NEW YORK, Feb 20, 2026, 05:44 EST — Premarket
Alibaba Group Holding Limited’s U.S.-listed shares (American depositary receipts, or ADRs) were down about 0.9% at $154.27 in premarket trading on Friday, after ending the prior session at $155.70.
The early move comes as investors return to Hong Kong markets after the Lunar New Year break and risk appetite stays shaky, with oil rising after U.S. President Donald Trump set a 10-to-15 day deadline for Iran to reach a nuclear deal. Hong Kong’s Hang Seng slipped 0.6% with selling heaviest in e-commerce and technology shares. (Reuters)
In Hong Kong, Alibaba’s shares fell 3.75%, among the bigger drags on the benchmark, while Baidu slid 5.67%, a Reuters market report showed. (Business Recorder)
Some investors have been rotating into newly listed “pure AI” stocks and trimming big internet platforms. “Money is rotating into pure AI names, while diversified platforms like Alibaba and Tencent are seeing some profit-taking,” said Billy Leung, an investment strategist at Global X Management. “Investors are increasingly scrutinising how quickly their AI initiatives can contribute meaningfully to earnings,” said Dilin Wu, a research strategist at Pepperstone Group. (The Edge Malaysia)
Adding to the pressure, Erste Group cut Alibaba to “hold” from “buy,” citing falling operating margins — profit as a share of sales — and rising long-term liabilities. Analyst Hans Engel pointed to the cost of Alibaba’s push to monetise AI through cloud services and proprietary chips as a key swing factor for the stock. (Investing)
Politics has not helped. The Pentagon briefly posted an updated Section 1260H list of firms it alleges aid China’s military earlier this month, then withdrew it; Alibaba and Baidu were among the additions, Reuters reported. “Alibaba is not a Chinese military company nor part of any military-civil fusion strategy,” an Alibaba spokesperson said. (Reuters)
Alibaba has tried to cast itself as an AI winner. On Feb. 16, it unveiled Qwen3.5 and pitched it as built for the “agentic AI era,” as it battles for users with ByteDance’s Doubao in China. (Reuters)
But sentiment can flip fast if investors conclude AI spending will pinch margins before it lifts revenue, or if Washington’s stance hardens. Chinese tech names have also been hit by concerns that outsized AI outlays could crimp profitability, a theme that has dented some U.S. peers in recent weeks. (Investing)
Next up, traders will focus on Nvidia’s quarterly results on Feb. 25, widely watched as a read-through on AI spending, with the chipmaker set to host an earnings call at 5 p.m. ET. (NVIDIA Newsroom)
