Alibaba Cloud Leads $100M Bet On Chinese Startup Eyeing Humanoid Robot Market

Alibaba's cloud unit has led a $100 million investment round in Chinese robotics startup X Square Robot, CNBC reported late Sunday, further deepening its presence in the advanced technology sector.

Founded in 2023, X Square Robot is developing AI systems that enable robots to understand instructions and perform tasks autonomously. It has also debuted a wheeled humanoid robot, called Quanta X2, aimed at household, service, and industrial applications.

The company has raised $280 million to date and counts HongShan, formerly Sequoia Capital China, and food delivery giant Meituan among its investors, according to the report.

Alibaba has long embraced robotics and advanced hardware, deploying much of it to power its cloud services and e-commerce operations. Although the field of humanoid robots is still a developing area, the move suggests Alibaba's growing push into advanced technologies.

In recent years, the company has backed Unitree Robotics, another humanoid maker, and Deeproute, which develops software for autonomous vehicles, as well as made several small investments in tech startups. Meanwhile, Alibaba is also rolling out AI models at a fast clip, amid intensifying competition in the space in China.

As of late Sunday, the retail sentiment for Alibaba on Stocktwits was 'neutral.' BABA shares are up 61% year-to-date.

X Square Robot has also released what it calls an "open-source foundation model for embodied AI," named Wall-OSS. That means developers can use Wall-OSS for the robots' software.

The company's Chief Operating Officer, Yang Qian, told CNBC that AI for robots still lags behind advancements in generative AI for chat or code generation, and said that ChatGPT 3.5-type capabilities in robots might not be realized within the next 12 months.

Tesla's Optimus robot has been in the news recently. Although used only for internal tasks and as an attraction at Tesla events currently, Elon Musk has claimed that  80% of Tesla's future value will come from Optimus.

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