Chinese humanoid robot startup gets $100M boost led by Alibaba

A new chapter in humanoid robotics begins

X Square Robot, a young Shenzhen-based startup, just raised about $100 million in fresh funding. The round was led by Alibaba Cloud, showing how seriously China’s most prominent tech players treat embodied AI.

Other backers included HongShan, Meituan, Legend Capital, and INCE Capital. For a company founded in December 2023, that’s an incredible trajectory.

This latest investment brings its total funding close to $280 million, a clear signal that investors believe humanoid robots are more than just hype.

Why Alibaba is leaning into humanoid robots

Alibaba has long invested in artificial intelligence and cloud services, but this $100 million bet marks its most decisive move into embodied robotics.

The company sees humanoids as a natural extension of its ecosystem, where robots could one day integrate with its e-commerce, logistics, and cloud infrastructure.

Think about warehouses staffed by machines that learn, adapt, and work alongside humans in real time. This deal is less about speculation and more about preparing for the next wave of intelligent automation.

The startup is moving at record speed

When X Square Robot was founded less than two years ago, few expected it to rise so quickly. Yet by September 2025, it had already completed eight funding rounds.

Chief Operating Officer Yang Qian revealed the company has already begun generating revenue through sales to schools, hotels, and retirement homes.

That traction matters; it proves this isn’t just a lab project. X Square shows that humanoids can create real business value today, not just years later.

A milestone with open source embodied AI

X Square also introduced something groundbreaking: Wall-OSS, an open-source foundation model designed for embodied AI.

By releasing the code to the public, developers everywhere can experiment with robotic applications, accelerating innovation across the ecosystem. This marks the first time a company has open-sourced a foundation model specifically built for embodied AI in humanoid robotics.

The vision is bold, imagine robotic butlers or helpers becoming a reality within five years, thanks to shared community-driven progress instead of closed-door development.

Robots need more than clever mechanics to succeed

For decades, robotics focused on hardware arms that could grasp or wheels that could navigate. However, Yang Qian argues that robots will always be limited without intelligence.

Generative AI is the missing link, enabling machines to make decisions, adapt to environments, and work more autonomously.

While current robot AI lags behind chatbots like ChatGPT, the gap is narrowing fast. Once embodied AI catches up, humanoids can perform tasks beyond cleaning or carrying objects.

New robots are already rolling out

Alongside the funding, X Square unveiled its Quanta X2 humanoid robot. This dual-arm, wheeled robot can perform practical household and service tasks, including attaching mop heads for 360-degree cleaning.

Its hands are designed with pressure sensors, allowing subtle, human-like dexterity. While the robot isn’t ready for the mass market, it showcases what’s possible when intelligence and functionality converge. Instead of gimmicks, X Square is clearly designing robots that solve everyday problems.

Pricing remains a steep challenge for adoption

Here’s the catch: the Quanta X2 humanoid robot is priced at around $80,000 according to industry research. By comparison, rival Unitree sells humanoid robots for closer to $16,000, though with fewer advanced features.

Yang believes prices need to fall to around $10,000 per unit for consumer adoption. That means significant hardware cost reductions, economies of scale, and better domestic chip production. She predicts this price breakthrough could realistically happen within three to five years.

The race for affordable humanoids is heating up

China isn’t the only country investing in humanoid robots, but its rapid progress is hard to ignore. Rivals like Unitree Robotics, UBTech, and LimX Dynamics are also raising large funding rounds.

With Alibaba backing X Square, the competition just intensified. Affordability will likely determine the winners in this race.

Companies that manage to scale production and slash costs the fastest will be the ones that unlock actual mainstream adoption, just as BYD did in electric vehicles.

The global spotlight is turning to embodied AI

OpenAI’s ChatGPT showed the world what conversational AI could do, but robotics requires embodied intelligence, the ability to sense, move, and interact physically.

X Square’s Wall-OSS model is a step toward standardizing this field. Analysts say embodied AI could one day rival generative AI in importance, particularly as machines integrate into daily life.

By going open source, X Square positions itself not just as a robotics company, but as a potential global leader in AI infrastructure for hardware.

China’s larger ambition is impossible to miss

This investment is part of China’s broader strategy to dominate next-generation technologies. Just as it did with electric vehicles, China is now positioning itself to lead in humanoid robotics.

The mass production of robots began domestically in 2025, supported by policy and capital. With Alibaba and other giants pouring money into startups, China hopes to export its robotics expertise worldwide. If successful, it could fundamentally shift the balance of global tech leadership.

Hospitals and elder care may see robots first

Healthcare is one of the sectors most likely to adopt humanoid robots early. China faces an aging population and workforce shortages in elder care.

X Square already has pilot deployments in retirement homes, where robots can provide companionship, assist with mobility, and support staff.

Hospitals may also benefit from robots doing repetitive tasks like delivering supplies or updating records. The idea isn’t to replace doctors and nurses, but to free them to focus on higher-level care.

Hotels and schools are already testing the future

COO Yang Qian revealed that hotels and schools are among X Square’s early customers. In hotels, humanoid robots can act as service staff delivering items, greeting guests, or handling simple cleaning tasks.

In schools, robots can support teaching, provide tutoring, or assist with special needs education. These environments are ideal testbeds, offering real-world complexity while keeping individual tasks manageable.

Success here could pave the way for broader consumer adoption in households and workplaces within the next decade.

The IPO buzz is already starting

X Square isn’t just thinking about raising funds from venture capital. Yang Qian confirmed that the company plans to begin preparing for an initial public offering next year.

While the listing location hasn’t been finalized, it shows how ambitious the startup is. An IPO would give X Square the financial firepower to scale manufacturing, expand internationally, and advance embodied AI research. Investors are betting this could be one of China’s next breakout tech stories.

Alibaba gains more than just investment returns

For Alibaba, the benefits of this deal extend beyond financial upside. Humanoid robots could eventually integrate into their vast logistics and retail networks.

Imagine Cainiao delivery hubs staffed with humanoid assistants, or shopping experiences in Alibaba-owned malls enhanced by robots that can guide, assist, and interact with customers.

“This synergy means Alibaba isn’t just investing, it’s also positioning itself as one of the technology’s biggest end users. That’s a competitive advantage few rivals can match.

The role of chips cannot be underestimated

X Square currently relies on Nvidia chips for AI training, but COO Yang notes that many robot functions only require less powerful automotive-grade chips, which can be sourced domestically.

This is critical because U.S. export controls are tightening on high-end AI hardware. By using locally available chips for day-to-day functions, X Square could reduce supply chain risk while relying on Nvidia for cutting-edge research. Balancing performance and availability will be key.

Discover how China’s AI robots are evolving faster than ever and shaping the next wave of innovation.

China is building its own AI foundations

The robotics push ties into China’s larger AI race. While the U.S. surged ahead with OpenAI’s ChatGPT in 2022, China is catching up fast.

Companies like DeepSeek are releasing open models, and now X Square has gone further with robotics-focused embodied AI.

By opening Wall-OSS to the world, China sends a clear message: it wants to shape global standards for AI in hardware. If widely adopted, this could give China a critical edge.

Meanwhile, Apple’s next move could be a talking home robot with advanced Siri.

What do you think about a Chinese tech company building humanoid robots to make everyday work more convenient? Please share your thoughts and drop a comment.

Read More From This Brand:

• Elon Musk sees $30 trillion potential in Tesla’s robot future
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• Hugging Face unveils robotics model running smoothly on MacBook

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This slideshow was made with AI assistance and human editing.