The AI is good, better than any game AI except Chess but if you expect it to beat your ass, game after game, you might be disappointed. After playing a while you will start to notice weaknesses.
At intelligent and above it generally does a good job of keeping up with you in terms of development of economy,military etc. I can out develop the AI, but it is done using somewhat cheesy customised economy/pop race + colony rush but otherwise it seems to out develop me most of the time.
Sometimes it makes little weird choices in colony management but nothing's perfect.
However it's weakness becomes glaring once a war starts. Basically it is way too defensive and doesn't seem to understand the advantage of taking the first strike.
I was in a war with the Yor, it was a war they declared, I was behind in all areas, except research where I was slightly ahead but weapon tech wise we were roughly equal. I was caught flatfooted, I had no military, my colonies were all filled with research builidings (i was trying a netural learning center strategy but seemed to have botched it), I thought it was basically game over.
But I played it out. I moved to a war footing, designed my first Missile boat, armed with 2 warp engines (speed 7) and
Harpoon missilesx2 . Started to build factories and starports on other colonies near the frontier, in theory it was too little too late.
But the AI , just sit there for a couple of turns, enough time for my capital world to crank out the first missle boat, just in time to destroy a transport that was escorted by a ship similar to my missile boat. But because I got the first attack, i blew it out of the water.
That battle was pretty much replayed the whole war, I always got the first attack and ensured that i had sufficent firepower to destory them without getting any return fire (usually). So it didn't matter if they had 20+ attack ships. My fleet of 2-3 ships could blow their medium ship out of the water before they returned fire.
Also There were times where the computer should have attacked my ship with one of theirs, but they never did. It wasn't even a matter of superior sensors, at that point in time i did not research sensors (though I was technologist, and had the +1 sensor bonus).
I had no problems at all, holding back their laughable attacks, with just a few missile boats. It also helped that the frontier was closest to my homeworld, so their attacks ran straight into my newly constructed ships.
Also they are way too defensive, spending valuable resources, building defensive ships just for defensive purposes. That was stupid, all you need is one-two medium ship per star system, with adequate speed and sensor for defense to intercept attacking fleets.
And the stupid AI still kept thinking it had a way superior military until it was way too late, because they had a ton of 'defenders ships' armed with 20-30 attacks, but were pointless because they were none mobile, and hence never got to fire before they were destroyed.
On the plus side, they did adapt, and add defenses, but by then I had my large ships online with proton torperdos so even defenses didn't help much.
And then I finished the sensor tech tree, and built eyes of the universe.... It was game over obviously.