Tencent admits GPUs only pay for themselves when powering personalized ads
Chinese web giant says accelerator shortage is over as local hardware arrives in volume
Chinese web giant Tencent struggles to earn a return on investment from GPUs – unless it uses them to power its advertising business.
“If we buy GPUs and we deploy them into our ad tech, then that's a relatively short-cycle investment,” said Chief Strategy Officer James Mitchell during the company’s Q1 2026 earnings call. “The GPUs yield better targeting, higher click-through rates and higher revenue and profit on a pretty accelerated basis,” he said.
But the company views GPUs powering work on its Hunyuan foundation model as “important for our franchise.”
Mitchell said Tencent is comfortable with this situation.
“There's been many products within Tencent … that went through lengthy incubation periods where they had no return on investment, but we were confident in the franchise value creation,” he said. “And then over time, they had...
Copyright of this story solely belongs to theregister.com. To see the full text click HERE
