Tencent Reports Strong Q3 Growth Driven by AI Integration Across Gaming and Advertising

Chinese tech giant Tencent's quarterly revenue rises 15%, fueled by AI

Tencent on Thursday posted 15% year-on-year revenue growth, with AI boosting the Chinese tech giant's performance in advertising targeting and gaming. Here's how Tencent performed in the third quarter of 2025, per earnings released on Thursday: Tencent boosted its capital expenditure earlier this year as it ramped up AI and eyed European expansion for its cloud computing services, which would compete against market leaders Amazon Web Services, Google Cloud and Microsoft Azure. It has its own AI foundational model in China called Hunyuan, however it also uses DeepSeek in some products. Tencent shares are up 56.7% year-to-date.

Tencent's quarterly growth beats expectations on gaming demand, AI services

BEIJING (Reuters) -Tencent reported a third-quarter revenue growth of 15% on Thursday, as China's largest social media and gaming company benefited from strong gaming demand and expanding AI-driven services. The Shenzhen-based technology company posted revenue of 192.9 billion yuan ($27.08 billion) for the three months ended September 30, better than the 188.9 billion yuan average of analyst estimates compiled by LSEG. Gaming revenue rose 15% to 42.8 billion yuan at home and 43% to 20.8 billion yuan overseas. That growth was driven by titles including "Honor of Kings" and "Peacekeeper Elite", as well as newer games such as "Delta Force". Revenue from advertising rose 21% to 36.2 billion yuan, boosted by artificial intelligence that improved targeting capability. Net profit climbed to 63.1 billion yuan, compared with a 57.3 billion yuan average analyst estimate, LSEG data showed. Tencent has been increasing AI investment, alongside peers such as Alibaba as well as U.S. tech majors Microsoft and Google. The company has said it expects AI-focused capital expenditure to reach the "low teens" as a percentage of revenue in 2025. Third-quarter capex totalled 13 billion yuan versus 19.1 billion yuan in the previous quarter. Tencent's AI investment comes amid escalating technology tensions between China and the U.S., with U.S. export restrictions making it difficult for Chinese companies to purchase advanced AI chips from foreign suppliers such as Nvidia. Tencent has previously said its stockpiled AI chips should protect it from U.S. trade measures, and that alternative chips are available domestically. Tencent has integrated AI across platforms this year. It has embedded startup DeepSeek's model into WeChat, its super-app used by over 1 billion people in China for messaging and payments. The company has also launched Yuanbao, a ChatGPT-style chatbot that ranks among China's most popular AI assistants alongside ByteDance's Doubao. Tencent is also developing proprietary AI capability. It unveiled text-to-image generator Hunyuan Image 3.0 in September and has introduced services that convert text and images into 3D visuals. ($1 = 7.1230 Chinese yuan renminbi) (Reporting by Liam Mo and Brenda Goh; Editing by Muralikumar Anantharaman and Saad Sayeed) By Liam Mo and Brenda Goh