Michael Burry Says He 'Flipped' His Alibaba Stock into JD and Won't Be Flipping Back — Hong Kong-Listed Stock Falls Nearly 10% on $10B Raise

Investor Michael Burry said he has no plans to move his stake back to Alibaba Group Holding Ltd. (NYSE:BABA) from JD.com Inc. (NASDAQ:JD), after the Chinese e-commerce giant’s $10 billion share sale to fund its artificial intelligence ambitions sent its Hong Kong-listed shares tumbling nearly 10%.

A New Paradigm He Won’t ‘Bless’

“I moved my entire Alibaba position into JD not too long ago. This greatly increased my JD position. I planned to move most of it back after a month or two. No longer,” Burry said in a post on Substack. “Alibaba would have to fall by half for me to get interested again.”

On X he said the share sale marks “a new paradigm again for BABA,” and that its return on invested capital will “continue to fall” as a result.

Still, ‘The Big Short’ investor said Alibaba is “making serious inroads” in the low-cost AI model race in the U.S., calling it “impressive as a disruptive force” that he expects to continue.

A $10 Billion Bet On AI

Alibaba on Sunday said it will raise HK $80 billion ($10.2 billion) by offering 710 million Hong Kong shares at a 3.6% discount to fund its AI investments, days after reporting that capital expenditure jumped to $10 billion in the June quarter as chip prices rose.

CEO Eddie Wu said Alibaba’s “full-stack AI strategy” positions the company “to capture the substantial growth of demand for artificial intelligence and AI compute.”

Still Bullish On China’s ‘Delivery Wars’

In June, Burry added to his Alibaba position as part of a broader bet on beaten-down tech stocks.

He said he still believes China’s “Delivery Wars” will ease into less cutthroat competition and higher margins, a shift he said “will most likely change the narrative for JD and Meituan.”

China’s AI push has been gaining real momentum, with domestic developers narrowing the gap with U.S. rivals on both model performance and adoption, even as heavy spending and looser corporate governance around funding new projects raise fresh questions for investors.

Hong Kong-listed Alibaba shares have fallen 17.45% so far this year and 1.20% over the past year. On Monday morning, the stock fell 9.92% to HK$110.80 ($14.44).

Price Action: The ADRS fell 8.57% on Friday to close at $119.34 and fell 0.28% in extended trading.

Benzinga edge rankings indicate Alibaba’s stock has a Momentum score in the 25th percentile and a Growth score in the 92nd percentile.

Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.

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