Tencent VP Li Qiang: AI accelerates global competition, shifting from scale expansion to efficiency battle

Tencent VP Li Qiang: AI accelerates global competition, shifting from scale expansion to efficiency battle

Tencent Holdings Ltd. has embarked on its first bond sale in four years, marking a significant move in the Chinese tech sector's ongoing fundraising efforts. The company is marketing five-year, 10-year, and 30-year offshore yuan-denominated notes, with initial price guidance set at 2.6%, 3%, and 3.6% respectively . If successful, this sale would be Tencent's first-ever dim sum note issuance and its first bond offering in any currency since April 2021.

The proceeds from the proposed senior unsecured bonds will be used for general corporate purposes, including potential investments in artificial intelligence (AI) capabilities. Tencent's debt offering comes at a time when the technology sector is experiencing a surge in fundraising activity, with major companies investing billions in AI technologies. According to Bloomberg Intelligence, total capital expenditure by major Chinese internet firms such as Alibaba Group Holding Ltd., Tencent, Baidu Inc., and JD.com Inc. is expected to hit $32 billion in 2025, more than doubling from $13 billion in 2023 .

Tencent's VP Li Qiang recently highlighted the accelerating global competition in AI, shifting the focus from scale expansion to efficiency battles. This bond sale is a strategic move to secure funding for Tencent's AI initiatives, aligning with the broader trend of increased investment in AI technologies among Chinese tech firms.

The debt offering also reflects the intensifying competition in the global AI race, with companies seeking to secure funding to stay ahead. Alibaba Group recently raised about $3.2 billion through a convertible bond offering, while Baidu raised 4.4 billion yuan ($618 million) from a dim sum bond offering, following a 10 billion yuan issuance in March .

In summary, Tencent's bond sale underscores the growing importance of AI investments in the tech sector and the intensifying global competition in this area. As companies like Tencent, Alibaba, and Baidu continue to invest heavily in AI, the financial landscape is evolving to support these ambitious initiatives.