Chinese Tech Giants Report Early AI Returns
- tech360.tv
- 3 minutes ago
- 2 min read
Chinese technology powerhouses, including Kuaishou and Tencent, are beginning to reap early returns from their significant investments in artificial intelligence (AI). This impact is evident across various businesses, from short video platforms to social media giants.
Kuaishou, China’s second-largest short video application, attributed its third-quarter revenue growth to the integration of AI technology. This included upgrades to marketing solutions and its Kling video tool.
Online marketing services sales for Kuaishou grew 14% to USD 2.81 billion. Sales for other services increased 41.3% to 5.9 billion yuan during the same period.
Co-founder and Chief Executive Officer Cheng Yixiao stated that “AI capabilities deeply embedded across business scenarios” contributed to a strong quarter for the company. Cheng also expressed confidence in a “comprehensive AI application ecosystem” for long-term growth.
Tencent, a social media and video gaming giant, reported a 19% increase in its third-quarter profit, also linked to AI-related gains. Founder, Chairman, and Chief Executive Officer Pony Ma highlighted benefits from strategic AI investments.
Ma noted that areas such as advertisement targeting, game engagement, and the production of code, games, and videos have all seen improvements due to AI.
AI emerged as a positive aspect for Baidu, which experienced a challenging quarter. The search engine company saw a 50% increase in AI-related revenue.
This AI growth spanned its cloud, application, and marketing businesses during the third quarter. This contrasted with a 7% decline in Baidu’s overall revenue for the period.
Chief Financial Officer He Haijian commented that Baidu’s AI-related businesses have “laid a solid foundation for sustainable long-term growth.”
Analysts at BOC International observed that the broader adoption of AI tools among Chinese organisations has positively affected business performance. They noted that “AI applications in specific business scenarios have been validated with emerging monetisation potential.”
Deputy Head of Research Consultancy Charlie Chai suggested that Chinese organisations’ disciplined return-on-investment culture will help them generate value during the AI boom. This culture could also mitigate potential downturns.
Despite the positive outlook, concerns exist regarding excessive spending and the risk of wasted investment in AI. Chief Investment Officer Brock Silvers of Kaiyuan Capital considered the scale of capital expenditure "extremely worrisome to investors."
Silvers cautioned that if AI underperforms or demonstrates a longer timeline for returns, the market reaction "could suddenly turn savage."
Chinese tech giants Kuaishou, Tencent, and Baidu are reporting early financial gains from significant AI investments.
Kuaishou linked its revenue growth to AI technology used in marketing solutions and video tools.
Tencent’s profit jumped 19%, with AI improving areas like advertisement targeting and game engagement.
Source: SCMP