Alibaba Group Holding Ltd. (BABA) is pushing deeper into global AI infrastructure as it expands cloud capacity, develops new chips and explores additional European data centers despite mounting pressure from the cost of its investment spree.

The stock has lost nearly 30% in 2026, with AI capital expenditures weighing on profit margins alongside disappointing earnings reports and a heavily discounted $10.2 billion dilutive share placement.

Alibaba Explores Spanish Data Center

Alibaba has entered preliminary discussions with Spanish renewable-energy company Solaria about supplying electricity to a potential data center in Spain.

The talks remain at an early stage, and the companies have not reached a final agreement, China Daily reported Thursday.

Alibaba has also approached other potential power suppliers. The discussions come as Spain develops into a larger European data-center market, helped by its renewable-energy resources.

Cloud Expansion Broadens Global Footprint

Alibaba plans to establish its first cloud regions in Turkey, Finland and the Netherlands over the next 12 months.

The company also plans to add capacity in Malaysia, Germany, the United Arab Emirates, France and Hong Kong.

The expansion will allow Alibaba to offer more localized cloud and AI services while competing with Amazon.com, Inc. (AMZN) and Alphabet Inc. (GOOG) outside Asia.

Alibaba Targets 20-Gigawatt Network

CEO Eddie Wu has said Alibaba Cloud aims to operate more than 20 gigawatts of global data-center capacity by 2032 as demand for AI computing increases.

Citigroup estimates the network could support more than $160 billion in external cloud revenue.

Alibaba announced a $53 billion, three-year AI investment program in 2025 and has signaled that capital spending will continue to rise.

Joe Tsai Makes Case For European AI Infrastructure

Alibaba Chairman Joe Tsai also sees an opportunity for Europe to build more of its own AI infrastructure.

Tsai said Europe should increase its computing capacity and embrace open-source AI to reduce dependence on U.S. and Chinese technology providers, Bloomberg reported Wednesday.

He also pointed to Europe's industrial data and growing neocloud sector as potential advantages. Tsai said locally based infrastructure could allow European companies to train and operate AI models using their own data.

Analysts Maintain Bullish Ratings

Alibaba carries a Buy consensus rating with an average price forecast of $191.

Susquehanna raised its Positive-rated forecast to $190 on Aug. 28. JPMorgan raised its Overweight-rated forecast to $210 on Aug. 21, while Barclays lifted its Overweight-rated forecast to $200 the same day.

ETF Exposure Adds Trading Sensitivity

Alibaba carries a 2.40% weight in the Schwab Emerging Markets Equity ETF, 4.48% in the Pacific NoS Global EM Equity Active ETF and 7.77% in the Invesco Golden Dragon China ETF.

Significant inflows or outflows from funds with large Alibaba positions can translate into corresponding buying or selling of the stock.

BABA Price Action: Alibaba shares were up 0.78% at $107.83 during premarket trading on Thursday, according to market data.