I have played several games now and each of the games the AIs vastly outnumber me in military. Yet my fleets destroy theirs since I check what defence and offensive weapons they have and then fit my ships accordingly. However the AI seems to not adapt to that. They keep sending fleets with attack, which I have high defence against, and fail to fit defensive measures against my primary attack.
I think the AI should adapt better. If they are at war with me, or have bad relationships with me, they should scout out my fleet and fit according to my strength and weaknesses. Otherwise this type of combat is just another tool which we can use to best the AI.