Chinese tech giant Alibaba unveiled its new artificial intelligence reasoning model on Thursday, claiming it outperforms rival models from OpenAI and DeepSeek. This announcement led to an 8% increase in Alibaba’s Hong Kong-listed shares and boosted the Hang Seng’s China Enterprises Index.
The launch of Alibaba’s new AI model follows the introduction of a “general AI agent” called Manus by another company. A promotional video for Manus highlights its ability to perform complex tasks such as screening resumes and building websites. Manus, developed by the Chinese company Monica, is marketed as being more advanced than a traditional chatbot by not only generating ideas but also producing tangible results like reports that recommend properties based on specific criteria.
Alibaba’s new model, named QwQ-32B, was described in an online statement as offering “exceptional performance,” surpassing OpenAI’s o1-mini and competing closely with the powerful DeepSeek-R1. The company highlighted that the model had achieved significant advances in mathematics, coding, and general capabilities, matching the performance of DeepSeek’s R1. Alibaba’s model has 32 billion parameters, compared to DeepSeek’s R1 with 671 billion parameters, suggesting Alibaba’s model is smaller and more efficient to train.
In January, DeepSeek made waves with its R1 model, which was praised for performing well at a fraction of the cost compared to Western rivals. This success has boosted confidence in Chinese companies’ ability to innovate amidst the growing US-China tech rivalry, with the Hang Seng China Enterprises Index climbing more than 30% since January.
Alibaba, the parent company of popular Chinese e-commerce platforms Taobao and Tmall, first launched its own ChatGPT-style service, Tongyi Qianwen, in 2023, after OpenAI’s industry-leading AI model was released. Earlier this year, Alibaba also introduced the Qwen 2.5 Max model, claiming it outperformed DeepSeek’s V3 model, which had just been released.
Last week, Alibaba announced plans to invest 380 billion yuan ($52.4 billion) into its AI and cloud computing infrastructure over the next three years, exceeding its total investment in these areas over the past decade. Chinese leaders also expressed support for emerging technologies, including AI, humanoid robots, and quantum computing.