It has no body, metabolism or reproductive capability. It's a process, not an entity.
E.g. all "atoms" of a glider in Conway's Life get replaced every couple turns but an observer can tell it is still a glider because it keeps the shape, and it the same glider because it continues it's previous state.
This makes AI not quite alive because it's missing the continuity.
In a tortured semantics sense sure, but in a practical sense they refer to different types of things.