# Tencent Shares Decline as Attention Focuses on Increased AI Spending

Chinese technology company Tencent's share price declined by 1.8% and reached 438.4 Hong Kong dollars. Despite the company's revenue growing 11% year-over-year to 204.8 billion yuan in the second quarter, investors' attention has been drawn to increased spending directed toward artificial intelligence.

In the second quarter, Tencent's investment expenses reached a record 52.8 billion yuan, which significantly reduced the company's cash reserves. For investors, the key issue now is how quickly the funds invested in artificial intelligence will be reflected in revenue and profit. Against this backdrop, Mizuho reduced Tencent's share price target from 610 to 560 Hong Kong dollars.

At the same time, advertising revenue grew by 22%, cloud services development accelerated, and the company's artificial intelligence model HY3 ranked among the top three globally by user adoption.

Source: Investing.com