Key Points:
- Tencent upgrades its foundational AI model, Hy3.
- Hy3 offers big advances in reasoning and coding, available on Tencent products.
- New Chief AI Scientist, Yao Shunyu (ex-OpenAI), leads the effort.
- Tencent is focusing on “agentic AI” and plans $5 billion in investments.
Tencent Holdings Ltd. has revealed a big upgrade to its core AI model, marking a significant moment for China’s most valuable company. This move tests its standing in the fast-paced AI race, especially since it hired a top researcher from OpenAI.
On Thursday, the social media giant showed a preview of its Hy3 model, calling it its most powerful AI yet. The Hy3 model, named after Tencent’s main Hunyuan platform, represents a major step forward in areas like complex thinking and coding. This new model, which supports OpenClaw, is now available across many Tencent products, including its chatbot, coding tool, and QQ.
Tencent is working hard to catch up with competitors like ByteDance Ltd. and Alibaba Group Holding Ltd., as well as newer companies like DeepSeek. Their goal is to release affordable AI models to a market of over a billion internet users. This effort is now led by Chief AI Scientist Yao Shunyu, a former OpenAI expert. He is one of many U.S.-trained researchers returning home to drive AI development in China.
Executives said last month that the Shenzhen-based gaming and social media giant has reorganized its research team to improve the quality of its training data. They also promised to double investments in AI initiatives to more than $5 billion this year.
Tencent is betting on a shift towards “agentic AI”—software that can perform complex tasks with little human help. The company believes this could change who leads the world’s biggest internet market.
Jefferies analysts, including Thomas Chong, noted that Tencent is well-positioned for the agentic AI opportunity, and the new model is a big improvement. They believe this is “just the beginning and expect a large parameter model to come next.”
Last month, the WeChat operator launched several products using the popular OpenClaw framework. It is also developing an AI agent inside its main super-app to help users automate tasks, from ordering a ride to booking hotels.
Like Alibaba, Tencent has invested in several AI startups, including Moonshot AI and StepFun. It hopes these connections will boost the use of computing power for its growing cloud business. Bloomberg News also reported that Tencent is now discussing joining the first round of funding for Chinese AI pioneer DeepSeek.
