China's AI Investment Shifts: From Infrastructure to Applications, Watch These Stocks

• China's AI investment focus is rapidly moving from infrastructure to application-centric strategies, driven by local investor enthusiasm.
• Generative Engine Optimization (GEO) is a key trend, where advertisers aim for brand visibility in AI chatbot results, with the market projected to reach 3 billion yuan in 2024.
• Concerns about an AI chip bubble and Meta's acquisition of Manus are boosting interest in agentic AI, which automates decision-making for better output.
• Alibaba and Tencent are positioned as major beneficiaries, leveraging their existing ecosystems and AI capabilities in e-commerce, gaming, and advertising.
• ByteDance's Doubao app and integration plans are driving the AI application race, with analysts predicting 2026 as a pivotal year for AI-to-consumer investments.

Why It Matters: China's AI market is pivoting to applications like GEO and agentic AI, favoring tech giants like Alibaba and Tencent.