[News] China’s AI Toy Market Surges With 30+ Funding Rounds and Hot Launches From Huawei and UBTECH

An unexpected AI market is emerging in China, as companion toys designed for interaction and comfort surge in popularity. According to Commercial Times, Chinese tech giants including Huawei, JD.com, and UBTECH Robotics have recently entered the AI toy market. The report notes that these so-called “AI toys” are not traditional electronic pets but intelligent devices equipped with AI models and emotional-computing capabilities. They feature memory and contextual awareness, enabling them to converse with users in a human-like manner through voice and facial recognition.

China’s Tech Giants Race Into the AI Toy Market

On December 1, as noted by Ifnews, UBTECH Robotics introduced new additions to its “Meng UU” family series. This marks the company’s second AI companion product since June 2025. The device is already available for preorder through Tmall’s Meng UU flagship store and UBTECH Robotics’ Douyin livestream channel, with an initial limited release of 2,000 units.

Huawei has also joined the competition with its own plush AI companion. According to Gizmochina, the company unveiled its first AI-driven emotional pet, Smart Hanhan, during the recent Mate 80 series launch. Priced at 399 yuan (about $56), the product went on sale on Huawei Mall, where all three color versions quickly sold out. As noted by Notebookcheck, Smart Hanhan features circular eye displays that respond to touch or voice commands, along with speakers, microphones, and a chatbot app designed for HarmonyOS 5.

Other major Chinese players such as e-commerce platform JD.com and smartphone brand Honor have also entered the AI toy market, as noted by Ifnews. The report further indicates that venture capital firms are actively investing in the sector, with public data showing more than 30 funding rounds since 2024 and prominent investors including IDG Capital and HongShan participating. Meanwhile, more than 20 AI toy–related startups, including Haivivi and Robopoet, have secured financing, the report adds.

The AI toy market shows strong growth potential. As noted by Ifnews, according to the AI Toy Consumption Trend White Paper jointly released by JD.com and the Shenzhen Toy Industry Association, the global AI toy market is expected to exceed 100 billion yuan by 2030, with an annual compound growth rate of over 50%. China’s domestic market is also projected to surpass 10 billion yuan, with a compound annual growth rate of more than 70%.

Commercial Times further notes that AI toys are highly attractive to the hardware industry due to their strong profit margins. According to sources cited by the report, entry-level AI toys priced between 300 and 400 yuan typically carry gross margins of around 50% to 65%. Mid- to high-end models priced between 1,500 and 3,000 yuan can reach gross margins of 70% to 85%.

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(Photo credit: Huawei)