Pony Ma, the Chief Executive and Co-founder of Tencent Holdings, addressed concerns about the company’s gaming business challenges during Tencent’s annual meeting in Shenzhen on Monday (Jan 29). Ma admitted that Tencent has faced significant challenges in its video games business, emphasizing that competitors have delivered new hits while Tencent has been resting on its laurels. Video games currently contribute more than 30% to Tencent’s overall revenue.
Ma’s comments, reported by Chinese media outlet Jiemian, underscore the competitive landscape in the gaming industry and raise questions about Tencent’s ability to maintain its status as China’s leading tech company amid increasing competition and emerging disruptive technologies.
Acknowledging the competition’s impact, Ma stated, “Gaming is our flagship business … But in the past year, we have faced significant challenges. We have found ourselves at a loss, as our competitors continue to produce new products, leaving us feeling like having achieved nothing.” He noted that Tencent’s recent game launches did not perform as well as anticipated.
This statement comes at a time when Chinese game developers miHoYo and NetEase have garnered attention with hit titles like Genshin Impact and Eggy Party, outshining Tencent in certain aspects. While Tencent’s earlier hits such as Honor of Kings and PUBG Mobile continue to generate robust revenue, recent releases are falling short of expectations.
In contrast, Ma highlighted Tencent’s progress in artificial intelligence (AI) development, noting that the company has caught up in this domain. He mentioned, “We can finally follow the pace of the first-tier companies. We don’t count ourselves as the most leading, but at least we are not too behind.” Ma emphasized Tencent’s focus on integrating its “Hunyuan” AI model into various business scenarios to enhance efficiency.
Addressing the short-term outlook for AI applications, Ma stated, “In the short term, within the next one or two years, I feel like there will not be a massive, AI-native application yet.” He highlighted Tencent’s efforts in live-streaming e-commerce, expressing the need to innovate within the existing WeChat platform, which remains robust but is over a decade old.
Tencent did not respond to requests for comments on the matter.