Tencent Tests DeepSeek AI Integration In Weixin Boosting Shares To 2021 Levels

By Sherry Qin

        Chinese technology behemoth Tencent Holdings has commenced trials to integrate DeepSeek's advanced artificial intelligence model into its popular Weixin messaging app. This move has propelled Tencent shares to their highest level since 2021.
    
Tencent's Strategic Move

        Tencent recently initiated beta testing of DeepSeek's AI search capabilities within Weixin, alongside its own Hunyuan AI. This means that some users can now access AI Search through the app's search bar. According to a Tencent spokesperson, the feature is currently restricted to users within China.
    

        Weixin and its international sibling WeChat boast a combined user base of 1.38 billion monthly active users as of late September. What sets Weixin apart is its extensive functionality, offering everything from messaging and payments to gaming and travel bookings without leaving the app.
    
Jefferies Analysts Weigh In

        Jefferies analysts highlighted this integration as a significant step towards making Weixin an AI-driven superapp in China in the future. The vast user base and extensive engagement within the app's mini programs position Weixin uniquely in leveraging AI.
    
Market Impact and Expectations

        Shares in Tencent, the largest public company by market capitalization in China, surged by up to 7.8 percent. This increase reflects the growing interest in the Chinese AI sector, particularly following DeepSeek's emergence. DeepSeek's R1 model is noteworthy for its robust problem-solving capabilities at a significantly lower cost compared to models like OpenAI's GPT.
    
DeepSeek's Rapid Rise

        DeepSeek gained prominence recently, claiming its latest AI model, R1, performs similarly to OpenAI's o1 reasoning model while incurring only a fraction of the per-use costs. This makes it an attractive option for tech giants like Tencent looking to enhance their AI offerings cost-effectively.
    
Analyst Perspectives

        Raymond Ma, chief investment officer for Hong Kong and mainland China at Invesco, suggests that DeepSeek's contributions could lead to a reassessment of Chinese stocks. Goldman Sachs predicts that the Chinese AI sector could attract up to $200 billion in investment.
    
Tencent's Continued AI Development

        Tencent has long been invested in AI, developing its Hunyuan model. In November, a version of Hunyuan was released, demonstrating performance on par with Meta Platforms' Llama 3.1. Interestingly, some experts believe that Tencent might have achieved similar results using only a tenth of the computational power Meta utilized.
    
Stock Performance

        Tencent's stock price has surged by about 70 percent over the past year, partly due to the revival of its gaming business and optimism regarding China's advancements in AI. Notwithstanding, the stock suffered one of its worst sell-offs in years in early January after it was incorrectly added to a Pentagon list of businesses linked to the Chinese military.
    

        Write to Sherry Qin at sherry.qin@wsj.com
    

        (END) Dow Jones Newswires
    

        February 17, 2025 01:27 ET (06:27 GMT)
    

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