Alibaba plunges $20 billion over US-China chip war

Alibaba Group Holding Ltd. has reversed its plans to spin off and list its $11 billion cloud business due to the escalating fight between the US and China for technological dominance. The company cited the US’s increasing restrictions on chip sales to China as a reason for the strategy reset. The decision has caused Alibaba’s shares to slide 9.1% in New York trading. The company is also facing challenges from the Covid-19 pandemic, a tech industry crackdown in China, and competition from other platforms such as PDD Holdings Inc. and ByteDance Ltd’s Douyin.

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