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🟠 China’s AI stocks are plunging

🟠 China’s AI stocks are plunging

Asiabits News

November 02, 2026

China’s AI and chip stocks lose $480 billion

China’s AI boom has suffered a severe setback on the stock market. By the start of the week, the STAR50, an index of major Chinese chip and technology companies, was around 40% below its peak. About $480 billion in market value had disappeared in less than four months. Selling continued through the end of the week.

The slump hits China’s hopes of taking a leading role in AI and robotics. Investors had already priced in substantial profits.

State backing offered no protection against losses

One of those investors is Chen Wensheng, a small-business owner from the southern Chinese province of Hainan. He invested during the rally. The involvement of state-backed funds in companies such as robot maker Unitree gave him confidence. Now he and his friends are nursing losses, Reuters reports.

Expectations had run far ahead. Even after the fall, the STAR50 was still valued at roughly 100 times its companies’ past annual earnings at the start of the week. Share prices therefore continue to assume strong profit growth.

The prospect of further restrictions on Chinese technology in western markets is also weighing on the outlook. Companies investing heavily in new products eventually need enough customers to pay for their development.

Unitree sells more and keeps investing

Unitree’s latest results show the tension. Third-quarter revenue rose 70% year on year to 665 million yuan, about $100 million. Net profit fell by just over 17%.

The company had more than tripled its spending on research and development. Money is going into AI models, computing capacity and its engineering team. Demand is growing while Unitree spends heavily on its next generation of robots.

That can disappoint a shareholder. For the development of the machines, these investments matter. Share prices and technological progress are moving at different speeds.

AgiBot wants to measure the work robots do

Practical deployment is also receiving more attention within the industry. On Thursday, AgiBot introduced a new metric called “Worken” in Shanghai. It aims to capture how many robots are actually working, how long they operate without human help and how much useful work they complete.

It is a manufacturer’s proposal. The direction is revealing nonetheless: companies increasingly need to show what their machines can do in everyday use. The number of robots shipped provides little answer on its own.

A machine can already take on work while its manufacturer still faces high development costs. The benefits can reach businesses before manufacturers’ profits catch up with stock-market expectations.

Further reading: How are Unitree robots controlled? →

RATHER WATCH THAN READ?

A carmaker wants a robot in your living room

Chery unveils its 90-centimetre Mobo and opens preorders worldwide.
Hesai's 3D scanner, JLC and RoboParty show ways to speed up robot development.
Robots in Japan learn to skateboard, while Sony's AI takes on table tennis.

Watch the episode

FROM THE TEAM

Conversations from Seoul. At the Asia-Pacific Conference of German Business (APK) this week, we recorded new conversations for the Made in China podcast. Our guests included Antonin Finkelnburg, Cyn-Young Park, Leon Vin Sen, Agatha Kratz and Lynn Kuok. The episodes will follow in the coming weeks.

Until then, the latest English-language episode of Made in China features Dinny McMahon, Head of China Markets Research at Trivium China. We discuss why China’s industrial strength coexists with weak domestic demand. Listen in English.

OUR PARTNER

How safe is a humanoid working alongside people?

Companies planning to test robots in their operations need to establish how they will work alongside people and which safety requirements apply. Humanoid Europe 2026 in Munich on November 5 and 6 brings together specialists from Unitree, Bosch and Fraunhofer. The programme covers functional safety, cybersecurity and applications in manufacturing and logistics.

Asiabits supports the event as an affiliate partner. Through our partner link, you can reveal a code for 15% off every pass type, including the Virtual Pass, until November 5.

Check the programme and reveal your 15% discount

INFOGRAPHIC OF THE WEEK

China wants nuclear power to provide more steady electricity. The government is targeting around 110 gigawatts of installed capacity by 2030, compared with just over 62 gigawatts at the end of 2025. Reaching that target would mean growth of roughly three quarters in five years.

Alongside wind and solar farms, China is planning plants whose output depends less on the weather. The amount of new capacity that reaches the grid will depend on construction progress. The chart compares the existing fleet with a policy target, rather than plants already completed.

REPORT OF THE WEEK

Bain & Company, Technology Report 2026: The report describes a potential $900 billion economic opportunity for physical AI. Its calculation assumes that tools including better simulations and robotics reduce research and manufacturing costs by 10% in selected industries. Read the report and open the PDF in English.

Our take: That assumption offers a useful pilot question: What does a specific task cost today, and how will an improvement be measured? These questions belong in the preparation for our manufacturer visits in China.

5 STORIES YOU MISSED LAST WEEK

🇯🇵 Japan’s central bank plans to more than double its annual ETF sales. The planned pace will rise from 330 billion to 860 billion yen. Those amounts refer to the book value of its fund holdings, rather than their current market value. The change takes effect on January 1, 2027. The Bank of Japan will continue spreading sales over time. ETFs are funds that track a stock-market index. Japan’s stock market will therefore face a larger planned annual volume of sales from a major institutional investor.

🇯🇵 FANUC plans new AI vision for 2027. A robot is designed to recognise and pick cylindrical workpieces without being taught each new shape individually. The company is demonstrating the application with a lathe at the JIMTOF machine-tool fair. FANUC says the system also recognises transparent and reflective parts that conventional cameras struggle with. Shipments of AI Masterless Vision are scheduled to start in January. For factories with frequent product changes, shorter setup times would offer a practical benefit to test with their own workpieces.

🇸🇬 Singapore tests up to 470 alloys a day. Research agency A*STAR is combining AI with automated laboratories to accelerate materials development. The new MARVEL-AI programme has an initial S$150 million, about US$117 million, in government funding. A*STAR says its laboratory can test up to 470 different metal alloys daily. Results feed back into models to guide further experiments. The programme aims to shorten the path from laboratory to industrial use; manufacturing a suitable material at scale remains the next critical step for producers.

🇰🇷 Samsung grows quarterly revenue by 14%. The electronics group reported another sequential increase in the third quarter. Its memory business achieved record revenue and operating profit, according to the company. Drivers include high-speed HBM4 memory for AI computers and storage drives for servers. Samsung plans to prioritise these products and secure multiyear supply agreements. Its latest results also describe constraints on production capacity. Memory availability therefore remains an important consideration in the expansion of AI data centres.

🇨🇳 BYD grows overseas sales by 137%. The carmaker sold about 1.3 million vehicles in the third quarter. Overseas markets accounted for 550,704, while sales in China fell around 12%. Net profit rose 28% to about 10 billion yuan, roughly $1.5 billion. Revenue increased approximately 14%. Overseas business is offsetting weaker demand in China. European manufacturers and dealers face growing competition from a producer whose expansion increasingly depends on markets outside its home country.

ALSO LAST WEEK

🇸🇬 NCS plans more than 300 client-embedded AI engineers. The IT services firm will expand its current team of around 100 over two years and has opened an AI Mission Centre. The specialists work directly within customer teams to integrate AI applications into existing workflows.

🇮🇳 IIT Guwahati and Tata plan two semiconductor training pathways. Diploma and bachelor-level programmes will include practical instruction in assembling, testing and packaging chips. A joint centre will connect education with research, preparing talent for India's expanding semiconductor industry.

🇨🇳 China's manufacturing PMI falls to 49.3. The official purchasing managers' index is back below the 50 threshold separating expansion from contraction. High-tech and equipment manufacturers remain above it at 51.3 and 50.6, making a sector-specific view useful when assessing suppliers and sales prospects.