Tencent Shares Hit More Than Three-Year High as App Launches DeepSeek Testing
The function isn’t currently available in WeChat, the overseas version of the app
Chinese technology giant Tencent Holdings began tests to integrate homegrown startup DeepSeek’s artificial-intelligence model into its Weixin messaging app, sending shares in the social-media and videogame company to their highest level since 2021.
Tencent recently started testing access to DeepSeek’s AI model for searches in Weixin, in addition to its own Hunyuan model, allowing some users to click on AI Search on the search bar within the app, a Tencent spokesperson said Monday.
The function isn’t currently available in WeChat 700 4.30%increase; green up pointing triangle, the overseas version of the app. Weixin and WeChat had a combined 1.38 billion monthly active users at the end of September.
Weixin is known as an everything app in China, offering messaging, payments and many other services on one platform. Users can play games, order food, hail a ride, send each other cash and book travel, all without leaving the app.
Jefferies analysts described the testing as “an important milestone for Weixin in becoming an AI superapp/agent in the future” in China.
Weixin stands out from other AI-powered consumer-facing apps thanks to its vast user base, daily use time and diverse engagement enabled by scenarios through its mini programs, the analysts said in a research note.
Shares in Tencent, China’s largest public company by market capitalization, rose as much as 7.8% early Monday as it became the latest tech player seeking to capitalize on DeepSeek’s low-cost yet powerful model.
Chinese AI company DeepSeek emerged seemingly out of nowhere last month. DeepSeek has touted its latest AI model, R1, as being particularly good at problem solving, performing on par with OpenAI’s o1 reasoning model but at a fraction of the cost per use.
Over the past few weeks, Chinese companies from software makers to telecommunication providers have rushed to deploy DeepSeek’s model. Chinese tech-related stocks have gotten a lift on hopes that DeepSeek’s breakthrough will power business growth.
Raymond Ma, Invesco’s chief investment officer for Hong Kong and mainland China, said the benefits brought by DeepSeek could “lead to a rerating of Chinese stocks.”
Goldman Sachs estimated that the Chinese AI story could attract as much as $200 billion of net buying to the stock market.
Tencent has also long been developing its own AI model, called Hunyuan. It said one version released in November delivered performance comparable with Meta Platforms’ Llama 3.1. According to some researchers, Tencent might have required about a tenth of the computing power Meta used to train the model.
Shares in Tencent have risen some 70% over the past year, thanks to the resurgence of its videogame business, and, more recently, optimism over China’s AI advancements. That came despite the stock suffering one of its worst selloffs in years in early January after the U.S. added the tech company to a Pentagon list of businesses with alleged ties to the Chinese military, an inclusion the company said was a mistake.