This is the first reported case of Chinese company being harmed by the US’s ban on technology to China.

The Chinese e-commerce giant reported the move alongside its third-quarter earnings. The group reported an income from operations of $4.6 billion, up 34 per cent year-on-year, and revenue of $30.8 billion, up 9 per cent.

Alibaba warned US export restrictions could affect its business more generally by making it harder for the company to upgrade its existing hardware.

The company’s Cloud Intelligence Group brought in $3.789 billion in revenue, but earnings before income tax and amortisation was $193 million, up 44 per cent on the same period a year earlier. Cloud sales growth has stalled in 2023 as customers weigh up their spending.

Alibaba said that the expanded restrictions announced by the US in October may materially and adversely affect Cloud Intelligence Group's ability to offer products and services and perform under existing contracts, negatively affecting its operations and financial condition results.

“We believe that a full spin-off of Cloud Intelligence Group may not achieve the intended effect of shareholder value enhancement," the company added. "Accordingly, we have decided not to proceed with a full spin-off, and instead, we will focus on developing a sustainable growth model for Cloud Intelligence Group (CIG) under the fluid circumstances."