Standing at 2026: Key Choices Ahead of the AI Toy Wave

Introduction

In 2026, the global toy industry is being reshaped by an unprecedented force—artificial intelligence is moving from the cloud to children, from screens to every touchable and interactive toy. At international exhibitions like CES, AI robots, educational robots, and smart toys that can learn are in the spotlight, while the demand from parents in Europe and America for "safe, compliant, and truly valuable smart toys" is rapidly increasing.

For European and American brands and distributors, this is both a huge growth opportunity and a comprehensive test of technology, supply chain and regulation: whoever can find a manufacturing partner who understands children's education, electronic intelligence and can strike a balance between AI safety and cost will have the opportunity to occupy the high ground in the smart toy and AI toy market in the next 3-5 years.

From Chenghai to Shenzhen: Who are we?

Our team started from the toy market in Chenghai, China, which can be said to be one of the "laboratories of global toys" - from the earliest plastic toys to electronic remote controls, and then to today's smart interactive products, almost every iteration of toy forms has taken place here. Our in-depth understanding of the toy industry in Chenghai has enabled us to almost instinctively know which toys will truly attract children, survive on the shelves, and become bestsellers.

As the electronic and intelligent levels of toys continue to rise, we have relocated our R&D department to Shenzhen. With our deep insights into the children's toy industry and rich manufacturing experience, our current focus is very clear:

• Focusing on the education and smart products market for children aged 3-12.
• The product line includes children's smartwatches, children's cameras, children's educational toys , and game consoles.
• Our clients mainly consist of overseas brands and channels from Europe, America, the Middle East, etc. We have been providing them with OEM/ODM solutions for a long time.

Why were we able to move from electronic educational toys to AI toys?

1. 20 years of experience in developing intelligent educational products for children aged 3-12: We understand children better than algorithms

Over the past 20 years, we have always focused on products for the 3-12 age group: children's smart watches, functional children's cameras, game consoles, learning computers, and other educational toys... Each product line is closely related to "education, growth, and entertainment".

Through long-term collaborations with educational content providers and overseas clients, we have established a relatively mature product definition logic:

• Children of different ages have different tolerances for screen time, interaction methods, and content depth.
• Parents and schools have different priorities regarding the balance between "educational value, entertainment value, and safety".
• Different markets (such as Germany vs. the United States vs. the Middle East) have significant differences in religion, culture, and family values, requiring different content strategies and parental control methods.

Therefore, when AI technology is ready to enter children's toys, we don't ask "What can AI do?" but rather "What do children need? What do parents want? What can brands and channels sell?" The role of AI in our products is to serve these questions, not to be led by technology itself.

2. With an experienced R&D team

The essence of AI toys is still hardware — it requires reliable structural design, safe circuit layout, stable radio frequency and power management, and the ability to withstand drops and sweat when held by children for a long time. These are not capabilities that any new startup team or content team can acquire in a short period of time. Instead, they are precisely the skills we have been continuously refining over the past 20 years.

3. Forward-looking understanding of AI risks and compliance

Over the past two years, some AI-powered toys have drawn widespread public attention and media coverage due to inappropriate content and the collection of excessive private data. In the United States, some legislators have proposed strict restrictions on AI chatbot toys for children under 18 in the coming years, and even considered a phased ban to allow time for the formulation of regulations.

We recognized from the beginning that "open chatbots" are a double-edged sword for children.

On the one hand, it makes the toys seem very "intelligent," with seemingly endless dialogue;

On the other hand, any AI system with inadequate filtering or insufficient content review could potentially output dangerous, terrifying, or inappropriate content at some point.

Therefore, our understanding of AI toys is:

• AI should be more utilized for "intelligent enhancement" and "personalization" - such as adaptive generation of learning content, personalized practice questions, scene recognition and feedback, extension of story content, etc., rather than allowing it to become an unrestricted chat partner.
• The dialogue system should have clear boundaries: limited to safe areas such as educational topics, common life knowledge, and emotional comfort.

The understanding of AI risks has enabled us to place "safety, compliance, and parental trust" on an equal footing with "fun and technological appeal" when designing the next generation of AI toys, rather than addressing them as a remedial measure afterwards.

2026: What did we see at the forefront of the AI hardware explosion?

We believe that the period from 2026 to 2028 will be a crucial stage for AI hardware (including AI toys) to officially enter a period of large-scale growth from the experimental phase. We call this the "prelude to an explosion" because many signals are already very clear now, and this can be clearly anticipated from the just-ended 2026 CES exhibition.

1. AI is moving from the cloud to "device + edge," and toys will benefit.

More and more consumer electronics products are starting to run AI models on local devices — that is, "edge AI" or "device-side AI." The benefits of this are very direct:

• Faster response, more natural interaction
• Reduced reliance on cloud networks, still available without internet connection
• No need to upload large amounts of voice and image data to the cloud, conducive to privacy protection, especially in children's scenarios.

ABI Research predicts that by 2030, there will be approximately 2.5 billion edge AI devices. Toys and children's wearable devices are expected to become one of the very important sub-categories among them. For parents in Europe and America, the label of "local processing, no uploading of children's private data" is likely to become a key consideration for them when choosing AI toys in the coming years.

2. The AI function will shift from being a "showpiece" to a "necessary requirement", but "security and transparency" are the admission tickets.

At international exhibitions such as CES, AI robots and AI toys have occupied a large number of exposure positions. Many exhibits emphasize positioning such as "emotional companionship", "learning partners", and "family assistants". At the same time, media and consumer organizations are also continuously exposing the improper behaviors of substandard AI toys and promoting the acceleration of relevant regulations.

We conclude:

• In the next 3-5 years, parents and children will gradually consider "intelligent interaction", "content upgrades", and "the ability to learn the habits and levels of children" as the "basic capabilities" of mid-to-high-end children's toys.
• However, the prerequisite is that the toy must be sufficiently reliable in terms of privacy protection, content security, and data transparency, and must provide clear instructions and parental control tools.

Simply put: AI features will be a selling point, but "safety and transparency" will be the prerequisite for entry.

3. Brands and distributors will increasingly rely on manufacturing partners who "understand both AI and children".

AI toys are no longer simply OEM products; they require the collaboration of a brand, content provider, AI technology provider, and manufacturer (or even four parties in total) to be successfully developed.

• The brand excels at understanding users and the market;
• The content provider is proficient in the educational system and story IP;
• AI technology providers offer models and basic algorithms;
• The manufacturer is responsible for hardware implementation, cost control, supply chain integration, and compliance implementation.

In this multi-party collaboration model, manufacturers are no longer merely "factories", but more like "solution integrators". For brands from Europe and America, finding a partner who understands the toy industry, possesses expertise in electronics and AI technologies, and can coordinate the entire project implementation will significantly reduce the cost of trial and error and the risk of project failure.

What we can do for you: One-stop service from product definition to implementation

Looking ahead to 2026, we clearly see the opportunities in AI toys, but we also recognize the risks. Based on our 20-year accumulation in intelligent educational products for children aged 3-12, we hope to collaborate with partners in the following areas:

1. Jointly define the next generation of educational and brain-training toys

We are skilled at transforming "vague ideas" into "clear product solutions".

For different age groups:

• 3–6 years old: More inclined towards early learning, simple interaction and emotional soothing, suitable for voice interaction, image recognition and story extension;
• 6–9 years old: Logical training, language learning, task reward system can be added;
• 9–12 years old: Suitable for more complex task systems, creative tools (stories, drawing, music), programming and STEAM projects.

2. Develop "AI-enhanced" electronic toys, not "AI replacing toys"

We view AI as an "enhancement layer," not the entirety.

The directions that can be explored together include:

• AI image and scene recognition: Using cameras to identify objects or scenes, providing voice prompts or extended content, such as a "go on an outdoor adventure" task.
• AI companion-based motivation: Establishing emotional connections with children through voice and animations, fostering good habits (exercise, reading, homework), rather than merely providing entertainment.

3. Utilizing our manufacturing and supply chain capabilities, accelerate the launch of your toys

Based on our unique understanding and definition of the toy market, we can offer:

• A one-stop service from ID/structure design, solution development, prototype verification, small-batch trial production to large-scale mass production;
• Familiar with mainstream toy and electronic product standards in the European and American markets (such as EN71, ASTM F963, etc.) as well as related EMC, battery, and safety certifications. Prejudgments are made at the design stage to reduce rework in the later stages.
• Flexible production scheduling and multi-category collaborative production capabilities allow you to test the market in batches and iterate products quickly.

Cheertone's Latest Project Timeline

Choosing Cheertone means choosing a reliable, professional, and future-oriented long-term partner. Partnering with us means you'll gain not only fast-to-market products, but also safe, compliant solutions that truly create value for children.

Conclusion: Standing in the right position in the era of AI toys together

We believe:

AI will not change the essence that children need love, companionship and games;

What it can change is how toys can better understand children, accompany them, educate them, and how brands can succeed in this space.

From Chenghai to Shenzhen, it took us 20 years to learn one thing: Truly excellent children's electronic and educational products need to convince three parties at the same time - the children, the parents, and the distributors. If any of these parties is ignored, the product cannot achieve lasting success.

What we can do is to work together with you to define and create such children's products:

• It is both fun and truly educational.
• It combines the intelligence of AI while also respecting the privacy and safety of children.
• It can be spotted at a glance on the shelf or in the live broadcast room, and it can also stay on the child's bedside, desk and backpack for a long time.

If you are looking for partners for the next generation of AI educational toys and children's electronic products, please feel free to share your ideas with us—whether it's a vague concept or an already developed product, we are willing to work with you to stand on the right position and turn your ideas into products.