Alibaba has unveiled its latest AI chip, the Zhenwu V900, developed by the company’s semiconductor subsidiary T-Head.

According to Alibaba CEO Eddie Wu, the chip delivers three times the performance of its predecessor, the M890, which was released by the company in May, and can be linked in clusters of up to 500,000 in order to train and run large AI models.

The chip also has more memory and higher bandwidth, Wu said, although none of the claims about the processor's performance have been independently verified. Alibaba expects "significant growth in annual AI chip shipment volumes,” Wu added.

The Zhenwu AI chip is scheduled for mass production and commercial release in the first quarter of 2027.

In addition to unveiling the Zhenwu V900, Alibaba announced plans to expand its cloud capacity to more than 20GW by 2032.

However, despite claiming that AI customer demand was “extremely robust,” Wu acknowledged that supply chain constraints are likely to have an impact on how quickly the company can bring the capacity online, noting “the industry's mid-to-long-term demand far outpaces our supply capabilities.”

Wu’s comments echo those he made during Alibaba’s Q2 2026 earnings call in August, when he told analysts that the company remains confident about its AI and cloud business and expects to see profit and gross margins increase as it "ramp[s] up deployment of our own proprietary chips in our data centers, as they account for an increasing proportion of total chips and replace commercially procured chips."

On that same call, Wu told analysts that the company was confident it would achieve $15bn in external cloud revenue by 2030, and achieve a gross margin of 20 percent. For Q2 2026, Alibaba posted revenue of $7.139bn for its AI and cloud products, up 45 percent Year-on-Year.