This article first appeared on GuruFocus .
Tencent Holdings ( TCEHY ), the Chinese gaming, social-media and cloud giant, released its Hy4 preview weights Friday with the stock priced at $58.01. The headline number is enormous: 770 billion backbone parameters. The twist is efficiency. Hy4 activates only 49 billion parameters per token, putting just 6.4% of the full network to work on each request.
The model can process a one-million-token context window and is set to power Tencent's CodeBuddy and WorkBuddy products. In Tencent's internal test of 163 employees across 203 engineering tasks, Hy4 scored 2.99 out of four. That topped GLM 5.3 at 2.92 and Kimi K3 at 2.94but only by 2.4% and 1.7%, respectively. This is a lead, not a knockout.
The stock's valuation leaves room for Hy4 to matter. Tencent's $58.01 price sits 13.78% below its $67.28 GF Value estimate, signaling that investors are not yet paying full price for the company's AI ambitions. Open sourcing could widen adoption and sharpen the model through outside testing, but it also hands competitors a closer look at the technology. Tencent now needs to turn Hy4 into better products, paying customers and stronger growth. Otherwise, 770 billion parameters remain a spectacular numbernot an investment catalyst.
