BEIJING: Chinese businesses that spent years building humanoid robots capable of running, dancing, and doing backflips are now pouring money into a different challenge: creating AI that makes such machines usable for a wider range of vocations. The trend is fuelling an investment boom in embodied AI, which centers on software that enables robots to sense their environment, learn new tasks and adapt without needing to be programmed for every activity.
Chinese AI businesses raised 93.5 billion yuan ($13 billion) in 322 agreements in the first half of 2026, five times more than a year earlier, data analysis firm ITjuzi said. Funding is increasingly going to professional robot-intelligence investors and manufacturers.
With competition driving down hardware prices, robot companies have “concluded that the margin won’t come from the hardware but from the brain,” said Dermot McGrath, founder of Shanghai-based technology consultancy ZenGen Labs.
In the burgeoning sector, a new front in the US-China tech conflict is opening. American companies are ahead in some advanced robot artificial intelligence systems, but Chinese developers are hoping their manufacturing muscle and access to real-world training data will help them challenge their US rivals, according to interviews with founders and top executives at five Chinese robotics firm, and industry analysts.
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