Shares of Alibaba Group Holding Ltd. declined sharply on Monday following a report that the US government has raised concerns over a possible partnership between the Chinese tech giant and Apple Inc., Bloomberg reports.
The news triggered a drop of up to 4.8% in Alibaba’s Hong Kong-listed stock, making it one of the biggest losers on the Hang Seng China Enterprises Index.
According to a report by The New York Times, the Trump administration and congressional officials have been reviewing Apple’s potential plan to incorporate Alibaba’s artificial intelligence technology into iPhones sold in China. The report, citing unnamed sources familiar with the discussions, indicated that national security implications are a key concern behind the scrutiny. Apple, Alibaba, and the White House declined to comment on the matter.
The development marks another setback for Alibaba, which has been under pressure in recent sessions after its latest earnings report fell short of market expectations. The company’s revenue miss came as a disappointment to investors who had previously viewed Alibaba as a leading player in China’s AI resurgence, particularly amid excitement surrounding models inspired by DeepSeek technology.
In February, Alibaba Chairman Joseph Tsai stated that Apple’s iPhones would begin utilizing the company’s AI, helping to fuel a surge in Alibaba’s stock at the time. The renewed focus from US officials, however, has dampened that optimism, reflecting broader tensions between Washington and Beijing over technology partnerships and data security.
