Apple Picks Alibaba Over DeepSeek as its Partner for Apple Intelligence in China

Apple Inc. (NASDAQ: AAPL) is reportedly entering a significant partnership with Alibaba (NYSE: BABA) to introduce its Apple Intelligence platform in China, marking a pivotal shift in its strategy for the region.

This move comes after unsuccessful discussions with AI startup DeepSeek and Bytedance. Initially, Apple sought collaboration with Baidu, but technical challenges impeded progress.

The absence of Apple Intelligence in China has been a factor in an 11% decline in iPhone sales, as domestic competitors like Huawei continue to gain market share. The collaboration with Alibaba is aimed at bolstering Apple’s presence in China, particularly with the anticipated launch of the fourth-generation iPhone SE.

Apple Seeks to Reverse iPhone Sales Slump in China with Apple Intelligence

The decision to partner with Alibaba is a strategic response to declining iPhone sales in China. With an 11% drop in sales, Apple has felt the pressure from local competitors such as Huawei, which have seized the opportunity to capture a larger market share.

By introducing Apple Intelligence through Alibaba, Apple aims to regain its footing in the Chinese market. This partnership is expected to enhance the appeal of Apple’s products and services, potentially reversing the downward sales trend. The upcoming release of the iPhone SE is seen as a critical opportunity for Apple to reinforce its market position.

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Apple Stock and Alibaba’s US-Listed Shares Gain

Apple’s stock has shown positive movement in recent trading sessions. As of February 11, 2025, the stock opened at $228.20 and reached a high of $235.23, with a current price of $234.80. This represents a notable increase from the previous close of $227.65. The stock’s 52-week range has seen a low of $164.08 and a high of $260.10.

Analysts maintain a “buy” recommendation, with a target mean price of $252.23. The market has responded favorably to Apple’s strategic moves, reflecting optimism about the company’s future prospects in the Chinese market.

Alibaba’s stock has also experienced an upward trend, with a current price of $113.76, up from a previous close of $111.32. The stock opened at $113.96 and reached a high of $115.53 during the trading day. Analysts have expressed a positive outlook for Alibaba, maintaining a “buy” recommendation with a target mean price of $119.98. The stock has seen significant growth from a low of $81.68 in January 2025.

Disclaimer: The author does not hold or have a position in any securities discussed in the article. All stock prices were quoted at the time of writing.