Internet of Things Photo: IC

Major Chinese internet firms have reported sound revenue growth for 2023, boosted by the use of advanced technologies like artificial intelligence (AI), as well as measures to reduce costs and raise efficiency.

As a leading force in China's private economy, the revival of the internet sector sends a warm and encouraging signal to the private sector as a whole, experts said.

Dismissing some Western media outlets' bad-mouthing of China's private economy, experts said that private enterprises have more opportunities and room to develop, thanks to the sustained recovery of the domestic market, accelerated consumption upgrading and policy support. The country's high-level opening-up and international cooperation also offer them more opportunities to explore overseas.

In 2023, Tencent Holdings' revenue reached 609 billion yuan ($86 billion), up 10 percent on a yearly basis, according to the company's financial results published on Wednesday night.

Ma Huateng, chairman and CEO of Tencent, highlighted some breakthroughs that the company made last year. He said that the company's large language AI model Hunyuan has developed into a top-tier foundation model with superior performances in numerical reasoning, logical inference and multi-turn conversations.

Intelligent learning firm NetEase said that its net revenue in 2023 totaled 103.5 billion yuan, up 7.25 percent year-on-year, while research and development (R&D) investment was almost 16.5 billion yuan.

Other internet firms including JD.com, Baidu and Kuaishou achieved better-than-expected results for last year, according to their financial reports.

A glimpse at major Chinese internet firms' financial reports shows that most of them stress AI-enabled growth. Accelerating R&D investments in AI and integrating AI technologies with their own businesses will be the core for internet firms to maintain sustainable and healthy growth, Liu Dingding, a Beijing-based tech analyst, told the Global Times on Thursday.

The notable performance of these  internet firms is a slap in the face of Western media reports that claim the Chinese government is cracking down on the internet sector and the private economy, analysts said, noting that the private economy has embarked on stable recovery trajectory after witnessing some challenges.

China has long attached great importance to the private sector, encouraging it to play a bigger role in stabilizing growth and promoting structural adjustment and innovation, Wang Peng, an associate research fellow at the Beijing Academy of Social Sciences, told the Global Times.

Policymakers are seeking to reduce private enterprises' burdens, optimize the business environment and increase financial support, creating a more favorable and comfortable environment for the development of private companies, he said.

According to data released by the National Bureau of Statistics on Monday, private-sector investment in fixed assets rose 0.4 percent year-on-year in the first two months this year, reversing a decline observed in 2023. Private-sector investment in manufacturing, hotels, catering and transportation all registered double-digit gains.

Private-sector investment is an important foundation for the development of the private economy and barometer of the vitality of the private economy, Liu Sushe, a deputy head of the National Development and Reform Commission (NDRC), said at a press conference on Thursday.

The NDRC will boost private investment with "more strength, more measures," Liu said, noting that the authorities are seeking to formulate a law aimed at promoting the development of the private sector.

Economic experts and media outlets often use the numbers 50, 60, 70 and 80 to describe the private sector's contributions to the Chinese economy. The private sector contributes more than 50 percent of the country's tax revenue, 60 percent of its GDP, 70 percent of its technological innovation, and more than 80 percent of its urban employment, official data showed.

In order to further revive the confidence of the private sector, more efforts should be made to strengthen policy support - for example, greater tax and fee cuts - as well as optimization of the business environment and financial support, Wang said.

Private enterprises should increase R&D investment to enhance their innovation capability and nurture new growth points, Wang said, noting that private enterprises are being encouraged to "go global" and participate in international competition.

A Beijing-based capital market observer told the Global Times on Thursday that the nation's financial regulators should improve the multi-faceted capital markets and provide direct funding channels for small and medium-sized private enterprises.

For example, a market mechanism should be improved to ensure that financial institutions, including commercial banks, insurers and securities firms, jointly assume fund-raising risks in a bid to enhance private enterprises' willingness to raise funds and reduce their funding costs, the expert said.