China's push for AI supremacy is benefiting companies with global revenue exposure, with a Bloomberg gauge of 30 export-oriented tech stocks returning 36% this year versus 9% for domestically focused peers. This divergence stems from Beijing's self-sufficiency campaign sparking intense local competition and price wars that erode margins on chips and robotics. Meanwhile, exporters thrive on surging global demand for AI infrastructure like data centers.

Optical component makers Zhongji Innolight Co. and Eoptolink Technology Inc., deriving over 90% of revenue overseas, have each rallied about 50%. Gains are fueled by strong global AI spending outlooks, with Nvidia Corp. CEO Jensen Huang expecting to sell twice as many chips next year and Meta Platforms Inc.'s new AI agent signaling robust demand. Bank of America strategists note emerging-market funds favor exporters leveraged to the US AI capital expenditure cycle.

Domestically focused firms suffer: Moore Threads Technology Co. is down 25%, Sense Time Group Inc. has fallen over 40%, and Kuaishou Technology has slumped 51%. Cut-throat competition has led to cheaply priced AI models and apps at the expense of profitability. While Morgan Stanley sees AI sovereignty and semiconductor localization as structural opportunities regardless of geopolitical outcomes, others warn the race-to-the-bottom competition, known as involution, will continue plaguing local AI firms.