Chinese tech watchers and venture capitalists are growing increasingly concerned over the long-term market appeal of Chinese tech companies. Industry leaders are sharing and quoting a Chinese financial infographic comparing the changing market capitalization of Apple and top Chinese firms over the past two years to show just how much the value of China’s tech giants has dropped. 

Why it matters: After two decades of enormous growth, the top five Chinese tech giants have lost at least 46% of their combined market cap over the past two years in the face of headwinds from saturating markets, pandemic outbreaks, trade tensions, and rigorous government regulations.

(Image credit: TechNode/Ward Zhou)

Details: Chinese tech companies are less valuable than they were two years ago. On April 26, Chinese financial media outlet Jin10 Data published an infographic (in Chinese) showing the drastic shrinkage in the valuation of China’s top tech firms. The infographic compared the market cap of US smartphone maker Apple with Chinese tech firms, showing that Apple’s $2.7 trillion valuation was worth more than double the value of China’s top 49 tech firms combined.

  • The graphic highlights the stark market cap difference by comparing Apple and Chinese tech firms’ April market cap data with those from two years ago. On April 27, 2020, Apple, valued at $1.2 trillion at the time, roughly equaled the combined valuation of the top five Chinese tech firms — Alibaba (which had a market cap of $548.2 billion), Tencent ($508.7 billion), Meituan ($74.9 billion), JD.com ($66.2 billion), and Pinduoduo ($59.4 billion). Two years later, Apple’s valuation has more than doubled while many Chinese tech firms’ valuation has decreased or stagnated, making the former now worth more than 49 top Chinese tech firms combined. 
  • Chinese financial writer Wu Xiaobo cited the infographic in a post titled “What’s wrong with us?” lamenting the loss of the “upbeat spirit” of China’s business world.
  • China’s tech clampdown has wiped hundreds of billions off the valuation of Alibaba and Tencent, China’s two largest tech companies, amid the US-China trade war and the country’s antitrust clampdown since April 2020.
  • On Monday, the market cap of Tencent, currently the most valuable Chinese tech firm, slumped to $427.6 billion, while Alibaba’s market cap has more than halved to $247.5 billion. Pinduoduo also lost more than $10 billion in valuation.
A Chinese financial infographic showing the shrinking market value of Chinese tech companies sparked concerns among Chinese tech watchers. (Image credit: TechNode/Ward Zhou) Credit: Jin10.com

Context: The change in value of China’s biggest tech firms only reflects listed companies. Some of the country’s biggest tech players that remain private are not included in the comparison, such as ByteDance, Huawei, and Alibaba’s Ant Group.

  • China is recording slow growth in the number of unicorns, or startups valued at more than $1 billion and not yet listed on a stock exchange, according to the Global Unicorn Index 2021 released by Hurun Research Institute in December. In 2021, China counted 301 unicorns, or 28% of the 1,058 unicorns worldwide, down from 41% in 2019.

Emma Lee

Emma Lee (Li Xin) was TechNode's e-commerce and new retail reporter until June 2022, when she moved to Sixth Tone to cover technology and consumption. Get in touch with her via lixin@sixthtone.com or Twitter.