Tencent sees strong Q1 growth as gaming rebounds, AI ads boost sales

Tencent Holdings, China’s largest tech company by market capitalisation, reported a 13% year-on-year revenue increase in the first quarter of 2025, driven by strong growth in gaming and AI-powered advertising.

The company posted revenue of 180 billion yuan ($24.97 billion) for the quarter ending March 31, surpassing analysts’ expectations of 174.6 billion yuan. Net profit reached 47.8 billion yuan, slightly below the forecast of 52.2 billion yuan, according to LSEG data.

Tencent’s domestic gaming revenue surged 24% to 42.9 billion yuan, while international gaming revenue rose 23% to 16.6 billion yuan. Key titles driving the growth included Dungeon & Fighter Mobile and Delta Force .

Advertising revenue climbed 22% year on year, helped by the rollout of AI-driven ad tech upgrades, delivering more targeted and efficient marketing tools across platforms.

The company’s Fintech and Business Services division, which covers cloud services, loans, and wealth management, also grew 16% to 27.6 billion yuan.

Tencent continues to invest heavily in AI. In March, the company said it would devote a low double-digit share of its 2025 revenue to AI-related capital expenditures. That follows 39 billion yuan spent on AI in Q4 2024.

Its proprietary large language model, Hunyuan, received a public release as version T1 in March. Tencent also became the first major Chinese firm to integrate technology from DeepSeek , a fast-rising AI startup.

DeepSeek’s models now power features within Tencent’s core services, including WeChat and its AI assistant, Yuanbao.

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