What is the market size of AI toys? Public data shows that the total retail sales of toys in the domestic market will reach 97.85 billion yuan in 2024, an increase of over a quarter compared to 2020. It is estimated that the retail sales of toys in China will exceed 100 billion yuan by 2025. The export market is also impressive, with toy exports reaching 39.87 billion USD during the same period, a nearly 20% increase. Among these, the market size of AI toys in China is expected to be around 24.6 billion yuan in 2024, and it is projected to rise to 29 billion yuan in 2025.
With the wave of domestic large models led by Deepseek sweeping the globe, a new generation of artificial intelligence, smart hardware, and wearable devices are changing people’s consumption patterns and lifestyles. Compared to traditional toys, smart toys achieve natural and diverse interactive feedback between people and toys through technologies such as voice recognition, voice cloning synthesis, facial recognition, emotion analysis, gesture recognition, tactile perception and feedback, and natural language processing.
Empowered by AI technology, the toy industry in China and globally is undergoing a profound value reconstruction. AI toys integrate technologies such as language large models and visual large models, achieving capabilities of “listening, seeing, and interacting.” AI toys have evolved from a single entertainment attribute to a “smart partner” with multiple functions including educational enlightenment, emotional companionship, and creativity stimulation. The user base for AI toys has expanded to include “young and old,” and Chinese companies have significant advantages in manufacturing costs, supply chain completeness, and iteration speed. Coupled with the layout of domestic companies in original IP and licensing resources, this is expected to give rise to globally influential blockbuster products. Notably, integrating excellent traditional culture into toy design has become an important development direction. Through the deep integration of technology and culture, children can experience the dual charm of AI and culture in an immersive experience. Nowadays, more and more intelligent toys that combine a sense of technology with cultural flavor have emerged in the market.
Recently, the Ministry of Industry and Information Technology held a press conference on toy safety, where it officially defined “AI toys” as a new growth engine driving industrial upgrades, marking the formal entry of smart toys into the focus of national industrial policy. Currently, the AI toy sector is characterized by a mixed competition among various participants. While the industry is thriving, the improvement of regulations and safety guarantees urgently needs to be strengthened. The new national standards respond positively to this, significantly raising safety requirements. In response to consumer concerns about data security and network security of AI toys, the Ministry of Industry and Information Technology will collaborate with relevant departments to strengthen assessments, guide toy companies to enhance technical protection, and timely research and formulate relevant standards to effectively ensure the quality safety of AI toys and the privacy security of user data.
Some large enterprises have also begun to enter the market. Platforms like JD.com are actively laying out, providing technical support, lowering the access threshold for AI technology, and promoting the collaborative development of the industrial ecosystem. Governments in places like Beijing Yizhuang and Shenzhen Nanshan are also closely monitoring the development of the AI hardware market. We believe that with the joint effects of policy guidance, corporate innovation, and market drive, in the next two years, the market will see an increasing variety of AI toy products that meet the new standards, and toy companies will welcome a critical window for production line upgrades and product iterations.
China’s AI toy industry is transitioning from scale expansion to quality improvement. With a complete industrial chain foundation and continuous innovation capabilities, it is expected to gain a more significant voice in the global smart consumption arena.
The era of AI toys has arrived, and enormous market opportunities are about to be released, encouraging optimists to continue moving forward!