Annual recurring revenue at seven major Chinese AI developers has remained at about one-tenth of that of OpenAI and Anthropic. On Sept. 18, the Hong Kong-based South China Morning Post (SCMP) cited U.S. research firm Rhodium Group as estimating the companies’ annual recurring revenue at a combined $10.7 billion from March to August.

OpenAI and Anthropic, used as comparators, had combined annual recurring revenue of more than $100 billion. Annual recurring revenue is a metric that annualises current monthly subscription income over 12 months. The surveyed companies include DeepSeek, Moonshot AI, Z.ai, MiniMax, Alibaba Group Holding, ByteDance and Kuaishou Technology. Kuaishou Technology operates the video generation service Kling AI.

By company, ByteDance had the highest annual recurring revenue at $4.0 billion as of July, followed by Alibaba Group Holding at $2.4 billion as of August. OpenAI stood at $40.0 billion in August and Anthropic at $65.0 billion in July. DeepSeek and Kling AI had the lowest annual recurring revenue at $500 million each. MiniMax was at $800 million in August and Moonshot AI at $1.0 billion in August. Z.ai executives said on Sept. 17 that annual recurring revenue had reached $1.8 billion, while Rhodium Group put the August figure at $1.6 billion based on its API business.

Chinese AI companies are sustaining investor interest despite the revenue gap. Moonshot AI is raising funds at a valuation reflecting about $50 billion and filed confidentially for a Hong Kong initial public offering. DeepSeek is also nearing the final stage of raising pre-IPO funding at a valuation of about 500 billion yuan, or $74.0 billion.

Some companies, however, were valued more highly relative to revenue. The estimated valuation-to-annual-recurring-revenue multiples were 50 times for Moonshot AI and 163 times for DeepSeek. OpenAI was at 34 times and Anthropic at 21 times.

China’s AI industry faces the task of turning AI models into sustainable businesses while spending heavily on competition in cutting-edge technology. Z.ai’s first-half revenue rose 400 percent from a year earlier to 953.9 million yuan, while MiniMax’s increased 283 percent to $116.6 million. Ellie Jiang, head of Asia internet and software research at Macquarie Group, said Z.ai and MiniMax could remain in the red through 2030 due to the burden of investing in computing resources.

Chinese developers are rapidly narrowing the performance gap with U.S. rivals while stepping up price competition and open-source and open-weights strategies. But open-weights strategies have worked against monetisation. That is because third-party cloud operators can distribute and sell models without paying the original developers. Moonshot AI and Alibaba Group Holding are pursuing revenue-sharing contracts with major users.