Alibaba's core e-commerce business is showing clear signs of stagnation, with no meaningful growth and a sharp decline in profitability. The local life services segment continues to bleed cash, and the growth it generates through subsidies is unsustainable, with projections indicating a slide into negative growth by 2027.

The AI large model sector remains largely a narrative play, with no viable path to profitability unless competitors are effectively eliminated. However, every major tech player entering the AI arena possesses substantial resources, while startups can secure virtually unlimited funding before going public, ultimately cashing out through retail investors post-IPO. This makes it exceedingly difficult to outmaneuver any rival in this space.

Investors should be wary: the $80 billion fundraising initiative is merely the beginning. Given that Alibaba's core operations are not generating sufficient profits to support its AI expenditures, equity financing appears to be the only viable route forward.

From a strategic standpoint, long-term investors are advised to steer clear of Alibaba. On Monday, the Hong Kong-listed shares of the company are expected to open significantly lower. If the stock does not experience a substantial gap down, investors should utilize the 9:20 AM call auction period to adjust positions, as a decline is inevitable—it is only a matter of timing.