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Chinese gaming giant Tencent posting a fourth-quarter earnings beat on the top and bottom lines. The company's seen a 90% increase in profit from the same period in 2023. In addition to gaming, Tencent has expanded into artificial intelligence, releasing its latest model on Tuesday. The company reporting AI cloud revenue doubled for the year, but you've still got the ADRs here moving to the downside just a bit. I think it's really interesting, Jessica, in the context of what we've seen just in terms of the run-up in China and specifically Chinese tech. We had BYD announcing that five-minute EV charging yesterday. We saw that putting pressure on Tesla. Obviously, the deep seek news putting pressure on a lot of the AI names. So I've been wondering, are we entering into a period of AI dominance from China? But then Bank of America throwing some cold water on that idea this morning. What are you looking at in the China trade?

So, I think it's really interesting and almost reminiscent of 2022 in our markets when things switched over and AI started dominating the narrative and held up the S&P 500, which means it could perhaps even be something narrow. It might be the other securities that aren't going to do so well. But it's so reminiscent as the fact as they announced some buybacks. Their advertising has done well, but they're ramping up spending on chips and servers. It is it's almost like they're pulling from our playbook, which is great. We've got something to go off of, and we can understand what's going to happen. Um, but if everything is this multiple expansion, the follow-through from that is earnings follow through. So now we have to see earnings follow through. This is a great beat. I want to see that consistently. And if there is still earnings follow through, and what I think we're missing and what Wall Street, even coming back to the US and bringing it to this competition we have within AI, we are focused on that chips factor. Nvidia yesterday told us about the software layer and inference and how it's really an AI ecosystem. So what we've learned is even though these big dominant players have a lot of spending, are doing well in AI, they're using AI to make more AI, to make more AI. And it's it it's compounding, leading to consistently beating earnings, and perhaps it's just not understood, and therefore earnings expectations keep being revised because of the uncertainty around AI.

Right. Right. And a lot of efficiencies from that AI. I did think it was interesting quickly in this Bank of America note where they do call for correction in China stocks here. They cite their trip to Shanghai, saying long only investors on the mainland are getting nervous, worrying about a lack of improvement in jobs, deflation, and credit demand, and the impact of geopolitical tensions they call overlooked. So I thought that was really interesting. They're calling for some similarities in some of the bubbles that we've seen here in the United States. I wonder to what extent though, if if we take your point, are we just going to see what happened in 2022, where there was that selloff, and now we've seen tech names completely recover since then.

Absolutely. They they recovered very well, but they also held up the market for a brief, brief moment. And perhaps even stopped our markets from going into full bear market territory. There there's literally the Magnificent 7 was holding up the stock market from an earnings perspective quarter over quarter, and it didn't take until really the 2024 last year until it broadened out inclusive from an earnings perspective.