Alibaba Cloud plans to use fewer Western chips, to boost its already huge AI margins

Alibaba has revealed margins from its cloudy AI operation are rising so quickly it will be able to achieve return on investment for new hardware purchases faster than previously planned. Speaking on the company’s earnings call yesterday, CFO Toby Xu said the company runs its servers for five years, and that AI servers produce enough revenue to cover their costs in three years. In the fourth and fifth years of a server’s life, the machines therefore generate free cash flow. CEO Eddie