Chinese internet giant Tencent reported better-than-expected first-quarter revenue thanks to growth in gaming, as the company's strategic focus on artificial intelligence deepens, AFP reported.

Shenzhen-based Tencent operates the multifunctional WeChat app in China and is a major player in the global gaming industry.

The company is also present in cloud technology, entertainment, and artificial intelligence—the latter of which has seen a surge in interest among Chinese tech giants following the shocking launch of the advanced chatbot DeepSeek earlier this year.

Tencent's revenue for the quarter ended March 31 totaled $125.0 billion, according to a report filed with the Hong Kong Stock Exchange, representing a 13% increase compared to the same period last year.

The figure is slightly higher than Bloomberg's forecast of 175.7 billion yuan.

In its sales breakdown, Tencent said domestic game revenue rose 24% year-on-year, while international games grew 23%.

The results show that net profit also saw a moderate increase in the first quarter, jumping 14% year-on-year to 47.8 billion yuan.

"AI capabilities have already contributed significantly to our business, such as results-based advertising and evergreen games," the company said in a statement.

Tencent added that it had increased spending on "new AI capabilities," including integrated features in the WeChat app.

Chinese tech giants have been directing resources toward the competitive field of AI since the launch of the DeepSeek chatbot in January.

The little-known Chinese company caused a global sensation because it appeared to have developed the chatbot at a fraction of the cost of Western industry leaders such as the US's OpenAI.

Tencent began testing its own AI model earlier this year, which the company says could surpass DeepSeek.

Tencent was among the tech companies affected by the massive internal crackdown that began in 2020 when authorities canceled the planned massive listing of fintech company Ant Group, which is linked to Alibaba.

In recent months, Beijing has signaled a renewed friendliness toward tech companies, but broad restrictions on minors' access to video games remain in place. |BGNES