The Integration of Education and AI Will Be One of the Key Directions for Future Industry Development
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In every industry transformation, technology plays a crucial role as a driving factor, and artificial intelligence is no exception. In recent years, AI technology has empowered rapid, sustained, and stable development across various sectors, with the education industry emerging as one of the fields profoundly impacted.
Recently, the education sector has seen a surge, with Onlly Education hitting the limit-up, Xueda Education rising by 7%, and companies like Chuanzhi Education, Kede Education, and QuanTong Education also posting significant gains.
On the news front, the Shenzhen Institute of Advanced Technology of the Chinese Academy of Sciences and Shenzhen United Information Technology Co., Ltd. have collaborated to deepen the integration of "AI + Education," signing an agreement to establish a "Educational Artificial Intelligence" joint laboratory. A series of AI education products have already been launched.
According to a CITIC Securities research report, the integration of education and AI will be one of the key directions for future industry development. Domestic players with advantages in technology, content, and data are expected to lead the way. Among them, leading education and training companies hold significant advantages in areas such as teaching content, student data, and understanding of teaching scenarios.
AI can be applied not only to student learning, exams, family education, and parental companionship but also plays a significant role in teacher instruction and educational management. Education is one of the most direct and logically coherent application scenarios for AI, particularly with the rapid development of generative AI (AIGC).
China's education market is segmented by student age groups and industry models, including early childhood education, K12 education, academic education, vocational education, study-abroad education, and online education. The younger demographic structure and increasing national investment in education have maintained high growth rates in the education market.
In the development of China's education industry, the government has introduced a series of policies aimed at building a lifelong learning society, advancing education system reforms, and strengthening intellectual property protection. Meanwhile, rising demand for education and diversified supply-side development have further propelled the industry's growth. Data shows that in 2022, China's education industry supply scale reached 4.1 trillion yuan, a year-on-year increase of 10.8%.
In 2022, the total national education expenditure exceeded 6 trillion yuan for the first time, reaching 6,132.914 billion yuan, a 5.97% increase from the previous year. Government-funded education expenditure amounted to 4,847.291 billion yuan, up 5.75% year-on-year, accounting for 4.01% of GDP, meeting the "generally no less than 4%" target. General public budget education expenditure was 3,925.696 billion yuan, a 4.79% increase from the previous year, representing 15.07% of the general public budget expenditure.
Recently, the Ministry of Education, Ministry of Finance, and National Bureau of Statistics convened a national conference to advance fiscal education investment and education expenditure statistics. The meeting emphasized that maintaining national fiscal education expenditure at no less than 4% of GDP, ensuring year-on-year increases in general public budget education expenditures, and guaranteeing per-student education funding growth are strategic priorities set by the Party Central Committee and State Council for prioritizing educational development. Local governments must consistently prioritize education, intensify efforts to fulfill funding responsibilities, and ensure proper budget execution while enhancing management for efficient use of education funds.
In-Depth Analysis of the Education Industry
In the intelligent era, emerging technologies like artificial intelligence (AI), big data, and virtual reality are mutually empowering the education service industry. "AI+Education" has recently gained significant investor attention. This concept refers to the integration of AI's innovative applications in education—encompassing technologies, models, and practices—to enhance efficiency, quality, and personalization of educational services. Technology-enabled educational products and services not only help companies build competitive barriers but also create greater value-added opportunities for capital. The synergy between tech-driven quality products/services and policy-supported educational domains will unlock more growth potential and diverse collaboration opportunities for businesses.
Within the education industry, AI+Education represents a major development trend, with leading institutions and tech giants investing in educational large models and AI-powered hardware. The inherent advantages of AI Agents—such as perception, planning, memory, and data processing—make them naturally suited for educational applications. Many practitioners are already exploring AI Agent integration in education, developing products like Aida and jogoda.ai to serve teaching and learning needs.
As the AI wave accelerates, AI education has become a pivotal topic in the field. Recent domestic and international news highlights deepening AI-education integration, with listed companies actively expanding their presence, signaling vast application prospects.
Despite market theories about capital entering a dormant phase, continuous technological advancements and business model transformations keep profitability in focus. The education sector, with its unique long-term and continuous advantages, offers stable and sustained profits. Even as overall capital market investments slow, education industry investments continue to expand.
In education project investments, approximately 11.6% of market investments opt for strategic investments and mergers/acquisitions as primary objectives. Rather than seeking quick returns, capital is increasingly focusing on strategic, long-term education industry chain investments, making this approach a key method for entering the education market.
The education industry, especially the educational technology market, is at a critical turning point in the new era of development. Emerging technologies such as digitization and artificial intelligence, along with various policies, are rapidly propelling the sector forward. Under the backdrop of industrial-scale production, talent cultivation and educational models are transitioning towards comprehensive, personalized talent development and future-oriented education.