Chinese technology giant tencent on Wednesday reported a 9% increase in sales in its first-quarter 2026 results, which fell short of analysts’ expectations.
Here is Tencent’s first quarter 2026 earnings compared to LSEG’s analyst forecast data:
Sales: 196.5 billion Chinese yuan ($28.9 billion), expected to be 199 billion Chinese yuan. Domestic game sales: CNY 45.4 billion, up 6% year-on-year, but slower than the 24% increase the sector recorded in the first quarter of 2025.
“We will start 2026 by making significant early progress on new AI products and continue to leverage AI to grow our existing core businesses,” Tencent Chairman and CEO Ma Huateng said in a statement.
“Our core businesses continued to grow engagement, revenue and profits, and provided cash flow.
to fund AI investments and future AI deployment use cases,” he added.
Benefits from AI
Tencent’s fintech and other business services division brought in 60 billion yuan in the first three months of this year, up from 55 billion yuan in the same period last year.
Business services revenue increased 20% year-on-year, the company said, with growth driven by increased cloud services revenue supported by rising demand in domestic and international markets, including demand for AI-related services. It added that its AI agent tool WorkBuddy is the most popular agent service in China.
Morningstar senior equity analyst Ivan Hsu told CNBC that the company’s AI investments are already paying dividends.
“Upgraded AI-driven ad recommendation models accelerated ad revenue growth to 20%,” he said. “AI spending remains in line with previously guided full-year numbers.”
However, Su pointed to the slowdown in gaming revenue growth as a negative factor, adding that the main cause of the slowdown was “not the underlying demand issue, but the timing of the Lunar New Year, which affects revenue recognition.”
