Chinese artificial intelligence companies Z.ai and MiniMax could remain loss-making through 2030 even as their revenues surge, underscoring the enormous cost of competing at the technological frontier, according to Macquarie Group’s head of Asia internet and software research Ellie Jiang.
One reason cited was the expense required for the computing power to train and run frontier AI models. Jiang told the South China Morning Post on Tuesday that China’s compute crunch was two to three times more acute than the wider global shortage, as domestic developers struggled with US restrictions on Nvidia’s most advanced processors.
Speaking on the sidelines of the Macquarie Asia Technology Conference 2026, Jiang said that the investment bank was “still modelling loss-making into 2030” for Z.ai, also known as Zhipu AI, and MiniMax.
“We are trying to be a bit more conservative in our estimate,” she added.
Macquarie’s relatively conservative outlook comes despite expectations for rapid growth in annual recurring revenue (ARR) – a key metric that projects current monthly subscription income over a 12-month period – as Chinese AI developers attract more paying users and businesses increase their use of generative AI.
“The flip side of that story is, we also assumed a much higher ARR growth,” said Jiang. The Macquarie analyst said Z.ai had planned for ARR of around US$2.4 billion by the end of the year, while Macquarie’s estimate was closer to US$3 billion.