Alibaba ADRs rise after Qwen secures role in Apple AI services in China

Alibaba’s U.S.-listed shares rose 4% in premarket trading on Wednesday after the Chinese technology group confirmed that its Qwen artificial intelligence model will be integrated into Apple services in China. The ADRs were last quoted 3.7% higher, according to CNBC, as investors assessed the commercial and policy significance of a Chinese AI model gaining a place inside Apple’s local software ecosystem.

An Alibaba spokesperson told CNBC that “Qwen will be integrated into Apple Intelligence experiences within iOS, iPadOS, macOS, and visionOS for users in China.” The spokesperson added that the integration would allow users to access Qwen capabilities, including text and image understanding and generation, without moving between separate tools.

Apple was approached for comment, CNBC reported.

The development follows approval from the Cyberspace Administration of China, which included Apple AI services on a list of authorised providers. CNBC reported that the list also included products from domestic companies such as Huawei.

For Apple, local approval is a key step in bringing Apple Intelligence features to Chinese users. The company first announced its AI offering in 2024, and the path to regulatory clearance in Beijing has taken place against a sharper technological rivalry between the United States and China, with both governments focused on artificial intelligence capabilities and control over critical technology supply chains.

How the integration works

Apple Intelligence is designed to embed AI functions across Apple’s operating systems rather than require users to open a separate chatbot or third-party application. By integrating Qwen into iOS, iPadOS, macOS and visionOS for China-based users, Alibaba’s model can support functions such as interpreting text or images and generating content inside Apple’s software environment, according to the Alibaba spokesperson’s description to CNBC.

The arrangement also reflects a broader requirement for foreign technology companies operating in China: AI services generally need to comply with local regulatory approvals, and overseas companies often work with Chinese partners to meet domestic rules and product expectations. CNBC reported that Apple’s AI services appeared on the Chinese regulator’s approved list alongside local providers.

AI policy tensions remain high

The Apple-Qwen news comes amid a series of recent developments showing how AI has become a point of commercial and political friction between Washington and Beijing. CNBC reported earlier this month that Alibaba barred employees from using Anthropic’s AI. CNBC also reported that U.S. lawmakers are examining ways to limit the adoption of Chinese AI models by American companies.

Separately, CNBC reported that Meta had been forced to unwind a $2 billion acquisition of Chinese company Manus after Beijing ordered the deal to be dismantled.

The Qwen model has also drawn attention from companies working on smaller AI systems that can run on consumer devices. CNBC reported that Apple is in talks with PrismML, a Silicon Valley company whose chief executive said it can compress powerful AI models enough to operate directly on an iPhone.

PrismML, a Khosla Ventures-backed spinout from the California Institute of Technology, publicly released compressed versions of Alibaba’s open-source Qwen model on Tuesday, according to CNBC. The company said it reduced the model from about 54 GB to less than 4 GB, allowing all 27 billion parameters to run on an iPhone 15 or newer.

This story draws on original reporting from CNBC.