Tencent to Issue 6.7 Trillion Won in Bonds Soon ... AI Investment

[Financial News] Tencent Holdings Limited is expected to soon complete a bond offering worth about $5 billion (6.674 trillion won), with most of the proceeds reportedly going toward semiconductor purchases to power artificial intelligence (AI).
Major foreign media reported on the 12th that Tencent made the announcement that day during a conference call with investors.
Tencent said during the call that the bond offering prices could be finalized as early as the 13th. The offering comprises $1.5 billion–$2 billion in dollar-denominated bonds and 20 billion–25 billion yuan ($3 billion–$3.7 billion) in offshore yuan-denominated bonds.
Tencent executives said the proceeds would be used mainly for AI-related capital expenditures, most of which would go toward semiconductor purchases. Instead, Tencent reportedly has no plans to issue shares or convertible bonds.
Tencent is increasing its AI-related investment to catch up with competitors such as ByteDance and Alibaba. In the second quarter (April–June), its capital expenditures on AI projects and computing totaled 52.8 billion yuan, up 176% from the same period last year.
Tencent’s capital expenditures are likely to remain high for the rest of this year and through 2027. If they remain at the second-quarter level, the annual total is expected to slightly exceed 200 billion yuan.

[email protected] Lee Seok-woo, International Affairs Correspondent Reporter