IPO

Chinese AI firms dominate Hong Kong IPOs with $22 billion in exits, while US tech listings lag amid investor skepticism.

China’s artificial intelligence companies are driving a sharp divergence in global IPO markets, dominating first-quarter listings in Hong Kong and outpacing U.S. tech peers as investor sentiment fractures across regions.

Consider the trend: Chinese AI firms listed in Hong Kong accounted for four of the largest public listings in the first quarter. According to new data from PitchBook, these companies — Z.ai, MiniMax, Biren Technology and Iluvatar CoreX Semiconductor — collectively helped drive more than $22 billion in AI-related exit value during the quarter.

Adding Edge Medical, a surgical robotics company, brings the total for all five Chinese listings to over $24 billion.

The performance stands in sharp contrast to the muted reception many U.S. technology IPOs have faced. Investors have grown increasingly skeptical of richly valued software companies amid concerns that AI could disrupt traditional software business models.

“It’s genuinely a confluence of factors rather than any single driver,” Harrison Rolfes, senior research analyst at PitchBook, told Global Finance. “The DeepSeek moment in early 2025 fundamentally shifted investor perception of Chinese AI capability, and that rerating carried momentum into these listings.”

Rolfes said geopolitical considerations also played a major role, creating what he described as a “national champion premium” among investors in Hong Kong and broader Asian markets.

“Structurally, these companies came to market at more digestible valuations relative to their growth profiles compared to U.S. tech IPOs, which have repeatedly disappointed at high entry multiples,” he said.

Investor enthusiasm surrounding Chinese AI firms has emerged as U.S. IPO performance deteriorates.

A Record Stretch of IPO Underperformance

According to PitchBook data, the median U.S. IPO has underperformed its benchmark by 42 percentage points within 120 days of listing over the trailing 12 months.

“That’s historically the worst stretch in our dataset,” Rolfes said.

PitchBook noted that 2025 already represented a record low, with median IPOs trailing benchmarks by 35.6 percentage points after 120 days. Early 2026 listings are performing even worse, according to the report.

The closest comparison, Rolfes said, was the post-boom correction in 2021, when median U.S. IPOs lagged their benchmarks by 32 percentage points following aggressive pricing during the .

Globally, the median venture capital-backed IPO has underperformed the Morningstar U.S. Market Broad Growth Extended Index—a broad U.S. equity benchmark—by nearly seven percentage points over the past year. In the U.S., the index as a growth-stock yardstick shows that the gap widens sharply to 42 percentage points within 120 days of listing.

Roughly 66% of companies that have gone public since the start of 2025 are currently trading below their IPO prices, PitchBook found.

“The deterioration is progressive, suggesting that initial pricing optimism is giving way to fundamental reassessment as lockup expirations approach and more information reaches the market,” according to the May 5 report.

The divergence in performance has been particularly stark among high-profile tech listings.

SaaSpocalypse to Blame?

CoreWeave, based in Livingston, New Jersey, saw its shares nearly triple since its debut as investor demand for AI computing infrastructure accelerated. But many other venture-backed listings have struggled—badly.

Among the U.S.-listed laggards are shares of eToro, down 45.2%; Netskope, down 61%; Klarna, down 67.1%; Figma, down 85.7%; and Gemini Space Station, down 86.3%.

PitchBook said broader public SaaS markets have also weakened as investors increasingly treat AI as a threat to incumbent software firms rather than a growth catalyst.

“Public markets appear to be treating AI not as a tailwind for existing software but as a displacement risk, which many are calling a ‘SaaSpocalypse,’ in which incumbents are repriced downward even as private AI unicorns command record valuations,” according to the report.

For investors, the divergence raises questions about whether U.S.-listed AI companies still offer the best risk-adjusted exposure to the global AI boom.

“The companies leading Hong Kong’s surge — semiconductor designers, applied AI platforms and robotics-adjacent businesses — are generating real revenue with defensible vertical positioning, and they have outperformed their U.S. counterparts by a wide margin,” Rolfes said.

What’s Next?

Expect investors to take a closer look at how heavily their portfolios are tilted toward specific geographies, considering AI-related valuation premiums are persisting longer in Hong Kong than in New York.

Rolfes also cautioned that some of the highest-valued Chinese AI names could eventually face corrections. Still, the underlying businesses are stronger than many Western investors have assumed, he argued.

“The broader takeaway,” he said, “is that Chinese AI has likely graduated from a risk to monitor to a market to understand.”