Tencent turned down 30% instant margin to feed its own models
· re: Tencent says it could make instant profits on $53B hardware splurge by renting it out (The Register)
On its Q2 call Tencent said it spent US$53B on hardware in the quarter, holds offers to rent that capacity out at more than 30% profit over what it paid, and is declining them to train its own Hunyuan models instead, for “superior economic returns over the longer term”.
When a hyperscaler refuses instant margin to feed its own models, that is the market pricing what owned capability is worth. I made the longer argument in the repatriation essay: the initial play is renting intelligence, the long play is owning it. Tencent just put a floor under the thesis, and the floor is $53 billion.