China’s embodied artificial intelligence (AI) sector experienced significant growth during the first five months of 2026, reflecting its increasing importance within the country’s strategic industrial framework. Latest figures from the State Taxation Administration reveal strong expansion across multiple metrics, underscoring the sector’s role as a core component of China’s 15th Five-Year Plan, which emphasizes embodied AI alongside other emerging technologies like quantum computing and biomanufacturing.
Embodied AI refers to intelligent systems with physical bodies capable of interacting with the real world, marking a shift from AI’s traditional focus on data processing to actionable tasks. This convergence of advanced AI models and motion control technologies has propelled embodied AI to the forefront of global technological competition.
Chinese companies are actively innovating within this field. Guo Yandong, founder and CEO of AI2 Robotics, highlighted efforts to develop brain-inspired AI models that require less training data while enhancing learning efficiency in robots. These innovations have reportedly been implemented and validated, demonstrating practical advances beyond conventional methodologies that often depend on human operators wearing VR devices for robot control.
By May 2026, the number of embodied AI-related enterprises in China reached 3,025, with 408 new companies registered in 2025 alone, marking a 119.35 percent increase compared to the previous year. Nearly 36 percent of these companies have been established for over a decade, illustrating a mature and stable industrial base. Sales revenue from embodied AI businesses grew 22.4 percent year-on-year in the first five months of 2026, exceeding the 13.9 percent growth recorded throughout 2025.
Breakdowns of sector performance show significant gains across product categories: robot bodies and complete machine sales increased by 30.1 percent, AI algorithms and software integration by 24.5 percent, and system integration and industrial applications by 27.9 percent. Industrial enterprises’ purchases of embodied AI robots more than doubled during the same period, reflecting deeper adoption in manufacturing and production. Additionally, revenue from associated information system services, including system integration and maintenance, nearly doubled.
The sector’s expansion also supports downstream high-technology fields. Sales to the software and information technology services industry accounted for 25.7 percent of total revenue, while scientific research and technical services made up 12.7 percent—both showing significant year-on-year increases.
Geographically, the embodied AI industry is concentrated in key provincial-level regions such as Guangdong, Beijing, Shanghai, Zhejiang, and Jiangsu. Guangdong Province dominates, generating nearly 79 percent of the sector’s sales revenue in the early months of 2026. Other regions like Tianjin have developed comprehensive supply chains covering core components, manufacturing, and system integration, fostering over 100 companies and producing nearly 28 billion yuan ($3.97 billion) in revenue in 2025. This area saw output growth of more than 10 percent in the first quarter of 2026 and has nurtured several globally competitive firms.
International experts have noted China’s rapid advancement in robotics and intelligent industry research and development. Bradley Nelson of the Swiss Academy of Engineering Sciences praised the Chinese government’s strategic investments and long-term planning that have propelled the sector to a global leading position.
To sustain this growth trajectory, Chinese tax authorities have committed to maintaining supportive tax policies and enhancing service mechanisms to encourage continued innovation and investment in embodied AI. These efforts aim to strengthen the sector’s contribution to the country’s broader goal of high-quality economic development.