Bloomberg:
First, with Alibaba’s overall numbers, how concerning is it that profitability is being impacted by competition?
Jacob Cooke:
It’s not that concerning. This was well communicated. Alibaba had already outlined significant investments in AI for 2025, and they’ve announced those will double in 2026. That will continue to put some pressure on income.
That said, some of the numbers were quite optimistic. The AI developments, particularly around their token hub, show strong potential. This has been part of a clearly communicated multi-year plan, and execution so far appears to be on schedule.
Bloomberg:
Let’s talk about AI adoption and competition, particularly with Tencent. Many see Tencent’s advantage through WeChat and its integration with agentic AI. How does Alibaba ensure its AI stack remains competitive?
Jacob Cooke:
There are a couple of factors. First, Alibaba’s Qwen open-source model is very strong. I’m running it locally on my MacBook, and it’s one of the best models available for local deployment.
When you look at agent-based AI, these systems will ultimately drive token consumption. Opening up a token hub is a smart move. Also, this was Alibaba’s 10th consecutive quarter of triple-digit AI revenue growth.
When they talk about ambitious targets like $100 billion in revenue, there’s a credible path to get there.
Another important point is AI adoption in China. They may not always lead in top-tier model performance, but user adoption is extremely high. Even with slightly later adoption cycles, usage levels in China are now exceeding those in the US for some platforms.
There’s also a growing willingness among companies to invest in AI tokens to improve productivity. That should support continued triple-digit growth into 2026.
Bloomberg:
You’ve always had a strong read on the consumer in China. What are you seeing on the ground, especially around the hype and adoption of AI tools?
Jacob Cooke:
It’s not just on the streets, it’s everywhere, especially across social media.
What’s striking is the level of innovation. Many of these models are now running locally, which has made AI far more accessible. You no longer need a deep technical background or reliance on cloud infrastructure like AWS equivalents.
People can buy relatively affordable hardware, even older Mac devices, and run these systems at home or in small offices. That’s allowed AI to move from a niche technical capability to mass adoption.
Bloomberg:
What about regulatory risk? Investors in companies like Alibaba or Tencent are always aware of potential government intervention. Are you seeing pushback?
Jacob Cooke:
There may be some concerns in specific cases, but from what we’re seeing on the ground, local governments have been very supportive.
In regions like Jiangsu and Zhejiang, there are even government-led training sessions helping people set up and use these systems. That level of institutional support is something we haven’t seen before.
There could be security concerns around certain models, but there are also strong domestic alternatives emerging. For example, Moonshot has launched Kimi, which is well suited to the Chinese market and more compatible with local regulatory frameworks.
Bloomberg:
Putting this into context for brands looking to access Asia, how does the AI-driven landscape change the way companies reach consumers?
Jacob Cooke:
AI has made accessing Asia significantly easier.
Chatbots aren’t necessarily the most effective interface right now, but generative AI is transforming operations. For example, brands can take a single set of product images and adapt them for China, Japan, and Korea without running separate shoots.
They can localise language, adjust creative, and engage with customers across multiple markets far more efficiently.
This creates real economies of scale. Instead of treating Asia as a dozen separate markets, brands can approach it more cohesively.
AI is also improving areas like inventory planning. We’re analysing social media signals to anticipate demand trends, such as what products may perform well seasonally.
Overall, AI is lowering the barrier to entry and reducing the cost of market access compared to the pre-AI environment.
Bloomberg:
Beyond Alibaba and Tencent, who else should marketers be paying attention to?
Jacob Cooke:
There’s a broad ecosystem emerging. Moonshot’s Kimi is one of the strongest on-premise models available.
In places like Hangzhou, where we have an office, there’s a dense cluster of AI companies. DeepSeek is nearby, RED is in the same area, and the level of activity is comparable to Silicon Valley.
We’re still early in identifying the long-term winners. What’s clear is that the barrier to entry is falling rapidly. DeepSeek, for example, launched its models with a relatively small team.
We expect continued innovation and a very dynamic landscape over the next year.
