China's robot IPO boom masks circular financing scheme

Unitree's record-breaking IPO valuation sits atop a financing structure that differs sharply from traditional venture-backed robotics companies. The company's dependence on state-backed training centers—which accounted for nearly three-quarters of its humanoid revenue in the first nine months of 2025—creates a closed loop where demand is partly engineered rather than market-driven. At manufacturer Leju, these centers represented 45 percent of sales of its flagship robot, underscoring how central the arrangement has become across the Chinese robotics sector.

The skepticism centers on two linked issues: data quality and valuation credibility. Training data generated in controlled centers may not reflect real-world robot performance; one center manager disclosed that only two to three of every eight training hours are usable, according to Marco Wang of Interact Analysis. Meanwhile, Unitree's valuation at 35.89 times revenue dwarfs Hong Kong rivals at roughly 20 times, prompting analyst Vey-Sern Ling to conclude there is "clearly no fundamental basis for the share price surge." The pattern mirrors criticism leveled at U.S. tech giants—Nvidia, for instance, has backed AI firms and data center projects that in turn create demand for Nvidia's own chips, a structure critics say artificially inflates market size.

Beijing's approach, however, appears deliberate. About 20 percent of Unitree's IPO went to strategic investors including AI startup Deepseek, signaling state endorsement. Chinese officials and supporters argue the model mirrors earlier successes: electric cars and solar panels, which China now dominates after state-driven demand seeded those industries. Early-stage investors in Unitree are already seeking exits, according to the Financial Times, suggesting some doubt whether the current valuation can hold.