Morgan Stanley China CIO Survey: Significant increase in B-end interest in Qianwen and Alibaba Cloud, expected to surpass DeepSeek in three years

The Chinese enterprise-level AI market is undergoing a structural transformation from "model tasting" to "cloud-based practical application," and Alibaba may become the "biggest winner" in this transformation.

On November 27, Morgan Stanley released its latest CIO (Chief Information Officer) survey report for the second half of 2025. Morgan Stanley found that as IT budgets continue to expand in 2026, enterprise customers are rapidly shifting from independent model developers to hyperscale cloud vendors with full-stack capabilities in the deployment of generative AI.

In this reshaping of the landscape, Alibaba, with its combination of "cloud foundation + Tongyi Qianwen," has been established by Morgan Stanley as "China's best AI enabler." Morgan Stanley's analysis indicates that Alibaba's appeal in the B-end is quickly approaching and is expected to surpass the currently popular DeepSeek within three years.

Cloud Giants Surpass "Model Startups"

The most critical marginal change in this survey lies in the shift in B-end customer selection logic.

As AI applications move from experimentation to large-scale deployment, 47% of CIOs now prefer to choose hyperscale cloud vendors to support the implementation of large models, an increase of 10 percentage points compared to the first half of 2025. In contrast, interest in independent AI model developers has decreased by 7 percentage points to 40%.

This means that enterprise customers place greater importance on the deep integration of computing power infrastructure and models in deeper waters, rather than solely on the advantages of individual model algorithms.

Morgan Stanley pointed out that 40% of CIOs plan to deploy GenAI through public clouds in the next 12 months, significantly higher than the 28% six months ago.

This is undoubtedly good news for infrastructure giants like Alibaba Cloud.

Landscape Prediction: Tongyi Qianwen May Reach the Top

The B-end "dominance" of major model vendors is undergoing dramatic changes.

Morgan Stanley's survey shows that CIO interest in DeepSeek has dropped significantly by 20 percentage points, currently falling to 45%. Meanwhile, the intention for Alibaba/Tongyi Qianwen has surged from 18% in the first half of the year to 30%, showing the most rapid growth.

Based on the survey results, Morgan Stanley has provided a more aggressive endgame projection: Within three years, Alibaba/Tongyi Qianwen is expected to occupy the top position with a 37% share, surpassing DeepSeek (28%), Huawei (13%), and ByteDance (12%).

Currently, in the field of large models, Tongyi Qianwen's latest flagship model Qwen3-Max has entered the global top three; in C-end applications, the Qianwen App achieved over 10 million downloads in its first week; in academia, the Tongyi Qianwen team received the best paper award at NeurIPS (Conference on Neural Information Processing Systems), known as the "Oscar" of the AI field.

This dual-driven approach of "technology + application" is building Alibaba's moat in the B-end

380 billion capital expenditure may still appear "conservative"

The votes of CIOs are translating into tangible financial expectations for Alibaba.

As the leader in China's AI cloud market, Alibaba Cloud held a 35.8% market share in the first half of 2025 (Omdia data), surpassing the combined total of its second to fourth competitors.

Based on strong survey results, Morgan Stanley has given a very high expectation for Alibaba Cloud's growth curve:

• Accelerating revenue: It is expected that Alibaba Cloud's revenue growth rate will accelerate to over 35% in the second half of the 2026 fiscal year (F2H26), and further rise to 40% in the 2027 fiscal year.

• Hunger for computing power: Management revealed that Token usage doubles every 2-3 months. Morgan Stanley's analysis points out that even though Alibaba has planned a capital expenditure (Capex) of 380 billion yuan over three years, in the face of such exponential demand, this figure "may still be insufficient to meet current needs."

This means that Alibaba's future investment intensity and corresponding revenue conversion potential may exceed the current consensus expectations in the market.