BEIJING — Alibaba is allegedly aiding the Chinese military in identifying U.S. targets, as stated in a White House memo, the Financial Times reported on Friday.
The memo claimed that “Alibaba offers technological assistance for Chinese military ‘operations’ directed at targets within the U.S.,” as reported by the FT.
The FT remarked that it could not independently validate these claims and did not disclose a complete version of the memo. It remains unclear when the memo was issued. The White House has not provided any comments upon request, while the FT affirmed its commitment to its reporting.
“The claims and insinuations within the article are entirely inaccurate,” Alibaba conveyed in a statement to CNBC regarding the FT report.
“We question the motives behind the anonymous leak, which the FT concedes it can’t verify,” Alibaba pointed out. “This nefarious public relations maneuver evidently originated from a rogue element aiming to sabotage President Trump’s recent trade agreement with China.”
U.S. President Donald Trump and Chinese President Xi Jinping convened in South Korea last month for the first meeting since Trump commenced his second term in January. The leaders consented to a reduction of tariffs and export restrictions for a period of 12 months, alleviating bilateral strains that have intensified this year.
The ambiguity surrounding the FT report “does raise concerns that some of the administration’s China hardliners may be aiming to undermine the President’s agreement with Xi Jinping,” remarked Andy Rothman, founder of the consulting firm Sinology, on CNBC’s “Squawk Box Asia” on Monday.
He emphasized that Trump had not made any remarks regarding the FT report, while also noting that all major U.S. cloud computing firms maintain contracts with the U.S. government.
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The U.S. has intensified efforts in recent years to limit China’s access to cutting-edge semiconductors essential for training artificial intelligence models.
“The rapid decline in Alibaba’s stock price following [the FT report] indicates how apprehensive China’s AI sector is regarding potential new sanctions,” stated Kyle Chan, a Brookings fellow specializing in China technology.
Alibaba’s shares had closed down 3.78% in the U.S. on Friday after the report, but saw an increase of over 1% in Hong Kong on Monday.
Chan highlighted that the FT report emerges as Alibaba’s open-source Qwen AI model is gaining traction in Silicon Valley, posing a threat to the subscription-based models from U.S. AI firms like OpenAI and Anthropic — while investors grow increasingly concerned about a potential AI bubble.
Alibaba is scheduled to announce its quarterly results on Nov. 25, ahead of the U.S. market opening.
—CNBC’s Eamon Javers and Elaine Yu contributed to this report.
