Tencent Steps Up AI Effort, Exceeds Forecasts

“Tencent Holdings maintained double-digit profit and revenue growth, ending 2025 on a high note as the Chinese tech giant ramped up its artificial-intelligence efforts to stay ahead amid relentless competition in China.

 

The WeChat operator, China's largest company by market capitalization, said fourth-quarter net profit rose 13.5% from a year earlier to 58.26 billion yuan, equivalent to $8.46 billion.

 

Revenue climbed 13% to 194.37 billion yuan. Both figures beat market expectations, marking the fifth straight quarter of double-digit growth.

 

The strong results capped a year of solid growth for the company, coming as it is raises its AI game. Previously focused on leveraging AI to boost productivity and reduce costs across its businesses, Tencent has accelerated its efforts in recent months, establishing a new AI division, aggressively marketing its AI app to drive adoption and launching new AI products.

 

Tencent last year hired Yao Shunyu, a former researcher at ChatGPT maker OpenAI, to lead the company's AI infrastructure efforts, including the development of large language models. Then it joined domestic peers such as Alibaba and ByteDance in offering steep incentives to attract users to their AI tools during the Lunar New Year break.

 

This month, after OpenClaw, the open-source AI assistant, became a hit in China's tech community, Tencent released a series of OpenClaw-like AI agent tools to capitalize on the hype and integrate them in its ecosystem.

 

Chairman Pony Ma highlighted OpenClaw's flexibility and efficiency on the earnings call, saying that the agentic AI assistant allows Tencent to leverage its ecosystem strength to compete on multiple fronts.

 

OpenClaw also has shown Tencent that every mini-program within WeChat could be AI-enabled, he said.

 

The market has cheered the product launches, sending Tencent's stock up 7.3% in a single session earlier in March, its biggest jump in a year.

 

Still, Tencent shares remain about 8% lower this year after falling nearly 10% in the three months ended December. Despite the company's recent streak of robust earnings, investors are concerned it is falling behind in China's increasingly competitive AI market.

 

Investors "worry that Tencent could be challenged by the rising AI chatbots, agentic applications and AI phones on the consumer end," Citi analysts said in a research note. "Its enterprise cloud also seems to be growing slower than peers like AliCloud and ByteDance's Volcano."

 

As agentic AI takes center stage in the AI revolution, Chinese companies are racing to get ahead in this new battleground. The latest advancement in AI technology enables autonomous decision-making, allowing tasks to be initiated and completed without human intervention.

 

Tencent will at least double its AI investment in 2026 after spending 18 billion yuan last year, President Martin Lau said.” [1]

 

1. Tencent Steps Up AI Effort, Exceeds Forecasts. Qin, Sherry.  Wall Street Journal, Eastern edition; New York, N.Y.. 19 Mar 2026: B4.