Embodied AI sector posts robust growth

China's embodied artificial intelligence industry registered robust growth and showcased multiple positive trends in the first five months of this year, according to the latest data from the State Taxation Administration.

The surge aligns with the country's 15th Five-Year Plan (2026-30), which designates embodied AI as one of six major future industries alongside quantum technology and biomanufacturing. Defined as "intelligent agents with physical carriers", embodied AI enables a crucial leap for the smart tech from merely "knowing" to "doing". As technologies like large AI models and motion control mature, embodied AI has emerged as a core track in global frontier technology competition, accelerating the sector's overall development.

Chinese enterprises are actively innovating in this arena. Guo Yandong, founder and CEO of AI2 Robotics, said that while many rely on humans wearing VR headsets to operate robots for data collection, his team focuses on designing model structures that closely mimic the human brain. "Compared to conventional models, these brain-inspired designs require less training data and offer higher learning efficiency for robots," Guo said, adding that such technical solutions have already been implemented and verified.

This acceleration is clearly reflected in the country's expanding corporate landscape. Data from corporate information provider Qichacha show that as of May 2026, China had 3,025 existing enterprises related to embodied AI.

Registration numbers have climbed steadily over the past five years, with 408 new companies added in 2025 alone — a year-on-year surge of 119.35 percent. Notably, mature enterprises established for over a decade account for 36.26 percent of the total, underscoring a solid industrial foundation.

Driving this momentum is a rapid expansion in overall sales. Between January and May, sales for embodied AI enterprises jumped 22.4 percent year-on-year, accelerating from the 13.9 percent growth recorded for the entirety of 2025. A breakdown of the sector reveals that sales of robot bodies and complete machines, AI algorithms and software integration, and system integration and industry applications surged by 30.1 percent, 24.5 percent, and 27.9 percent, respectively.

The data also indicate that these products are effectively meeting the transformation demands of domestic businesses. Purchases of embodied AI robots by industrial enterprises skyrocketed 2.3-fold during the five-month period, highlighting a deepening integration into industrial production. Correspondingly, revenue from supporting information system services — such as system integration, deployment, and maintenance — soared 1.9-fold.

Furthermore, the booming sector is fueling downstream high-tech development, with sales to the software and information technology services sector and the scientific research and technical services sector accounting for 25.5 percent and 12.7 percent of the industry's total revenue, respectively, marking notable increases from a year earlier.

Geographically, a clear industrial clustering effect has taken shape. Nearly 90 percent of the country's embodied AI enterprises are concentrated in the provincial-level regions of Guangdong, Beijing, Shanghai, Zhejiang and Jiangsu. Backed by active market entities and a comprehensive industrial chain, Guangdong dominates the national market, generating a staggering 78.7 percent of the sector's total sales revenue from January to May.

Other regions are also making significant strides. Tianjin, for example, has formed a complete industrial chain covering core components, body manufacturing and system integration. The city is home to 104 enterprises in this chain, which generated over 27 billion yuan ($3.97 billion) in revenue in 2025. In the first quarter of 2026, the chain's output value grew by 10.1 percent year-on-year, fostering a batch of globally competitive "hidden champion" enterprises.

This rapid progress has caught global attention. "The vast majority of robotics researchers worldwide can hardly hide their envy when looking at China," said Bradley Nelson, a member of the Swiss Academy of Engineering Sciences. "This reflects the Chinese government's admirable foresight and long-term planning in continuously investing in the robotics industry." He added that China's astonishing advancements place it at the global forefront of intelligent industry R&D with exciting prospects.

To sustain this momentum, tax authorities will continue to precisely implement supportive tax policies, innovate service mechanisms, and incentivize innovation investments, an STA spokesperson said, adding that these efforts will help cultivate the embodied AI sector and inject new impetus into the country's high-quality development.

renqi@chinadaily.com.cn