MiniMax expands Alibaba cloud pact as compute needs surge for training and inference

MiniMax's dramatic increase in cloud spending with Alibaba, particularly the 220 percent jump to a US$1.2 billion ceiling and the nearly 20-fold rise in API services to US$62.5 million, points to the intense compute demands of China's leading AI developers. Burning through two-thirds of its annual budget by June underscores the rapid scaling required for both training large language models and supporting live inference for applications like Hailuo AI. This growth is further evidenced by MiniMax's 283 percent revenue surge in the first half, driven by a 700 percent leap in enterprise sales. The reliance on Alibaba Cloud for such substantial compute power also highlights the strategic importance of domestic cloud providers in China's AI ecosystem. While MiniMax's rapid expansion is impressive, the sheer cost of compute power remains a critical factor for profitability and sustained growth in the highly competitive Chinese AI market. The ability to manage these escalating infrastructure costs will be key for firms like MiniMax to maintain their trajectory.