The Information Staff

Tencent Holdings said on its earnings call that China's AI chip shortage is beginning to ease, signaling the company will increase spending on AI infrastructure in the second half of 2026. Chief Strategy Officer James Mitchell indicated the spending boost will be enabled by greater availability of China-designed AI chips. The statement suggests that domestic chip supply constraints, which have limited AI deployment across Chinese tech companies, are starting to loosen as local semiconductor efforts mature.

China's national AI fund is in talks to invest in DeepSeek, the AI startup owned by hedge fund High-Flyer, in a funding round that would value the company at over 300 billion yuan, or approximately $44 billion. The investment represents a significant show of state support for a homegrown AI competitor as China seeks to build domestic capabilities in large language models and generative AI. The valuation places DeepSeek among the world's most valuable AI companies, reflecting both the capital intensity of the sector and Beijing's strategic focus on AI development.

DeepSeek, the Chinese AI startup owned by hedge fund High-Flyer Capital Management, is raising outside capital for the first time and has attracted interest from major investors. Tencent and Alibaba are now in talks to invest at a valuation exceeding $20 billion, a significant jump from the company's initial $10 billion+ target announced days earlier. The round appears to have generated substantial investor appetite, pushing the valuation higher as discussions progressed.