is expected to exceed 20 GW.

The new chip was developed by Alibaba's semiconductor division T-Head. The company calls Zhenwu V900 the most powerful Chinese AI accelerator and states that its performance is approximately three times higher than the previous Zhenwu M890.

Alibaba CEO Eddie Wu introduced the new processor on September 22 at the Apsara conference in Hangzhou. According to him, systems based on Zhenwu V900 can be combined into clusters of up to 500,000 chips for training and running the most powerful cutting-edge AI models.

Alibaba expects a significant increase in production of its own AI chips in the coming years. The previous generation, Zhenwu M890, has already begun large-scale installation in Alibaba Cloud infrastructure.

At the same time, the company is preparing a much larger network of data centers. According to Wu, customer demand for AI computing is now growing so fast that equipment supply chain constraints globally are already limiting the increase in available capacity. Therefore, Alibaba, together with partners, plans to accelerate infrastructure construction.

By 2032, data centers managed by Alibaba Cloud are expected to exceed 20 GW of total capacity. This is the company's long-term goal to meet the computing needs of models, autonomous AI agents, and other services that require ever more processor resources.

Alibaba is simultaneously preparing for a sharp increase in the scale of its own models. Wu reported plans to train a new generation of AI models with 5-10 trillion parameters, which will require significantly larger computing infrastructure.

The expansion continues Alibaba's multibillion-dollar investment program. In 2025, the company announced it would invest at least 380 billion yuan, or about $53 billion, in AI and cloud infrastructure over three years – more than it spent on these areas over the previous decade.

In August 2026, Alibaba additionally raised HK$80 billion through a share placement. About 60% of these funds were planned to be directed to global computing infrastructure, and the rest to the construction of large AI data centers and upgrading cloud systems.

The investments are already supporting the rapid growth of Alibaba's cloud business. In the quarter reported in August, revenue from AI Cloud and Compute Services grew 45% year-on-year to $7.1 billion, and revenue from AI-related products showed triple-digit growth for the twelfth consecutive quarter.

Based on materials from: Bloomberg, The Paper, Alibaba Group, Alibaba Group - investment program