TLDRs;
- China’s AI apps reached 729 million users, but nearly 60% of AI-native apps lost users in Q3.
- Doubao overtakes DeepSeek as the leading AI-native chatbot with 172 million monthly users.
- Integrated AI features in apps like Baidu and Douyin attract far more users than standalone AI apps.
- Growth in AI user numbers masks challenges in retention, monetization, and paid adoption.
China’s AI mobile ecosystem continues to expand in terms of overall user numbers, but a closer look reveals growing pains for many AI-native applications.
According to QuestMobile, the country’s AI apps reached 729 million monthly active users (MAUs) in September, up from 680 million in June. However, nearly 60% of AI-native apps lost users during the third quarter, signaling intensified competition and challenges in maintaining engagement.
AI-native applications, such as DeepSeek’s chatbot, accounted for 287 million users, while apps with integrated AI features attracted 706 million users, indicating that embedded AI functionalities are winning mass adoption over standalone solutions.
Doubao Leads, DeepSeek Slides
In the AI-native segment, Doubao, a ByteDance-owned chatbot, emerged as the market leader in September with 172 million monthly users, surpassing DeepSeek, which fell slightly to 145 million users, a 1.7% drop since July. Tencent’s Yuanbao ranked third with around 33 million users.
This shift underscores the intense rivalry among domestic AI providers, where even modest changes in user engagement can reshape the competitive landscape.
Experts note that while Doubao’s growth reflects strong brand adoption, sustaining users and converting them into paying customers remains a critical hurdle.
In-App AI Features Outpace Standalone Apps
Integrated AI functions are proving more popular with Chinese users than standalone AI-native apps. Baidu’s AI search feature led in-app adoption with 347 million users, followed by Douyin with 215 million and WeChat at 166 million.
Analysts suggest that this trend reflects convenience: users prefer AI embedded in familiar platforms rather than downloading separate applications.
Moreover, this shift opens opportunities for toolmakers and software developers. Companies can provide plug-and-play AI solutions, including large language models (LLMs) and voice assistants, through SDKs or on-device inference, allowing apps to integrate advanced AI capabilities without starting from scratch.
Monetization Challenges Remain
Despite growth in MAUs, monetization remains a critical concern. QuestMobile’s report does not account for paying user counts, average revenue per user (ARPU), or income from AI-native apps like Doubao, DeepSeek, or Baidu’s AI search.
DeepSeek reportedly spent $5.5 million on training its models, a fraction of the $100 million+ spent on GPT-4, highlighting the resource intensity of AI development.
Education and tutoring apps such as Kuaidu and Zuoyebang demonstrate that AI can drive revenue growth, but most AI-native apps still face the challenge of converting free users into paying customers. Analysts caution that MAU growth alone may be misleading, as retention and monetization metrics ultimately define sustainable business success.
The Road Ahead for China’s AI Market
China’s AI app landscape is rapidly evolving. Developers have created over 100,000 autonomous AI agents by late 2024, and hardware makers plan for 70% AI PC penetration and 54% AI smartphone adoption by 2028.
Integrated AI features, low-code AI agent platforms, and on-device processing are set to shape the next phase of adoption.
Yet, the current user decline in AI-native apps highlights that market size alone does not guarantee success. Companies must balance innovation, retention, and monetization if they hope to thrive in an increasingly crowded and competitive ecosystem.
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