Why Alibaba Was Outpacing the Broader Stock Market Today

Key Points

• The man behind Alibaba's now-powerful cloud unit gave an interview to Bloomberg.

• In it, he expressed a few rather counterintuitive views on the future of artificial intelligence (AI).

• 10 stocks we like better than Alibaba Group ›

A top figure at Alibaba (NYSE: BABA) basically reiterated the company's commitment to artificial intelligence (AI) technology over the weekend, and on Monday, the stock market rewarded the company for this. Shares of the Chinese e-commerce and tech giant were rising by nearly 2% in mid-session trading that day, easily topping the 0.2% slump of the S&P 500 (SNPINDEX: ^GSPC) during that time.

Not so-cloudy vision

Wang Jian, the founder of Alibaba's powerful cloud computing unit, gave an extended interview to Bloomberg that was posted on Sunday. In it, he spoke extensively about what he considers to be the future of AI.

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Image source: Getty Images.

In Wang's opinion, many people currently have unrealistic expectations of what the technology can do. Much of this, he believes, is due to the emergence and early prominence of OpenAI's ChatGPT, which has focused attention on next-generation chatbot technology. He feels that AI has vastly more potential than that, and that the present level of development will soon be eclipsed.

"Probably 90% of the AI people are talking about, I would say, will go away in five or 10 years because it's not really the essence of this technology," Wang said to the financial news service.

He opined that developers working on AI applications and processes have to look behind the present hype and chatter in order to determine how the technology could be harnessed for true advancement.

Soaring AI ambitions

While Wang didn't provide granular details of how Alibaba might approach AI going forward, his pronouncements were sensible and realistic, and they obviously struck a chord with investors. Alibaba has the resources, know-how, and financial muscle to be a top AI developer. As such, investors should keep an eye on what comes from its development in the technology.

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Eric Volkman has no position in any of the stocks mentioned. The Motley Fool recommends Alibaba Group. The Motley Fool has a disclosure policy.