The latest rally in Tencent stock price reflects a rotation back into China tech names amid easing geopolitical tensions. Analysts believe strong free cash flow and dividend potential could underpin valuations, even if global market sentiment remains cautious. Another critical point is that Huawei’s major customers have primarily used its most advanced semiconductors only for inferencing. And Chinese companies have largely depended on Nvidia’s high-performance processors to train large-scale models. Of course, I cannot ignore a Bloomberg report stating that Huawei is working on a revamped next-generation Ascend chip, beyond the announced models, which could be powerful enough to train AI algorithms for major clients. However, since commercialization of that product isn’t expected until at least 2027, I don’t see much reason for concern at this stage. Moreover, The Information reported last month that Alibaba and Baidu have begun using their own internally designed chips to train AI models. The key point, however, is that those chips are used for smaller AI models, while both companies continue to rely on Nvidia chips for developing their most advanced models. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest and most accurate reporting. This story was reviewed by MarketBeat's editorial team prior to publication. Please send any questions or comments about this story to [email protected].
