Not sure how familiar you are with the game, and I love hearing myself talk (so to speak) so you get the really long version
Your economy is split into factories and labs. They don't produce a flat amount per, they convert dollars into beakers and hammers... so more labs or more factories lets you convert more dollars into beakers or hammers. So far, no problem.
The problem is, for some reason they decided it would be a good idea to force you to choose between the two. You can run factories at 100%, or you can run labs at 100%, or you can run them both at 50% (or whatever combination you want, it's a slider). This means if you want to build a spaceship fast on one planet, you have to literally shut off your research completely for your whole empire... and if you want to research something quickly you need to stop upgrading buildings on your planets, even the ones with no labs. It also means you're always wasting slots on planets (and planet slots are very precious) since you can't ever run everything at 100%. Note - this is completely arbitrary, it's quite possible to have enough money to run both at 100%, and it's not an issue of population (since how many people you have does not influence production) it's just the way the game is.
HOWEVER - you can press a button on a planet that converts beakers to hammers, or hammers to beakers. Yeah, that's right - you can somehow make your laboratories build spaceships, or your factories do high tech research. It's not a perfect conversion, they produce less and there's some waste... but it's a LOT better then the alternative of letting building sit around half used.
So that leads to the "all X" strategy. You either build all factories, or all laboratories (there's advantages and disadvantages to both), and then just convert to hammers or beakers as needed. It also has the huge advantage of only requiring one tree worth of research (no need to upgrade factories if you're going all labs) which saves a ton of beakers too. Since the AI does not do that, you can easily outproduce him in beakers and/or hammers by a truly massive amount.
Second... the combat system is designed such that ships fight to the death, and there's never any ties. However, both ships fire at the same time which means they can possibly destroy each other... but there's not allowed to be a tie. So how does it decide? very simple, the ship with the most guns (well, highest offensive rating) wins. That means if you have a ship with enough guns to completely destroy the enemy ship in one round, as long as the enemy ship does not have a higher offensive rating that ship is immortal, and will always win any combat with 1 hp left. Combine that with the fact that every weapon type is good against two armors, but each armor is only good vs one weapon... and the obvious strategy is to just stack as many guns as possible, completely ignore all defense. The AI does not realize that, and tries to build balanced ships, which means sometimes you can destroy his whole armada with a single 1 hp ship.
Third - fleets. Fleets are supposed to be a bonus, in fact you need special researches to make bigger fleets. However, again because every ship gets to fire in a combat round that means you are better off not grouping your ships in fleets. Why? take this example - you have 10 ships that are all guns. The enemy also has 10 ships. Your ships can kill two of his per volley since they are all guns, and his can kill two of yours since you have no armor. You send them in a fleet vs his fleet, the end result is you win after one round, with a single ship with 1 HP left (since you have more offensive rating).
Send them in one at a time however and what happens? You one ship fires, kill two of his. His 10 ships fire and massively overkill your ship. He now has 8 ships, you have 9. Send in the next ship, he's got 6 ships you have 8... keep repeating it and eventually you have 6 ships left, 5 undamaged and one with 1 HP left. The enemy has zero ships left.
In short, fleets are completely terrible and actually harmful to you. And... you guessed it... the AI loves fleets and makes them all the time.
Well, anyway, sorry if there's any small mistakes in that long rant I haven't played in a very long time (the sliders make me mad just thinking about it) so I might be misremembering a little bit.
Edit: that's not even touching on diplomacy, as kolbur mentioned, which is also completely and hilariously broken to the point that with a big enough diplomacy bonus (from research and/or racial picks) you can basically make the AI empires do whatever you want for pocket change.