The size of China's artificial intelligence (AI) industry was estimated to exceed 1.2 trillion yuan (about 176.7 billion U.S. dollars) in 2025, up 40 percent year on year, according to the China Academy of Information and Communications Technology (CAICT), a research institute under the Ministry of Industry and Information Technology. CAICT noted that China was home to more than 6,600 AI companies as of June 2026, representing 15 percent of the global total. The country has developed a complete industrial system spanning foundational infrastructure, models and frameworks, and sector-specific applications. The application segment accounted for 55 percent of the entire AI industry chain in 2025, up 22 percent year on year. The foundational segment accounted for 38 percent and grew 59 percent, while the segment covering models and frameworks made up 7 percent and grew 189 percent. The industry is highly concentrated in a few regions, with Beijing, Guangdong, Shanghai, Zhejiang and Shandong accounting for more than 80 percent of the national total. Large AI models, AI agents and AI chips are evolving rapidly, while AI products are diversifying and their use is expanding across traditional industries. CAICT has led the drafting of two industry standards on defining the AI sector and identifying AI companies. China will continue to advance its "AI Plus" initiative to promote the integration of AI into various sectors.