On September 29, the Policy and International Cooperation Institute of the China Internet Network Information Center (CNNIC) released the "Report on the Development of Generative AI Applications (2026)" at the 2026 (7th) China Internet Infrastructure Resources Conference. According to the report, China's generative AI user base surpassed 700 million in the first half of 2026, with a penetration rate above 50.0%. Embodied intelligence has become one of the most active areas of AI development: more than 400 complete humanoid robot models shipped in the first half, and full-year output is expected to exceed 100,000 units.

CNNIC is a research institution directly under the Ministry of Industry and Information Technology, responsible for managing and servicing China's internet infrastructure resources. The report draws on the latest survey data to analyze how people use generative AI, how industries are applying it, and how policy is being written around it.

User Base Tops 700 Million, With Q&A the Leading Use Case

The report finds that AI use cases in China are widening and that consumer demand for intelligent products is accelerating, with question-and-answer the dominant application: 76.0% of users say they put questions to generative AI. Another 47.8% use it to handle images and video, 37.6% for text, and 32.5% for work summaries, meeting minutes, and slide decks.

Usage of general-purpose AI assistants and AI productivity tools each more than doubled year over year. Some 38.7% of internet users bought smart hardware online in the past six months, including 20.2% who bought smart wearables and 18.2% who bought 3C electronics such as smartphones or tablets.

Intelligent Computing Power Hits 2,185 EFLOPS as First All-Domestic 100,000-Chip Cluster Goes Live

As of June 2026, China's intelligent computing power reached 2,185 EFLOPS, up 177% year over year. The country's first all-domestic 100,000-chip AI supercluster has entered service, built on homegrown hardware and software across the stack, marking a new phase of computing power infrastructure deployment at the 100,000-chip scale.

On the model side, domestic firms including DeepSeek and Moonshot AI have released several open-source large models with trillion-parameter scale. The report says the top six models on global usage rankings for mainstream large models all come from Chinese teams, and domestic models are being tuned to run on domestic AI chips at a faster pace. On the data side, China has built more than 120,000 high-quality datasets, creating a reinforcing loop among computing power, models, and data.

Adoption Spreads to Steel, Power, and Other Core Industries, With Over 30% Penetration Among Larger Manufacturers

AI is now in use across core industries including steel, nonferrous metals, power, and telecommunications, reaching into R&D, quality inspection, and customer service. As of June this year, China had cultivated 16 national-level advanced manufacturing clusters, and more than 30% of manufacturers above designated size had adopted AI, covering essentially the full chain from R&D and design to production, quality inspection, and maintenance.

Agriculture is moving in step. In June 2026, the State Council issued the "15th Five-Year Plan for Accelerating Agricultural and Rural Modernization," naming AI adoption and smart agriculture as key goals. A cluster of agricultural large models has followed, including Shennong 4.0, the Guyu agricultural meteorology model V2.0, and Fanli 4.0.

AI Funding Reaches About 250.14 Billion Yuan in the First Half, 1.82 Times the 2025 Full-Year Total

Funding keeps setting records. In the first half of 2026, China saw 1,255 AI-related investment and financing deals, equal to 78.0% of the 2025 full-year count, worth a combined 250.14 billion yuan, or 182.0% of the 2025 full-year total.

Policy Focus Shifts to Both Real-World Deployment and Governance

The report notes that China's AI industry ecosystem continues to mature, with the policy focus moving from technical breakthroughs toward a dual emphasis on real-world deployment and regulatory governance. The State Council's "Opinions on Deepening the Implementation of the AI Plus Initiative" serves as the overarching framework, with supporting measures from multiple ministries forming a layered policy matrix.

Key technologies are advancing: domestic AI chips and computing power clusters are gaining ground, core algorithm architectures are iterating faster, and the open-source ecosystem is expanding, with Chinese open models such as DeepSeek and Qwen steadily gaining influence. Over the same period, the Agent Trusted Infrastructure (ATI) platform went live, and a Beijing municipal key laboratory for agent identification and security technologies was established.