ChatGPT moment for humanoid robots: who will become the trillion-dollar market leader

In September, several Chinese companies unveiled new models of their robots, which do have practical applications - both in manufacturing and for home use. The year 2025 is being called a watershed year for the industry: this is when the production of humanoid robots could become mainstream. As of September 30, the ROBO Global Robotics and Automation Index has gained 16.5% since the beginning of the year, overtaking the S&P 500, which has added 13.7%. Oninvest columnist Yedige Kasymzhan found three non-trivial solutions in robotics that investors should pay attention to.

At the end of September 2025, a vocational school for humanoid robots opened in the suburbs of Beijing - Kuavo's 1.66-meter-tall creatures, using virtual reality and motion capture systems, are practically learning to sort and pack materials and perform other actions to work in warehouses and beyond. It's an evolutionary leap - robots are no longer just fun things that can do tricks, they're starting to be used in real-world production, Renmin Zhibao Online reported. Robots, like real students, are being sent to practice in production: car factories, warehouses, nursing homes and even theater schools, to make up for the lack of data and teach them how to act in a real environment. The goal is to prepare them for everyday, unpredictable tasks. "A robot only becomes smart through constant practice, like a child learning to walk," says project leader Wang Qiang. An unnamed Chinese think-tank cited by the publication predicts that by 2045, Chinese industry will employ more than 100 million humanoid robots and that this market will reach 10 trillion yuan ($1.4 trillion).

Morgan Stanley analysts predict that by 2050 the market volume may exceed $5 trillion and surpass the automotive industry. According to their data, about 1 billion humanoid robots will be in operation. 2025 is called a breakthrough year by many. There is a consensus in our industry that this is the ChatGPT moment for humanoid robots," said Xiong Yujun, CEO of the Beijing Innovation Center for Humanoid Robotics. In the first half of 2025 alone, 83 public contracts worth about 3.3 billion yuan (about $460 million) were awarded in China.A key factor in the competitiveness of companies is the ability to not just sign contracts, but also to ensure stable delivery and operation of robots at real facilities. The market is moving toward consolidation, where capital and orders are concentrated in companies with the greatest technological and operational advantage.

According to JP Morgan, in addition to the well-known Tesla and Boston Dynamics, UBTech Robotics, Sanhua Intelligent and Leader Driver are potential beneficiaries of robot proliferation.

UBTech Robotics is one of the largest Chinese companies in the robotics sector. It specializes in humanoid and service robots. UBTech's product range includes delivery robots, cleaning and janitorial robots, and even guide robots that can work with tourists as well as at exhibitions. UBTech's key technological advantage is industrial functions - in addition to autonomous battery swapping - AI cooperation with humans, as well as collective coordination (Swarm Intelligence), meaning multiple robots can work together on a conveyor belt, sharing data, coordinating tasks and sharing responsibility for execution. UBTech uses the BrainNet framework, which enables communication between the "super-brain" and "local brains" of robots, distributing solutions and task scenarios. One of the latest developments is the Walker S2 humanoid, which is able to autonomously change its own battery, which means it can work around the clock. It is already capable of doing 40-50% of a human's work, and next year it will be able to replace it by 80%....

According to Gasgoo, it was for the supply of this type of robot that UBTech awarded the world's largest single contract (in the humanoid robot segment) on September 3, worth ¥250 million (about $35 million). This is the second significant order over the summer and, combined with the July deal, brings the total Walker series contracts for 2025 to 400 million yuan - JP Morgan's forecast for the full year was 380 million yuan, meaning UBTech has completely exceeded both analysts' estimates and its own delivery plan. The company's key partners include BYD, Dongfeng Liuzhou Motor, Zeekr, Seres, Foxconn and BAIC. On September 3, JP Morgan maintained an "above market" recommendation and raised its target price on UBTech Robotics shares by 17.8% to HK$159 from HK$135. The company is currently loss-making, with a P/E of -49.4.

Sanhua Intelligence is a major supplier of robot components and is entering a new niche of producing actuators that are needed for robot joints and movements. The main growth driver is Sanhua's ability to scale the production of components for humanoid robots. As early as 2025, the company has deployed a specialized unit in Thailand, where it is launching production of actuators, the mechanisms that drive robots. Customers include Tesla. Technical leadership in motors and actuators allows Sanhua to claim tier-one supplier status. According to JP Morgan's calculations, if robotics revenue reaches at least 500 million yuan (about $70 million) by 2027, it will be a critical confirmation of the long-term thesis.

At the same time, the company remains a leader in traditional areas as well, with refrigeration and automotive components showing above-market dynamics. The data center refrigeration segment has already generated about 1 billion yuan in 2024 and is seen as a new market with high potential due to rising energy consumption and the spread of AI. JP Morgan raised its target price on Zhejiang Sanhua Intelligent Controls shares by nearly 78% to 44 yuan from 24.75 yuan, with an "above market" recommendation, in a Sept. 11 report. The company's P/E was 45.1 as of Oct. 1. The analysts' main message is that the company is on the cusp of multi-year above-average growth for the entire sector, and the key factor is entering the humanoid robotics market.

Leader Harmonious Drive manufactures harmonic gearboxes for joints and hand modules, as well as actuators and screw gears applicable in next-generation robots. Technological innovations for manufacturing high-precision components have enabled the company to break the monopoly of international players in the domestic market and position itself as one of the key suppliers of components for robots. The company has moved from research and development to small-scale production for the first time. This is a key step towards commercialization.

An August 18 JP Morgan report noted that growth in the humanoid robot segment has so far been accompanied by high costs and low margins, as the early stages require significant investment in marketing and management. However, the company is actively optimizing production and costs to minimize pressure on overall profitability. Although gross margin declined by about 3 percentage points in the quarter, net margin grew by 3.4 percentage points due to better operating efficiencies. So far, growth has been driven by old trends: rising orders from electronics manufacturers and capacity expansion in the electric vehicle segment. The company's net income in the second quarter of 2025 rose 101% year-on-year, while revenue increased 70%. So on Sept. 3, JP Morgan raised its target price on Leader Harmonious Drive shares by 16%, from 175 yuan to 203 yuan, and maintained an "above market" recommendation. As of October 1, the company's P/E was 428. At the same time, operating cash flow improved, totaling about 30 million yuan, which is comparable to quarterly earnings.Analysts pay special attention to progress toward humanoid robotics.

According to Morgan Stanley, there are 80 robotics and AI companies in China alone, creating high competition and increasing pressure on margins and technology barriers. In addition, the reporting of many startups remains opaque - it is difficult to verify actual commercialization rates, product quality, supply chains and production costs. Political pressures and government regulation are intensifying: export restrictions, localization requirements, the impact of subsidies and industrial policies can both help and create unexpected risks and dependencies.

Experts compare the current wave of interest in AI robots to the second boom of Chinese electric cars, when the number of companies grew under the influence of government incentives and investments, but only a small fraction survived. Analogies to early AI startups are also often pointed out, with many companies getting lots of funding but only a few experiencing sustained growth, showing profits or going into mass production.
In the coming decades, 90% of demand will be driven by corporate orders: we won't have robots working in our kitchens en masse just yet - robots are still quite expensive. Although, for example, the G1 robot from Unitree Robotics costs quite affordable $13,600 - although it can only fight

This article was AI-translated and verified by a human editor