Chinese tech giant Tencent plans to add more AI features and products to help its business grow, after reporting strong results for the last part of 2024. Analysts think Tencent might even turn its popular WeChat messaging app into an AI-powered “super app” with many new features.

On Wednesday, Tencent’s top leaders, including Chairman Pony Ma and President Martin Lau, explained their AI strategy. They said AI is already helping their main gaming business by coaching new players and making online matches better. In advertising, AI is being used to understand customer behavior and show more targeted ads.

Thanks to these improvements, Tencent’s revenue rose 11% compared to the same time last year, reaching 172.4 billion yuan ($24 billion) in the last quarter of 2024. Profits jumped 90% to 51.3 billion yuan compared to the fourth quarter of 2023.

Tencent’s stock price in Hong Kong has gone up nearly 30% this year, as investors are excited about AI developments in Chinese tech companies. This excitement grew after DeepSeek launched a low-cost AI model in January that surprised even Silicon Valley. Tencent said it plans to spend more on AI, with capital spending expected to be a “low teens percentage” of its sales in 2025.

Previously, Tencent spent a “high single digit percentage” of its revenue on such investments, according to Charlie Chai, an analyst in Shanghai. Now, the company needs more powerful chips called GPUs, which are used to process AI data.

In the last quarter, Tencent’s capital spending soared 386% year-on-year to 36.6 billion yuan as it bought more semiconductors. Executives said they might need even more computing power this year.

Tencent is also facing tough competition at home. Other big Chinese tech companies like Alibaba and ByteDance are offering AI chatbots and assistant apps, often free, to attract users. Last week, Alibaba launched its Quark AI assistant, and in February, it said it would invest at least 380 billion yuan over the next three years in cloud computing and AI technology.

Tencent is promoting its Yuanbao AI assistant app. This chatbot uses TeAI Productsncent’s own Hunyuan model and DeepSeek’s R1 model. It can answer questions, search the web, summarize information, and even take voice calls. In February, it was China’s fifth most popular AI product, with 13 million monthly users, according to the ranking site aicpb.com.

But Yuanbao is just one way Tencent is trying to get more users. In February, they also added AI search features to WeChat, which has nearly 1.4 billion users. During a call with analysts yesterday, Tencent’s Lau said they might create a special AI assistant just for WeChat.

This AI assistant could connect with different mini-programs inside WeChat. These mini-programs let users shop, read, book flights, and play games without leaving the app. Lau said Tencent could “easily build” an AI assistant that can use these mini-programs to handle more complex tasks.

He didn’t say when these new products might be ready. Tencent plans to keep using its Hunyuan model and other outside models, since different AI models are good at different jobs, the company’s leaders said.

Their bigger goal might be to create an AI-powered “super app.” Among all Chinese tech companies, Tencent might be the best positioned to do this because it already has millions of users on different popular apps, says Shawn Yang, a senior analyst at Arete Research. Lau also said Tencent might add more AI features to its QQ messaging app, which has over 500 million monthly users.

“I think we’ll see more and more AI products,” Lau said. “And each product will keep getting better over time.”

Published: 20th March 2025

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