Tencent executives discuss AI business profits: WorkBuddy's paid user gross profit margin is quite good.

On August 12, during Tencent's Q2 2026 earnings call, Tencent's Chief Strategy Officer James Mitchell discussed the profitability of Tencent's AI cloud business, stating that domestic token prices are indeed very low, but the production costs for domestic tokens are also extremely low, far below the general perception and estimates in the market. Therefore, even with low prices, the token business can still maintain a positive gross margin. He mentioned that the gross margin for WorkBuddy's paid users, as well as the gross margin for Tencents model services, can now compete with the overall gross margin of Tencent Cloud. Overall, WorkBuddy's gross margin is relatively lower because it includes a portion of free users, with Tencent using this segment to subsidize users in order to drive market share growth, but the paid segment has already generated a quite impressive gross margin.