Alibaba is looking to raise $3.2 billion through the sale of zero-coupon convertible bonds.

As reported by Reuters, the funding will be used for Alibaba's international expansion and to "strengthen" its cloud computing business.

Alibaba has said around 80 percent of the proceeds would be used to expand its data centers, upgrade technology, and improve its cloud computing services. The remaining 20 percent would go towards "enhancing market presence" and its e-commerce ventures.

The notes will mature on September 15, 2032, and will convert into Alibaba's US listed shares.

In Alibaba's recently posted quarterly earnings, the company's "Cloud Intelligence Group" saw a total revenue of $4.662bn, up 26 percent Year-on-Year (YoY). Within that, Alibaba said that AI-related revenue "maintained triple-digit year-over-year growth" - a rate it has maintained now for eight consecutive quarters.

Compared to US hyperscalers, this puts Alibaba in joint second place in terms of cloud growth - with Google Cloud revenue increasing 32 percent YoY in its most recent quarter, Microsoft 26 percent, and Amazon Web Services 17.5 percent, though the latter pair both have much higher revenue in absolute terms.

In China, a recent report from Omdia said that Alibaba holds more than a third of the AI cloud market. As reported by SCMP, Alibaba Cloud held a 35.8 percent market share. In second place was ByteDance's Volcano Engine with just 14.8 percent.

Alibaba has been expanding its cloud services significantly in recent months, with a particular push on international markets. The company launched a third data center in Malaysia in July 2025 and a second data center in South Korea in June 2025. Other locations include a new region in Mexico and a second data center in Thailand.

The company intends to spend around $52.7bn in establishing a "unified global cloud network."