Earnings reports from Chinese giants raise concerns! Is it a good time to buy on dips？
騰訊控股2025Q4及全年業績直播（即時傳譯）
Key Takeaways (AI-Generated)
财务表现
- 2025年第四季度总收入1944亿元人民币，同比增长13%
- 毛利润1083亿元人民币，同比增长19%
- 非国际财务报告准则经营利润695亿元人民币，同比增长17%
- 非国际财务报告准则归属股东净利润647亿元人民币，同比增长17%
业务进展
- 国际游戏业务年收入首次突破100亿美元
- 视频号总使用时长增长超20%，推荐算法升级
- 腾讯云实现调整后经营利润50亿元人民币，规模化盈利
- AI在游戏内容开发、用户参与和营销效率方面贡献显著
下一季度业绩指引
- 预计2026年混元、元宝等新AI产品投资将增加一倍以上
- 2025年第四季度AI投资70亿元人民币，全年180亿元人民币
- 提议年度股息每股5.3港元，同比增长18%
- 2026年收入增长可能快于利润增长，因加大新AI产品投资
机会
- 云业务在国际市场收入加速增长，合作伙伴关系扩展
- 开发基础模型、聊天机器人、编程等AI能力
- AI部署提升内容制作、用户获取、广告定向等运营效率
- 深化与持牌金融机构和云客户的战略合作
Full Transcript (AI-Generated)
Operator
Good day and good evening. Thank you for standing by. Welcome to Tencent Holdings Limited 2025 Fourth Quarter Results Announcement Webinar. I'm Wendy Huang from Tencent IR team. At this time, all participants are in a listen only mode. After the management's presentation, there will be a question and answer session for participants who dial in by phone.
If you wish to ask a question, please press 5 on your telephone to raise your hand. If you are accessing from the Tencent Meeting or Wu Meeting application, please click the Raise Hand button at the bottom left. And please be advised that today's webinar is being recorded.
Before we start the presentation, we would like to remind you that it includes forward-looking statements which are underlined by a number of risks and uncertainties and may not be realized in the future for various reasons. Information about general market conditions is coming from a variety of sources outside of Tencent.
This presentation also contains some unaudited non IFRS financial measures that should be considered in addition to, but not as a substitute for measures of the group's financial performance prepared in accordance with IFRS. For a detailed discussion of risk factors and non IFRS measures, please refer to our disclosure documents on the IRS section of our websites.
Now let me introduce the management team on the webinar. Tonight, our Chairman and CEO, Pony Ma will kick off with a short overview. President Martin Lau will provide a strategy review, Chief Strategy Officer, James Mitchell will provide a business review and Chief Financial Officer, John Lau will conclude the financial discussion. Before we open the floor for questions. I will now pass it to Pony.
Pony Ma
Thank you, Wendy. Good evening. Thank you everyone for joining us in 2025. We achieved high quality growth through our Evergreen products and services, increasingly support by applying AI capabilities.
We expanded our Evergreen game portfolio with the breakout success of Delta Force and reinforces our existing Evergreen games such as Honor of Kings and Peacekeeper Elite. AI contributes meaningfully to game content development, user engagement and marketing efficiency.
Video accounts total time spent increase over 20% on upgrade recommendation algorithm and enrich content ecosystem. Our marketing services revenue growth outperforms the industry, benefiting from our upgrade ad tech model and newly introduced automatic campaign solution, AI marketing Plus.
For Fintech, we sustained healthy revenue growth by deepening cooperation with the licensed financial institutions while maintaining prudent risk management. In cloud, we achieved profit as scale due to increased enterprise demand for our industry leading past and size products and supply chain optimization.
Internationally, our international games business the past ten billion U.S. dollars in annual revenue for the first time driven by sustained growth of Evergreen games and rapid expansion of content driven games. Our cloud revenue accelerated in international market as we expand partnership with key clients and drove higher adoption of our flagship cloud products.
The robust operating leverage and cash flow generated by our core businesses enable us to set up investment in AI. During the year, we upgrade our team with top tier AI tailor and build processes for improving foundation model intelligence in a systematic way. We began deploying new AI capabilities in services including Yuan, Bao and Weixin and core type products.
Looking at our financial numbers for the fourth quarter, total revenue was 194 billion RMB, up 13% year on year. Gross profit was 108 billion RMB, up 19% year on year. Non IFRS operating profit was 17 billion RMB, up 17% year on year and non IFRS net profit attributable to equity was 65 billion RMB, up 17% year on year. Now I will hand over to Martin.
Martin Lau
Thank you, Pony, and good evening and good morning to everybody on the call. I will share with you in this coming section on how we think about AI as the transformational force, starting with how resilient our existing business are in the context of AI, moving on to how we are deploying AI in our existing businesses to strengthen them.
Then discussing brand new products and opportunities made possible by AI and how we are investing in order to capture them. So first of all, I would like to talk about our key franchises are very resilient in the age of AI.
As we know, AI will affect every part of the technology industry, but some products and services are inherently more resilient than others. We believe that some of the characteristics of resilience would include network effects arising from consumer to consumer, consumer to content creator and consumer to business interactions in descending order of strength. That's number one.
Number two, deep supply chain integration linking the world's of bits with the world of atoms. Number three, stringent regulatory and licensing requirements. Number four, scarce or unique resources, including physical and intellectual properties. Number five, tick rates that are low compared to value provider or cost of switching, and number six, private data that is closed and interactive in nature.
Using these criteria, then we look across our major existing businesses. Our conclusion, which is supported by usage trends, is that each one of them has got a high degree of inherent resistance, in particular for our communication services, including Weixin QQ intensive meeting.
People use them to connect and interact with other people, largely their families, friends and colleagues and business partners. We believe this need for human interaction, together with the network effects and close nature of the data arising from these interactions have resulted in communication services being extremely sticky in the face of competing non AI services in the past and will continue to be resilient versus AI based services in the future.
Then moving on to our games, they are also very resilient as our multiplayer games, especially PvP games, also enjoy network effects. And similar to sports, they are team based in nature and players play with and against other players.
And just as people prefer to participate themselves or watch the teams they support compete in sports rather than watching AI sports, game players continue to enjoy the interaction with other humans that our games provide. Our games also cultivate strong IPS, and while AI will enable more games to be made faster, the game industry is already in a position of access supply with 200,000 new games on mobile and 18,000 new games released on Steam every year.
The limiting factor is that new games need to be high quality and more innovative than the best existing games, which in turn requires human creativity. On top of cutting edge technology, game is a natural beneficiary of AI proliferation. Also when people have more time at hand.
Fintech services is also resilient as it depend on difficult to secure and retain licenses which are limited in nature and also set the boundary on how innovations can be introduced in an industry. We've also invested decades building a payment network of difficult to replicate rails into partner banks, merchants and connecting them with more than a billion consumers, which brings it's own network effects.
And our mobile payment tick rates are already among the lowest in the world, which we believe makes competing with us on price highly uneconomical. Then we want to demonstrate that we are leader in strengthening our core businesses with AI.
When generated AI first emerged, we prioritized leveraging AI to reinforce our core businesses on the view that if we can strengthen them, we will be in a better position to invest in new products made possible by AI. And we believe that in each of our core businesses, we are now at the forefront of their respective industries in China and often globally in utilizing AI with positive initial results demonstrated by user engagement and revenue trends.
In games, we are deploying generative AI to accelerate in game content production, enabling us to produce more content within our big games. We're using generative AI to facilitate new user acquisition and existing user retention through measures such as targeted ads and personalized daily highlight reels.
We're enriching the core gameplay experience with AI features such as virtual teammates in PBP games and realistic non player characters in PBE games. These initiatives are one reason why Tencent games are more and more Evergreen and our revenue growth of 22% in 2025 outperformed the 7% growth of the global games industry.
For marketing services, we scaled up our advertising foundation model to provide more relevant ads to more targeted users, boosting ad conversions for advertisers and providing better user experiences. At the same time, we provide generative AI powered ad creative solutions and enabling advertisers to create more ads which are more relevant to smaller set of users and more efficiently.
We introduced our automated ad campaign solution, AIM Plus, under which advertisers can automate targeting, bidding and placement, improving their return on marketing investments and increasing their budget allocation to us. These initiatives contributed substantially to Tencent's marketing services revenue growth of 19% in 2025, outstripping the overall China ad industry growth of 14%.
For Video Accounts, deploying a longer sequence AI model, which captures more of a user's signals to enhance content recommendation, is boosting user growth, engagement and content distribution. Total time spent on Video Accounts increased more than 20% in 2025, and Video Accounts is now the second largest short video service by DAU in China.
For digital contents, we utilize AI in content production, improving production workflow efficiency and providing visually compelling special effects. AI also helps in content distribution through more intelligent content recommendations across music, videos and literature.
We're using AI in enterprise software to provide features such as AI agents that can take notes on and summarize concurrent meetings for users and AI agents that generate intelligence summaries of customer service history for merchants. Our enterprise software products Recom and Tencent Meeting are leaders in their categories in China in terms of usage and revenue.
For Fintech, we utilize lightweight AI models to enhance credit scoring processes and facilitate fraud detection, contributing to us sustaining better than industry non performing low rates. Now that our poor businesses are benefiting operationally and financially from integrating AI, we believe we are in a position of strength to add development of new AI products to our priorities.
At the foundation model layer, we see substantial opportunities from combining a strong foundation model with configuration for core user cases such as chatbot coding, multimodal and agentic applications. Although we're not the first mover in large language models, having already revamped our team, improved our data quality and rebuild our AI infrastructure for pre training and reinforcement learning, we're now iterating more intelligent models at a faster pace.
When Yuan three-point O's is in internal testing and currently represents a bigger step, I mean capabilities versus when Yuan two point O than two point O versus one point O for multimodal capabilities. Our 3D text to image and world models are early category leaders and will increasingly benefit from leveraging our proprietary data and abundant use cases.
Some observers in China tech are single mindedly focused on AI chat bots as the only means for bringing AI to users who believe. This mindset is overly simplistic because AI can help people in a multitude of ways beyond powering an information advice app who believe that AI chat bot application largely competing with search applications rather than with every other application.
For Yuanbao, our own AI chat bot app, we're focused on finding product, market fit and use cases which belong in Chat bot AI app. We're rapidly iterating Yuanbao to enhance it's user experience by providing better search integration, improved speech recognition, easier access to multimodal capabilities and exploration around group chat, which we believe will increase usage and user retention of the app in the coming months.
As we deploy Hun Yuan 3 Point O in Yuanbao, we believe the core user experience will step up further. In addition, we have also integrated AI to enhance a range of existing user experiences with innovation, including content consumption, information retrieval and merchandise recommendation and customer service.
We're building AI agents, which autonomously interact on behalf of users with innovation functionalities, especially mini programs. Excitement around claw bots illustrates that people recognize AI can unlock computer use capabilities to improve their daily lives, but also illustrate the risks around unleashing unsupervised AI.
We want AI agents invasion to deliver AI productivity that's beneficial to the general public as well as early adopters, and which will boost ecosystem activity and naturally generate revenue. AI agents are currently powered by a multiplicity of foundation models and we expect that users at the application level will continue to have access to the range of models.
However, improving the performance of when you will enable us to offer new unique to weation AGNT capabilities. So the weation and when you and teams will work increasingly closely together going forward.
Speaking of Clawbots, we have introduced a number of AI tools for enhancing productivity, including Work Buddy, Q Claw and Tencent Cloud Lighthouse, and we provide downloadable skills to easily put these tools to use from our skill hub. Clawbots are upgrading AI from thinking to do and be autonomous workflows and continuous task execution.
Users control this new generation AI tools through command line interfaces in their existing communication apps, which generally means Weixin and QQ in China. As it's in is the efficient for users to interact with digital agents in a place and format where they are already interacting with human context.
The new AI products that I described above required substantial and increasing investment, which we believe will generate significant return for us over the long run. Our spending on our two biggest new AI products when Yuan and Yuanbao was 7 billion RMB in the fourth quarter of 2025 and 18 billion RMB for the full year.
These figures are only for you when Yuan and Yuanbao and exclude AI initiatives supporting our existing products and services as well as exclude costs arising from providing GP use to external customers via Tencent Cloud. We expect to more than double these investments in Hun Yuan, Yuanbao and other new AI products in 2026, which we intend to fund from increasing earnings from our core businesses.
In this transformational, we are breaking out our investment in new AI products because we view these strategic investment conceptually similar to investment and affiliates or to CapEx. These are upfront investments required to build the necessary foundation to unlock new value as opposed to ongoing operating expenses.
As such, we believe the impact of these investments should be viewed separately from the profits generated by our existing businesses over time. We're confident that monetization will follow usage for these new AI products.
Lastly, I would like to present a case study on Tencent Cloud as the latest example on how we develop our services into market leaders with economic returns over time and that would follow games, payments and long form video and we expect it will be same for our new AI products.
Tencent Cloud was a relative late entrant in cloud services. However, we committed to a patient and long term investment strategy, believing that it had scaled from the start due to Tencent itself being the biggest single end user for a range of technology infrastructure in China and that it could provide differentiated services arising from Tencent's unique insights, ecosystem and capabilities.
For example, we believe that we were the first cloud service provider in China to fully recognize the stepped up capabilities of AMD's recent generations of CPU's, becoming AMD's largest partner in the country and that our cloud video streaming service is the industry leader in terms of streaming quality.
After a period where Tencent Cloud prioritized revenue growth somewhat misguided by other industry participants, in 2022, we aggressively restructured Tencent Cloud to focus on high quality services rather than chasing high revenue but low value added activities such as reselling and customizing projects.
This pivot cost us several quarters of revenue growth, but it enabled Tencent Cloud to achieve operating profit break even in 2024, up from significant losses in prior years. During 2025, although Tencent Cloud continued to face revenue headwinds due to limited availability of GPU for external customers as we prioritize our internal needs, it grew revenue and sharply improved earnings, achieving 5 billion RMB adjusted operating profit.
In recent months, we're seeing a better pricing environment, especially for memory and CPU, which along with robust AI demand and overseas expansion, allowing Tencent Cloud to grow revenue at a faster rate. Moving through the year, we have ordered a substantially higher volume of compute, which should also facilitate revenue growth.
Overall, we think Tencent Cloud is becoming another example of how Tencent competes on our own terms and pace and how our incubation investment cycle works. We view the initial losses in Tencent Cloud as a fixed sum of cash investment necessary to incubate a successful new business, but ultimately generating good economic returns. And we view the initial investment in new AI products Co name and AP in the same way. With that, let me pass to James.
James Mitchell
Thank you, Martin. For the fourth quarter of 2025, our total revenue was up 13% year on year. The AS represented 47% of our revenue within which the social network sub segment was 16%, domestic games 20% and international games 11%. Marketing services was 21% and fintech and business services 31%.
Our gross profit was up 19% year on year to 108 billion renminbi. The AS gross profit increased 21%, marketing services increased 22% and fintech and business services increased 17%.
Turning to business segments, value added service revenue was 90 billion renminbi, up 14% year on year. Our social network revenue grew 3% year on year to 31 billion renminbi driven by increased revenue from video accounts, live streaming and from music subscriptions.
Music subscription revenue increased 13% year on year on RP when subscriber growth. Long form video subscription revenue increased 1% year on year as video subscribers grew slightly year on year benefiting from the drama series Loves Ambition, the variety show Natural High Season 3 and the animated series Renegade Immortal. Each of these ranked first by video views in their respective genres across all video platforms in China.
For the quarter, domestic games revenue grew 15% year on year, primarily driven by Delta Force, the Valorant franchise and Weathering Waves. International games revenue increased 32% year on year, primarily driven by Supercells titles, PUBG MOBILE and Weathering Waves.
Moving to communications and social networks, we strengthened Weixin's commerce experience by upgrading features for users and tools for merchants in the mini shops. The upgraded e-commerce Gateway page allows users to check their shopping carts, see what friends are recommending and receive notifications from their favorite shops and generated substantial GMV during the quarter.
Through the new Likes for Discounts feature, users can discover products like by friends and receive and share discounts via the e-commerce Gateway page chats and moments. For mini programs, total user time spent increased over 20% year on year, driven by workplace Productivity Tools, mini games and novels.
We added Tencent code by D to our developer toolkit, enabling developers to create mini programs using natural language input. And we provided developers of AI native mini programs with free compute resources.
For domestic games, Delta Force sustained among the top three games in the industry in the quarter in February. During 2026, the game surpassed 50 million peak daily active users and achieved lifetime height monthly gross receipts. Delta Force leverages AI coding for development efficiency and deploys AI powered companions to enhance user engagement.
Batter and PC increased its gross receipts more than 30% year on year and achieved record high average DAU in the quarter, benefiting from the Flowers Meets Magic, Miss Bloomskins limited time roads and E sports events.
Valorant Mobile was the most successful new mobile game industry wide by gross receipts in 2025, bringing APC quality shooting experience and a distinctive art style that appeals to younger players. The game achieved lifetime high gross receipts in February as we released outfits to integrate traditional Chinese aesthetics with contemporary design.
In January we launched a sold Fire Future, a multi platform FPS game built on Unreal Engine, which has attracted several million Daus. Among our international games, Clash Royale ranked the third largest mobile game industry wide by DAU.
In the fourth quarter, it's average DAU in gross receipts more than tripled year on year, reaching lifetime highs. The game launched 10th anniversary events in March, including a limited time PvP mode with random modifiers powering up players cards, providing a more dynamic competitive experience.
Weathering Waves won the Players Voice awarded the game awards ceremony in 2025. In the fourth quarter, the game posted rapid year on year growth in gross receipts in DAU, driven by a new storyline, urban ruins, maps and new characters.
Warframe launched a major update, The Old Piece, featuring a new storyline, 2 new game modes and new Warframe. Uriel and its average DAU and gross receipts reached lifetime highs in December 2025.
For marketing services, revenue increased 17% year on year to 41 billion RMB. We experienced rapid growth from the Internet services and local services categories, partially offset by slower growth from the e-commerce category due to platforms temporarily shifting budget from marketing to subsidies and also from the financial services category due to the policy due to the impact of policy changes affecting online lending.
During the quarter, growth drivers included improved ad targeting, expanding our closed loop marketing services and tailoring ad formats for specific advertiser use cases such as ads that are playable previews of the mini games being advertised.
Entering 2026, we've deep in collaboration with e-commerce platforms facilitating their merchants advertising within Tencent and we've increased the inventory for rewarded video ads and video accounts, which have contributed to faster year on year marketing services revenue growth in the first quarter quarter to date versus in the fourth quarter of last year.
At a product level, video accounts total time spent increased due to upgrades to the content recommendation algorithm enabling faster growth in AD impressions. While our ad load remained lower than peers, better conversion rates contributed to more marketing spending for mini shops, merchants.
For mini programs, consumers engaging more with mini games and mini dramas attracted more marketing spend from the mini game and mini drama studios and Weixin Search. Overall, query volume grew at a rapid rate due to AI enhancements to search results driving growth in commercial query volume, while search pricing also increased.
On fintech and business services, segment revenue was 61 billion REMP, up 8%. We grew Fintech services revenue by a single digit percentage year on year and Fintech gross profit at a higher rate driven by wealth management and commercial payment services.
Commercial payment volumes sustained positive year on year growth, supported by a higher number of transactions and a narrow decline in value per transaction. For wealth management, which is the second biggest contributor to Fintech revenue, average assets per user and number of users each increase year on year.
Turning to business services revenue in the fourth quarter grew 22% year on year driven by higher cloud services revenue and increased technology service fees generated from higher mini shops e-commerce transaction volumes.
Our cloud services revenue accelerated its year on year growth rate due to increased demand and a better pricing environment amid tight supply of memory and CPU. Industry wide revenue from our cloud media services grew notably as short video platforms and AI video generation services are increasingly using our media processing solutions for streaming video and audio processing in the cloud to play back on device, reflecting our industry leading streaming quality and our competitive pricing. And now I'll pass to John.
John Lau
Thank you, James. Hello everyone for. 40 Four 2025 Total revenue was 194.4 billion renminbi, up 13% year on year. Gross profit was 108.3 billion RMB, up 19% year on year. The gains were 1.3 billion RMB compared with other gains of 2.5 billion R.E.M. and B in the same period last year due to lower subsidies and tax rebates.
Operating profit was 60.3 billion R.E.M. and B, up 17% year on year. Interest income was 4.8 billion REMB, up 22% year on. Growth in part by growth in cash reserves. Finance costs were 3.6 billion RMB compared with 2.5 billion RMB in the same quarter last year primary. 4X lost this quarter versus 4X gained in the same quarter last year.
Share product of associates and joint venture was 6.8 billion renminbi compared with 9.3 billion renminbi in the same quarter last year. On an IRS basis, share profit was 9.1 billion renminbi, up from 7.7 billion renminbi in the same quarter last year, with the increase from the performance of certain domestic associates due to operational efficiency. And business growth, income tax expense increased by 7% year on year. 12.5 billion RMB
On a non I virus basis started to EPS was .966 RMB, up 18% year on year, outpacing on Ivr's net profit growth due to reduced share count of share buybacks. On Q4 non Ivaris financial figures operating probable 69.5 billion RMB, up 17% year on year. Net profit attributable to equity holders was 64.7 billion RMB, up 17% year on year.
Moving on to gross margin, for the fourth quarter, overall gross margin was 56. 6%, up three percentage points year on year by segment. Last gross margin was 60% of 4 percentage points year on year, primarily driven by greater contributions from internally developed high margin gains.
Marketing Services gross margin was 60%, up two percentage points year on year as AI powered marketing services growth strong growth in high margin revenue streams. Particularly video accounts and racing search fintech and business services was. Was 51%, up four percentage points year on year, benefiting from growing scale of cloud services and improved revenue mixing fintech services alongside enhanced cost efficiency.
One quarter 4 operating expenses, selling and marketing expenses were 13 billion RMB, up 26% year on year. Refracting increased promotional efforts to support the growth of our AI native application and games R&D expenses growth. 20% year on year to 23.8 billion Ren and B primary due to house. Course and increased depreciation expenses gripping by our AI investments.
GNA excluding R&D expenses increased by 8% year on year to 12. 5 billion revenue B due to higher stop force. At quarter end, we had a personally 116,000 employees, up 5% year on year or 1% Q on Q. Primary refracted headcount additions to gains and our technology platform including AI related headcount.
Our fourth quarter non IFRS operating margin was 36%, up one percentage points year on year. Fourth quarter operating CapEx was 16.9 billion, renminbi increasing 40. 1% quarter on quarter as we accelerated investment in server infrastructure.
Year on year, operating capax decreased by 51%, reflecting concentrated cap. Expanding in full quarter 2024, leading to a high base effect. Operating CapEx was 2.7 billion RAM be up 60% year and year due to higher. Related Investments
Free cash flow was 34 billion. Increasing over six times year on year, reflecting stronger operating cash flow generation this quarter as well as lower capax spending versus Q424 as I mentioned earlier. On a Q on Q basis, free cash flow decreased by 42% due to seasonally lower game gross.
We see that seasonal settlement of certain accounts be able that cash. Position was 107.1 billion Ram B, up 5% quarter and quarter or 4.7 billion RAM B, mainly driven by free cash flow generation partially offset by sharing purchase of 19.6 billion RAM B and that's cash flows of 6.9 billion RAM B, primary relating to investment in other corporations.
For the full year of 2025. We repurchased 153,000,000 shares, with a total consideration of 80 billion Hong Kong dollars, a weighted average number of shares for. Calculating 2025 diluted EPS decreased by 2% year on year
Even we see high return opportunities and from investing in AI, we will likely buy back lower value of our shares versus 2025 to fund investment in AI while increasing our dividends subject to the shareholders approval at the upcoming AGM. We are proposing an annual dividend of 5.3 Hong Kong dollars per share. Reflecting 18% year on year increase, this dividend will be payable to shareholders on the 1st of June 2026. Thank you.
Wendy Huang
Thank you, John. We shall now open the call for questions. If you are dialing in by phone, please press 5 to raise a question, then press 6 to unmute yourself. If you are accessing from the Tencent Meeting or Wu meeting application, please click the raise hand button. At the button, we will take one question from the each analyst in the interest of town. So the first question comes from Candice Bond from UBS.
Candice Bond
Hi, good evening management. Thanks for taking my questions. I have a question on the AI front versus the margin. In our prepared remarks, we expect to increase profit from our existing business to more than cover incremental AI investment. I understand we need to look at this AI long term investment separately.
But as OpEx continue to increase into this year, how should we think about the profit margin or the gap between revenue and profit growth into 2026? And my second question is also on AI, how we strategically prioritize given the ongoing constraint in GPU and AI talent as we previously emphasized prioritizing internal AI deployment, but given the recent market development as management views shift, how we prioritize allocating resources or KPI that we monitor, is that a development of a of a SODA last language model or user engagement or token growth, IE 2B solutions? Thank you,
James Mitchell
Kenneth, why why don't I start and then you know Martin may compliment. So, yeah, I think it's implicit in our opening remarks that, you know, it is possible that our revenue would grow faster than our profit in 2026 due to the stepped up investment in new AI products.
And you know, if that's what eventuates, we're very comfortable with that outcome because we can see that these new AI products, you know, represent an opportunity for us to expand our footprint, you know, deliver new value to users. And we can also see, you know, from the user enthusiasm around some of these products that you know, that there's a very good opportunity for product market fit.
In terms of your second question around resource constraints on, you know, talent and GPU's, then as far as talent is concerned, you know, we've already been staffing up quite aggressively some very excellent quality talent from, you know, the world and from China for the hen UN team.
You know, we'll continue to make selective hires, but we actually feel we have, you know, really a state-of-the-art team, AI talent team already in place. And you know, we've been able to put it in place not only through through compensation as an incentive, but also through creating the right culture for the team through allocating, you know, the roles of the team and versus each other and the role of the team within the rest of Tencent appropriately through, you know, the best leaders of the team in turn attracting the best. Join us to, to the team
In terms of provisioning the team with ample compute and in terms of being able to offer the team, you know, use cases for the AI products they create that are somewhat differentiated and unique to Tencent. So that's on, you know talent where you know, I think that we were facing a situation of scarcity and you know what we're now, you know, much more comfortable with the the setup, although we'll continue to to recruit selectively
In terms of GPU constraints, then we've been quite actively provisioning more compute and that will be coming on stream progressively and increasingly quickly through through this year, especially the second-half of the year. And you know that additional compute comes from leasing capacity. It comes from us purchasing higher end imported GPU's which are now becoming available again and it comes from us purchasing the increasing quantity of domestically China designed GPU's.
And then in terms of utilizing those the the compute for different use cases. You know, the priority right now is you know, a new one and new AI products more generally. You know the claw products are inherently distributed in nature and and you know they they can themselves source compute, you know, from local. Devices from, from, you know, multiple clouds, you know, from, from 10 cent cloud, but but they're they're sort of somewhat agnostic in terms of the sourcing of compute.
So we are, you know, focusing our compute on a new one as the core foundation model and then on the new AI products. Thank you, James.
Wendy Huang
Reminder that each analyst please only ask one question. We can take your follow up later if we have more time. Next question comes from the Robin Jew from Bernstein.
Robin Jew
Thank you management for taking my question. I guess if I could get your thoughts on, you know, clearly we're heading into this AI cycle of investment. How should we think about your assessment of ROI and you know, the the timing of returns and the, the you know how you prioritize building versus renting and which parts of the AI stack you think are the most critical to be best in breed versus, you know areas where you think eventually these things will be commoditized as AI continues to move forward? Thank you.
Martin Lau
OK, well, you know, I think from an ROI perspective, we have already seen very good ROI's when we apply AI into our existing businesses right now. So if you look at the breakdown of our financials, you know, if you look at, you know, the financials on a combined basis and then sort of we break break it out and saying, oh, you know, these are the financials with existing businesses plus the investment into AI4 supporting these businesses, right?
You know, the, the, the growth is actually quite strong and and if you exclude the investment in new AI products, then the operating leverage is clearly there so. I think that's that's sort of level #1 right now, and then level #2 is. An investment into new AI products on that front, I think you know we would.
Be seeing new investments first, right, You know there there's not that much of A revenue. Especially in the context of China, unlike in the US where you can actually get consumers to pay subscriptions and you can get companies to pay for coding agents at a very high cost, in China those. Not sort of that that available.
So I think these will present themselves as investment. Upfront, but then over time we believe you will be able to generate revenue from these new AI products and they would generate, you know, very attractive return for us over time. You know, we, we quote Tencent Cloud as an example in which we initially actually have to invest in the business in terms of incurring losses. But over time, right, you know, it actually turns into a proper business.
And we believe AI will be like that. There will be a timing difference in terms of the investment and then the return for these new AI products in terms of building versus renting. I think, you know, if we can buy, right, you know, I think, you know, given how strong our balance sheet is, we would actually prefer to buy because then we don't necessarily need to pay the additional margin for, for leasing.
But I think, you know, given, you know, the constraints in the supply chain and all the different regulations, right? Sometimes we just have to rent. And I think, you know, we, we would do that if, if we need to secure compute. What was the last question, last pivot question? Did I answer all your questions?
Oh, the last question was if we think about the AI stack between kind of, you know, the models, the the orchestration layer, the application layer and so on. Which parts do would you say are most critical of attention to be best in breed versus, you know, areas where we think these would be commoditized? And you know, it's, it's OK just to have something.
I think at this point in time, it's actually very dynamic, right? You, you, you, you're in a fast moving market. I think, you know, it's very difficult for someone to say so, you know, oh, you know, there will be one layer more important than the others, right? You know, I think, you know, we, we have the resources, we have the people who have the team to actually invest in all these layers.
And especially the teams are actually very different than, you know, when you are actually, we have to build the team from scratch once again. And, and now it's actually sort of as James said, you know, we have a very strong core team and we have a very strong capability to keep attracting top talent.
But then if you start getting into the application layer, right, you know, it's actually, you know, playing into our strength, right? Because then suddenly you, you don't even need to have that model capability, But you know, it actually plays in to our strength in terms of product capability and orchestration capability connection, which is our strength ecosystem is actually our strength.
And all the infrastructure services like security is also something that we have invested for a very long time. And the ability to go across devices such as mobile and PC, right? You know, it's actually our core strength too, right. So I, I think, you know, that, that actually is really moving into our, our territory of the spring.
So we we would actually have, you know, have to and and also invest in all these capabilities and you know, the the dynamics of the market we played out itself and hopefully will become best of breed in all layers. Thank you.
Wendy Huang
We will take the next one question from Walnut Kwong from Goldman Sachs.
Walnut Kwong
Thank you, pony, Martin, James, John and Wendy. So when I asked about the AI agentic agent potential with the recent launch of Q core work party and we saw the skill hub as well. How, how should we view parallels of let's say Android versus what we are seeing now for open core in this agentic opportunity and our positioning within.
So you mentioned about Tencent cloud in that opportunity and how do we plan to differentiate other parts of the stack, for example, models? Thank you.
Martin Lau
I think Claw is actually a very exciting concept, right? You know, and, and it actually sort of presents a decentralized model or decentralized regime for how AI works in this world. So there's some parallel to sort of how the Internet evolves, right? Very beginning when Internet first appear is right, you know there seems to be sort of, you know there is one entry point which is the browser and then you know there is sort of one distribution point which is the search engine.
And, but over time, you know it, you know, there are different services which evolve, right? You know, and, and then when mobile Internet comes, suddenly you see some, a multitude of applications coming up, right? You know, and, and within the applications, there are applications which are completely mobile native, mobile centric, mobile 1st.
And then there are also mobile applications that were the PC Internet champions who actually migrate onto the mobile Internet world right now. And and I think, you know, this is, you know, how we felt the claw is right now for for some time, right, AI that seems to be sort of new. Everybody is trying to fight to become the AIAGI Hedgeman or monopoly, right?
You know, there, there seems to be a point in which, like people said, if there's one model which which is AGI, then you know, it would rule over everybody, right? You know, but the reality is not right. You know, you have multiple models becoming, they're very strong and you know they specialize in different kinds of activities, right? One in chatbot, the other one in in coding and the other one in multimodal.
And you also have open source, which are pretty good. And you have a lot of other models, which is sort of your fast followers too. And then there was a time in which in the 2C world, there seems to be the the chat bot being sort of, you know, the, the single entry point.
But now with Claw, you can see, you know, it opens up a completely decentralized regime where, you know, many companies can have their own Claw and the claw can be using all kinds of different models, right? You know, and it's supported by, you know, the infrastructure of cloud. And each one of the claw has to figure out its unique value proposition, right? You know, to, to win the heart of the users.
And the claws also something, you know, make use of not just the cloud, not just its unique unique the model, it also sort of also make use of the tools available to them on the devices and utilize the file system, right? You know, so it becomes a much more exciting decentralized world and we felt we, there's a lot of opportunities for us in terms of building products to to cater to people's needs.
So that's why there's Q claw. There's also work buddy. And in the future, I think a lot of existing apps will try to come up with their own claws, right, you know, and their own agentic capabilities and different models would also sort of, you know, try to compete to win the hearts of these claws.
So it becomes a much more exciting world and decentralized world for everybody to have some participation. And you know, we we just need to, as I said, right build expertise in the different, different layers, you know, in the model layer, in the product layer, in the infrastructure layer. And you know, each layer would have to sort of, you know, have their their own specific value proposition to win, you know, its its own usage. Thank you, Martin.
Wendy Huang
We will take the next question from Ellie Jong from Macquarie
Ellie Jong
Management. For taking my question. I actually have a follow up just on just now question. Towards the agentic era, how would management evaluate Tencent value propositioning in this new agentic era and since we are putting. Or even alongside with the other LLMS, you know, to kind of towards the pursuers and consumers, how do we potentially prevent the from the other LLMS diluting our own foundation models value in the longer term? Thank you.
James Mitchell
I think that in terms of, you know, Tencent unique value proposition or what we can bring to users in the claw era, you know, that there's a few sort of inherent, you know, attributes that we possess, which we think are very suitable for, for, you know, the, the agents, the deployment of clause. And you know, Martin's touched on them.
But, you know, one of those attributes is that we're a company whose, you know, capabilities span across, you know, PC, mobile cloud. We're a company whose capabilities span across applications and, and the World Wide Web, you know, just as the, the agentic clause, you know, span the devices and span the sort of domains.
We're a company that, you know, operates a number of centralized apps, but also hosts some extremely, you know, decentralized yet vibrant ecosystems, most notably the mini program ecosystem. And so, you know, 1 framework you could think about is that in prior years, the, the arrival of the mobile Internet really sort of turbocharged the, you know, application experience vis A vis the, the, the more centralized app experience for vis A vis the more decentralized World Wide Web experience.
And, you know, now with these identical capabilities and clause, then there's an opportunity for, you know, decentralized experiences such as many programs to to be turbo charged and, you know, themselves develop, you know, far more powerful capabilities than they enjoyed in the past.
So, you know, that's, you know, why we think there's inherently a natural fit between our capabilities and our interests and the, the, the. Deployment of these agents or clause and and you know that's what. Why, you know, we're seeing one reason why we're seeing, you know, consumers and pro steamers enthusiastically adopting our own agent and claw services.
In terms of the part of your question about preventing other large language models diluting our models value, I I may not sort of understand the premise correctly, but but you know, I don't see that happening. You know, the, the if you use these clause then you know, you go into them and you have a choice.
Do you want to use, you know, model A which is, you know, very high performance and high price per token or you know, model Z that's medium performance and very low price per token, all models, you know, B through Y in the middle. And you know, that's part of the appeal of the clause.
And you know, Henuan is, you know, one of those models that that is available and you know, we believe with the capabilities of the Henuan team now in place that going forward. Konyuan will get better faster and therefore consumers will naturally increasingly opt to to use Konyuan.
But it I don't think it will be a monopoly situation. You know that the clause that are successful will be clause that continue to allow consumers and prosumers to, you know, make their own choice along the price performance curve. And you know different models we'll sit at different places on the price performance curve and you know we want to you know be one of those, but we don't intend to be the only one of those. Thank you.
Wendy Huang
We will take the next quick question from Alicia Yap from Citi.
Alicia Yap
Hi, good evening management. Thanks for taking my questions. I have a questions related to the physical AI. So considering the proliferations of the productivity focus AI agent across enterprises, especially the tradition. Industry, do you believe this will accelerate the demand for the usage of the world models like the the 3D models that you have? And also what is management assessments of Tencent? Capability and also the competitive strength in the future. AI in Iraq. Thank you,
James Mitchell
Alicia. I think your point is a reasonable one that you know, that there is already a, you know, computer aided design capabilities and you know, one would naturally expect, you know, AI to to supplement and eventually supercharge those abilities. And you know, that's important in industrial design, it's important in architecture. It's actually very important and increasingly important in video games.
And, you know, we believe we can see that we're in a somewhat uniquely good position to to, you know, provide the data to train the models to, to in turn supply, you know, those 3D tools because of the breadth and depth of, of 3D graphical assets within our video games.
But you know, it's ultimately. A sort of a big niche and, you know. It's one that we are well positioned to address, but but I wouldn't say it's, you know, the biggest opportunity ahead of us. You know, there's many larger more immediate opportunities. Thank you.
Wendy Huang
We will take the next question from John Choi from Daiwa.
John Choi
Thank you for taking my question. I have a question related to games and you know, AI disruption, you know, have you seen? You know, already starting to see some headcount and game development costs being impacted and how do? Do you think AI will impact the quality and also the overall cost side? And how should we? Expect you know Tencent to prepare.
This would also distribution and. Publishing be more important going down the road as we see more increased number of games. And also if you look, you know, AI lowers the development entry barriers. Are we going to see? Meaningful increase in the supply of the game studios and in terms of the overall quantity of the games going down the road. Thank you.
James Mitchell
Yeah, thank you for the question, John. So I don't know if any of you attended the Game Developers Conference last week, but it is the sort of premier event each year for game developers. And you know, as you would expect, there was a number of, you know, well attended, you know, presentations about the use of AI within creating games.
And you know, I think a couple of broad observations. 1 is that, you know, those presentations were were pretty exclusively focused on how to use AI to, you know, upgrade content within existing games to accelerate that, that the content creation, improve the content creation within games.
But you know, that there is not yet the capability to create games, you know, completely from scratch using AI for, for a number of reasons that we can get into. And then, you know, the second observation is that many of the, you know, best attended presentations were by our colleagues within Tencent Interactive Entertainment Group.
And, you know, they talked about how, you know, AI can be deployed in games. You know, for graphics, AI can be deployed in games. For gameplay, AI can be deployed in games, but for, you know, user companionship and so forth. And you know, for, for we believe that, you know, we're at the the forefront of the industry in this regard.
And you know, the feedback from many of the people, the developers who attended the Game Developers conference was consistent with that belief. In terms of the second-half of your question about whether AI will result in, you know, a flood of new games and therefore, you know, elevate the importance of publishing versus development.
Then you know, the, the, the sad reality of the game industry is that it's perpetually in a, you know, oversupply situation. You know, every year, as Martin mentioned, there's 200,000 new games on mobile, there's 18,000 new games on Steam.
So you know, whether that number goes from 200,000 to 2 million to 2 billion to 2 trillion, you know, has sort of diminishing incremental impact. You know, the the key is really, you know, making and then you know, extending and rendering Evergreen that the best games and you know, in order to do that, you need, you know, the best human beings, you know, supplemented by the best technology.
And you know, we think that therefore the the value balance between development and publishing, you know, will remain where it is today and the critical SuccessFactors, it will continue to favor the best developers in the industry. Thank you.
Martin Lau
Just to add a couple more points, right #1 you know, when you talk about sort of AI disruption for games, right, you know that that basically sort of, you know, imply it's actually bad for the gaming industry. But but I think sort of gaming is actually one of the industries that would benefit from AI, right?
You know, because when AI proliferates, I think people would have more free time at their hands and the demand side would actually increase significantly for the gaming industry, which I think you know, is a rare certainty in the in the sort of face of AI proliferation.
And #2 is, you know, the, the, the availability of game, great tools, you know, would be available to new developers, but it also said it will be available to very organized teams and highly talented developers, you know, that are already running big Evergreen games, right.
You know, I would say sort of, you know, when a tool is actually available, it's, it's, it's kind of overly benefit the, the people who have the resources and, and who have already got all the gamers around the platform. And, you know, they can actually better use these tools to, you know, increase the, the, the, you know, amount of production and, and make, you know, games even more over Evergreen, right.
So I think that's an that's an advantage for players who have Evergreen games and are also extremely fast and agile in embracing technology. And finally, right when there's a multitude of innovations, right, a lot of times I think what we saw in the gaming industry is like an idea comes. Around and then it's not perfect and it gets sort of iterated and and and and polished over time.
And I think the process will actually, again be speeding up if a lot of these games who have a lot of users look at these innovations and can iterate faster and incorporate these new experiences into their existing games and make games essentially into platforms. And I think, you know, that's a unique opportunity that we would see over time as well. Thank you.
Wendy Huang
We will take the next question from Alex Yao from JP Morgan.
Alex Yao
Thank you, Wendy. Thank you, management for the opportunity. I want to follow up on the AI cloud side of the business. Given very strong demand for AI compute, but on the other hand also price inflation for the server, AI servers due to the rising cost of DRAM and HBM.
Can you guys help us understand Tencent clouds of pricing power and also for philosophy to value capture in such a very dynamic environment? Or put it another way, do you want to fully pass through the cost inflation to your customers or partially subsidized the cost inflation and then get more market share or even potentially, you know, more than fully of pass through the cost of inflation to capture more profit? Thank you.
James Mitchell
Thank you for the question, Alex. So, you know, first of all, I, I'd start by saying that, you know, clearly there is a surge in demand for sort of AI compute, but it's not only for AI compute. You know, when people utilize the, the agentic tools that we've been discussing that they're using them and they create software and you know, that software, you know, then primarily it needs to be executed.
And when it executes, most of it is not executing on, on, you know, GPU, it's executing on CPU and then it creates as it executes, it creates, you know, memory demands. So it's not just, you know, GPU, DRAM, HBM where we're seeing demand picking up. It's also, you know, CPU it's, you know, regular RAM, it's SSD, it's hard disk drive, it's across the board. There's a pickup in demand
And, you know, in terms of how the industry and how addresses at an industry level responds with pricing, then, you know, for years the industry has suffered because the cloud services providers in China were operating at very low margins. And one of the reasons they operated at very low margins was because, you know, if there was a new entrant or if the customers wanted to, to source infrastructure directly, they were able to telephone the supplier and, you know, order the infrastructure that they wanted from, from the supplier of, you know, CPU or GPU DRAM.
You know, that's no longer the case. You know, now the supply is, is booked out months quarters, in some cases years in advance. You know, the supply is prioritizing the biggest, most regular customers with which are the, the hyperscalers, such as ourselves.
And therefore, you know, the, the, the customers, the smaller cloud providers, you know, no longer have certainty that they can, you know, source supply and they need to come to the hyperscalers. And you know, the hyperscalers have been operating at low margins. And so, you know, when the demand picks up, then, you know, we almost sort of as an industry have no choice but to pass through higher prices. And you have seen a number of price increases in, in, you know, China cloud in the last 24 hours as a result,
In terms of, you know, how we sort of value capture, you know, in this dynamic environment, then, you know, 1 broad principle is, you know, we seek to deliver, you know, more value through, through, you know, enrichment. And so, you know, enrichment means that, you know, at a minimum, if you, you have, you know, compute, you can rent it out bare metal. When you get a certain low price and low margin,
You know, preferably you, you rent it out, you subdivide it and virtualize it into tokens. And then you get a higher price and higher margin per unit of compute. And I ideally you bundle it into a platform as a service or software as a service, and then you can get, you know, the best pricing and the best margins.
And so that's part of the journey that we've been on and that's part of, you know, how Tencent Cloud was moved from, you know, very substantial losses 4 years ago to pretty substantial profits last year. And we'll continue on. That journey of you know, moving from bare metal to token to platformization and and to to software. Thank you, thank you, thank you.
Wendy Huang
We will take the next question from Gary Yu from Morgan Stanley.
Gary Yu
Hi, good evening and thank you for the opportunity. I, I have one question regarding the comment quite a few times that we mentioned that we are not a first mover or we are even the late Comer in AI in the US. We have also observed that it's becoming very difficult for some of the late comers to catch up even for those that have very high resources in terms of compute talents and data.
So, so how does management get comfortable and confident that we won't be following the same path in terms of, you know, lagging behind, not able to catch up and around areas on compute modelled applications? Thank you.
Martin Lau
Yeah, I think that's a very good question. And I think if you are playing just one game, then basically it's, it's hard to sort of, you know, catch up on one game, right. But then, you know, if you view AI as sort of, you know, a multiple of different games, then you know, there are there are new opportunities, new new frontier that's opened all the time radio.
So I think, you know, when every it's already happening right now. If you look at the model right now, in the very beginning, everybody felt, you know, it's the chatbot and then and then coding comes around and then multimodal come around and, you know, in the and, and, and then sort of, you know, when, when everybody felt, oh, that's pretty much it. Then suddenly sort of, you know, claw came around, which basically further decentralized the whole AI landscape.
So, so you know, in the future, we actually felt, oh, you know, there will be just like apps, right? You know, there will be a lot of different permutations of of how AI will be packaged from model to the product to agent and existing services will be having sort of, you know, different AGNT capabilities. There will be new AGNT capability coming around, you know, on mobile, on PC.
So, you know, it's very early, you know, early days in the, the whole AI development world. So, so that's why, you know, just within a short period of time, you can see sort of, you know, there are already a lot of proliferations and, and there'll be more and more coming.
So that's why it's actually important to have some fundamental capability, right? You know, and, and we do have a lot of them in term at the application layer, you know, be it, you know, and be it, you know, our ecosystem of having, you know, communication and, and presence on PC and mobile and a lot of infrastructural capability, including security and cloud and payment.
And, you know, all these elements can be packaged together, you know, in the new race of AI. So it's not sort of near 1 race. It's actually sort of, you know, a world of many, many races. And I think, you know, that would, you know, increasingly manifest itself and, and as a result, there will be a lot of opportunities for different players to come up and innovate from behind.
So I, I'm not sort of, you know, very worried about, you know, you know, being late, but I'd be worried about, you know, if we're not innovating fast enough, right? You know which I think you know we as as we restructure our Guan Yuan team and as we started to invigorate all our product teams to start innovating with products and I think you know that's actually happening in a very exciting way for us. Thank you.
Wendy Huang
We will take the next question from William Packer from BNP.
William Packer
Billy, your line is open eye management. Thanks for taking my question. Press reports suggest that Apple is planning to cut to cut App Store Commission rates by 5% for apps and two to 3% for mini games in March in China Tencent, a potential major beneficiary.
To what extent should we expect these cuts to flow through to Tencent gross margin or would they be shared with other stakeholders such as consumers, gaming partners or perhaps tax revenue? Thank you.
James Mitchell
I will. So, you know, happily in this case the press reports were based on these sort of. Objective reality of an apple, you know, formal announcement and, and so this is not a, you know, a speculative hypothetical. It's a, you know, actual development that takes effect in the last few days.
And in terms of the flow through then, you know, there should be a good flow through, you know, when we have in a game development partners and we're the publisher of those games, which is now quite a small minority of our game revenue. Then in the overwhelming majority of cases, the revenue share is calculated based on the gross revenue, not on the, the, the, the, the revenue net of the app will take. And so that, you know, flows through to us,
You know, if by taxes you're referring to us paying teens percentage corporate income tax on, you know, this incremental profit stream, then I suppose that's correct depending on the extent to which we, you know, reinvest this incremental profit stream into new AI products.
I think that you, you, you talked about one part of the Apple announcement, which is the, the sort of quantitative part that moves from 30% to 25 and 15% to 12. But you know, for us, actually the more important aspect of the Apple announcement looking forward was that, you know, Apple stated that.
It would effectively offer developers in China equivalents with whatever the lower rate is that, you know, developers elsewhere in the world are paying to to App Store. And so, you know, our view is that with the evolving industry trends, it's a sort of matter of time for the the tolls the App Store collects to normalize downward in different parts of the world.
And you know, with this, you know, declaration, Apple has has stated that, you know, as the take rates move down in different parts of the world, so the take rates will move down in China in synchronicity. So we believe that this is, you know, a very positive first step, but but you know, it is, you know, a first step on a a multi step positive journey. Thank you.
Wendy Huang
Thank you. We will take the last question from Alex Liu from Bank of America.
Alex Liu
Well, thank you for taking our questions. My question is really just on AI chips. So we're seeing a growing number of your tech peers are prioritizing the development of in house chip design capabilities. So I'm just curious where in house chip development fits into instance on AI priorities. Thank you.
Martin Lau
Yeah, thanks for your question. I, I think at this point of time, it's not the most critical thing that we'll be focused on. So if you look at the chip, you know, there's, you know, a difference between training chip and inference chip, right? You know, and, and for training chip, it's actually very, very difficult to, to design and, and you manufacture
And you actually want to have access to the most state-of-the-art, you know, training chips to the extent possible and, and in the most flexible way so that, you know, you can actually sort of keep training for the best model. And then, you know, if you're talking about the inference, right, you know, I think inference, it's mostly for cost.
And I think for cost at this point in time, there's actually a lot of different supplies in China. Which is actually very different from, let's say in. The training space, right, where there's essentially one or two players who can actually command a very, very high margin, right? You know, in the inference world, people basically sort of are earning much lower. And there are many more solutions and. You know options.
So, so I think you know, the, the key for us is actually sort of leverage the best training chips to train the best model at this point in time. And there's a lot of value in being focused. And when it comes to the inference part, right, You know, over time, I think you know, the the market would actually sort of, you know, play out in such a way that that I think, you know, the margin in the inference chips will be actually quite manageable
At this point in time. We are very focused in leveraging. The best chip to train our model, our Kunyan 3.0 is going to be much better than. 3.0 And that's actually just the starting point. I think, you know, overtime we'll be able to iterate the training of our model faster.
And you know, I, I'm very confident that, you know, if we focus on that, you know, we'll reach SOTA at some point in time. And I think that's actually the most important thing for us. And the next important for us is actually really unleashing the power of our product development capability and integration and connection capability in order to design the most exciting AI products for for users.
I can hear when those are done right, then we'll think about, you know, how do we try to, you know, reduce the cost of inference? Thank you, marketing.
Wendy Huang
We are now ending the webinar. Thank you all for joining our results today. If you wish to check out our press release and other financial information, please visit the IR section of our company website at www.tencent.com. The replay of this webinar will also be available soon. Thank you. And see you next quarter.
Details at Tencent IR
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