Tencent Holdings (HK0700) reported a negative free cash flow of RMB 13.8 billion in the second quarter of 2026, as the net cash from operating activities of RMB 52.7 billion was more than offset by capital expenditures, media content, and lease liability payments. The operating cash flow included significant AI-related prepayments to meet the demand for AI infrastructure and cloud services. After excluding prepayments for computing power purchases, the free cash flow was RMB 37.6 billion.