Alibaba’s $2 billion gaming exit signals where Beijing wants its money

Alibaba is getting rid of its video game development arm for more than $2 billion, removing the Chinese tech giant from the in-house game development space entirely as it looks to double down into the AI sector.

Alibaba has agreed to sell Lingxi Games, the studio behind the mobile hit Three Kingdoms: Strategy Edition, to private-equity firm Trustar Capital, Bloomberg reported. While the studio is reportedly valued between $1.5 billion and $2 billion, the companies have not publicly disclosed a price.

“Alibaba is handing Lingxi to Trustar due to better focus on its strategic priorities,” Lingxi CEO Zhou Bingshu wrote in an internal staff memo according to Reuters.

Some of those strategic priorities for Alibaba include AI and cloud computing, which currently sit at the center of Beijing’s economic strategy.

“It’s just cleaning up the cap table,” Rui Ma, a China tech analyst and founder of China-focused research platform Tech Buzz China, told........

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