Epoch AI: China’s six leading AI firms earn about 10% of OpenAI and Anthropic’s combined AI revenue; China is 2.7× more exposed to a chip supply shock
Partly confirmed
Status
- Claim
Partly confirmed
- Our reporting
- Medium confidence
- Importance
- 3 of 5
- Last verified
- 13 October 2026
Your AI and this story
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None of these four assistants can know about it. The closest, Claude Opus 5.5, stops 98 days before it.
Key facts
- Annualized AI revenue in Epoch’s chart (US$B): Anthropic 65 (July), OpenAI 40 (August), ByteDance 4.0 (July, MaaS only), Alibaba 2.4 (August, MaaS only), Z.ai 1.8 (September), Moonshot 1.0 (August), DeepSeek 1.0 (September), MiniMax 0.8 (August); months and definitions differ, so the figures are not strictly comparable
- DeepSeek: mainly API sales (est. $1B), estimated API gross margin 70–80%; about 8% of OpenRouter spending on its models goes to DeepSeek itself
- Z.ai (Zhipu): estimated 2026 API revenue $805M; on-premises share of revenue fell from 73.7% (2025) to 13.5% (H1 2026); API gross margin 18.9% (2025) → 24.6% (H1 2026); management’s September ARR of $1.8B differs from interim-report figures
- MiniMax: AI-native app gross margin 4.7% (first nine months of 2025) vs 69.4% for enterprise services; Moonshot: about 70% of revenue from model access as of June 2026
- ByteDance: Volcano Engine handled 49.5% of China’s public-cloud large-model token calls in 2025; 2025 MaaS revenue about $221M vs an estimated ~$4B ARR in 2026. Alibaba: AI cloud and compute revenue $7.1B in Q2 2026 (+45% YoY)
- Epoch: ‘consumer-facing AI apps are not highly profitable’; Liang Wenfeng is quoted saying DeepSeek ‘doesn’t have that much compute’
- Chip-shock report (Daniel Carey): in 2022 every $1,000 of Chinese final demand generated $15.2 of semiconductor revenue vs $5.7 for the US (2.7×); China’s domestic producers met 23% of its demand in 2022 (12% in 2016)
- Modelled Taiwan collapse plus China–West decoupling (2–3 year horizon): China’s advanced-processor prices rise 17-fold and real expenditure falls 3%; US prices rise about 20% and expenditure falls 0.6%; price effects are much less robust than the expenditure effects (range: +6% to 100-fold)
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- Caveats: revenue from disclosures, press and run-rate statements; trade tables end in 2022 and miss the US AI-server boom (a 2024 check gives 2.2×)
What happened
Epoch AI collected company disclosures and press figures for the six Chinese firms that lead in models. Together they run at roughly a tenth of the two US leaders’ revenue. Start-ups (DeepSeek, Moonshot, Z.ai) live mostly on API sales with thin to good margins; ByteDance and Alibaba earn mostly indirectly, through cloud, ads and commerce. Consumer apps earn little.
The companion trade-model report measures who depends more on imported chips. China does, by a factor of about 2.7 in 2022, and in every scenario tested its losses from a disruption exceed those of the US.
Why it matters
Chinese open-weight models are close to the frontier on many benchmarks while their makers earn an order of magnitude less, which limits what they can spend on compute. The trade result gives a number to China’s chip dependence at a time of export controls and Taiwan risk. Both reports rest on estimates, as Epoch states.
Sources
2 sources from 1 site. Numbers match the chips in the text.
2 sources: 2 primary
Primary
- Epoch AI: How do Chinese AI companies make money? (Oct 6, 2026)epoch.ai, official
- Epoch AI: Who is most exposed to a chip supply shock? (Oct 6, 2026)epoch.ai, official
Changes
- Filed (both reports read directly)