Tencent and Honor Forge Partnership on Cloud and AI

By Sherry Qin

Chinese tech giant Tencent Holdings and budget smartphone maker Honor Device have entered a long-term partnership focused on cloud computing and artificial intelligence.

Under the agreement, Tencent will provide its cloud infrastructure and data processing and search tools to Honor while the two companies enhance their jointly developed AI coding assistant, Tencent said Friday on its official WeChat account.

Tencent, China's largest company by market value, generates most of its revenue from gaming and social platform, but has ramped up investments in cloud computing and AI technologies, seeking to capitalize on growing demand.

It competes with Alibaba and ByteDance in China's crowded cloud market. Tencent and Bytedance are also reportedly in talks with Apple to integrate their AI models into iPhones in China, according to a media report Thursday.

Honor, based in Shenzhen, is a leading budget smartphone brand in China, known for its competitive pricing and sleek designs. It ranked fifth in the Chinese smartphone market by third-quarter shipments, behind rivals Vivo and Apple, according to International Data Corporation.

Honor was spun off from Huawei Technologies in 2020 to bypass U.S. sanctions that restrict Hwawei's access to chips and other American-made technologies.

Write to Sherry Qin at sherry.qin@wsj.com