Alibaba plans Hong Kong IPO for AI chip unit T-Head

Alibaba plans to spin off its AI chip unit, T-Head, and list it in Hong Kong. The parent company intends to keep control after the deal.

The offering is targeted for 2027. It is anticipated to raise between US$2 billion and US$3 billion, or approximately HK$15.6 billion to HK$23.4 billion, with Alibaba retaining majority control once shares start trading.

What T-Head actually does

T-Head, also known as Pingtouge, designs chips built around AI workloads. Its lineup includes server CPUs and RISC-V processors.

The unit was founded in 2018. It came together by merging C-SKY Microsystems with the chip team from DAMO Academy, Alibaba’s research arm.

The business has moved past the science-project phase. T-Head has shipped more than 470,000 chips, according to figures cited by CEO Eddie Wu.

Revenue tells a similar story. The unit’s annualized revenue exceeded RMB 10 billion as of early 2026.

The Zhenwu V900 and the road to listing

In September 2026, T-Head unveiled its Zhenwu V900 AI chip. The company is promoting it as the most powerful chip in China.

The V900 is said to deliver three times the computing performance of its predecessor, the M890. It also supports clusters of up to 500,000 chips working together.

Mass production of the V900 is slated for the first quarter of 2027. That lines up neatly with the targeted IPO window.

The listing plan did not appear out of nowhere. Talk about a possible exit route for T-Head from its parent dates back to at least January 2026.

That same month, Bloomberg reported plans to restructure T-Head into a partly employee-owned entity.

Why Alibaba wants a separate listing

Spinning off a unit while keeping control is a well-worn corporate maneuver. It lets a parent unlock the value of a fast-growing division without giving up strategic direction.

A standalone listing hands T-Head a public valuation, a currency for hiring and acquisitions, and direct access to capital markets.

Raising US$2 billion to US$3 billion from outside investors spreads that financial load. Alibaba still gets to steer the ship.

What this means for investors and the market

Analysts foresee a standalone valuation for T-Head ranging from US$25 billion to US$62 billion.

Alibaba is likely to remain both T-Head’s controlling owner and an important customer, which raises questions about pricing and priorities between the two.

The V900’s mass production is scheduled for the first quarter of 2027, and any slip in that timeline could weigh on how investors view the offering.

Several milestones are worth tracking from here. These include formal filing details, the final size of the raise, how the employee ownership structure takes shape, and whether V900 production stays on schedule.