For decades, building blocks, puzzles, and dolls defined the landscape of children’s play. Today, that landscape is shifting rapidly. A new wave of AI-powered toys is transforming how children as young as five engage with playtime—infusing it with technology, education, and interactivity once reserved for older users.

Technology has become a fixture in the global toy industry, but blending innovation with childlike fun remains a complex challenge. Brands targeting younger children face two questions: Will kids stay engaged? Are parents willing to pay?

The toy industry has always mirrored advances in technology. From mechanical puzzles to electronic gaming devices, every innovation has reshaped how children learn and play. Today, we see the spotlights shifting to smart toys.

LEGO has stood as a universal symbol of creativity for decades—simple blocks that can turn into anything a child can imagine. Similar to how LEGO defined the potential of toy creativity, the concept of toys is being reshaped once more. Artificial intelligence is pushing smart toys beyond passive objects into responsive companions, altering how children play, learn, and experiment with ideas.