Tencent has signed a five-year lease worth roughly $7bn for about 100,000 advanced AI chips from Oracle, the Financial Times reported on 2 October 2026, citing people familiar with the matter. The chips sit in several Oracle data centres in South-East Asia and are not available in China.

The deal, signed this year, marks the Chinese company's largest overseas lease arrangement with a US cloud provider. Tencent is paying about 30% of the value upfront, according to FT reporter Zijing Wu. US export rules permit overseas cloud leases of this kind, the FT noted.

Why lease abroad?

The chips Tencent gains access to cannot be sourced at home. Export controls have cut Chinese buyers off from the most advanced US-made AI accelerators, and renting compute through cloud providers outside China remains a legal workaround under US rules.

Chinese tech groups have taken this route before. UK cloud firm Nscale's filings showed that ByteDance accounted for nearly 75% of its 2025 sales.

What does the deal mean for Tencent's finances?

Tencent's cash flow turned negative in the second quarter, at RMB 13.8bn ($2.06bn) — the first negative figure in more than a decade, according to the FT. Chief financial officer John Lo attributed the result to heavy AI infrastructure spending and prepayments for compute, DatacenterDynamics reported.

Tencent president Martin Lau has defended the outlay publicly: "We're comfortable in making significant investments in AI because not only is there a substantial upside potential, there is also clear downside protection."

Executives laid out a deployment sequence for the compute:

• Training larger Hunyuan models first
• Running those models in inference afterwards
• Potentially renting capacity out through Tencent Cloud later

Tencent also holds a stake in Chinese chipmaker Enflame, whose shares nearly tripled in their Shanghai trading debut in September.

Does the deal help Oracle?

Oracle shares barely moved on Thursday after the report, according to Investor's Business Daily. The stock had fallen 29.5% this year going into the day.

The company's free cash flow has stayed below zero for several quarters, IBD noted, driven by AI spending. Oracle is currently spending more on data centres than it earns in a quarter.

The Tencent contract adds contracted revenue to that build-out, though the report did not immediately shift investor sentiment.