From SmashWiki, the Super Smash Bros. wiki
The following is a list of flaws in the artificial intelligence of Project M.
General
Attack choices
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CPUs tend to target the player who has the highest damage more than the others.
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All
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When standing near an edge a CPU may air dodge off the stage attempting to wavedash of the ledge to grab it, instead missing the ledge and self-destructing.
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All
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Recovering
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CPUs will never attempt to fight off edgeguarders.
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All
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CPUs will occasionally air dodge attempting to evade edgeguarders, reguardless of how far away they are from the stage. Because air dodges make players helpless this makes them fail a possible recovery.
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All
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Excluding Jigglypuff, CPUs never use directional air dodges to recover, even if it would be beneficial for certain characters like Ness and Lucas when recovering in narrow spaces.
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Almost all
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CPU Zero Suit Samus never uses Plasma Whip to recover. Additionally when recovering, she almost never uses Plasma Wire in the grappling range, missing the ledge as a result and failing a possible recovery.
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CPU Lucas normally aims PK Thunder upwards and slightly away from the stage, failing a recovery that was possible if he aimed differently.
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CPU Lucas never uses Rope Snake to recover.
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When facing away from the ledge, CPU Pikachu will never use its second dash of Quick Attack and fail a possible recovery.
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Carried over from Brawl
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CPU Ike does not use Aether to recover unless he is directly below the ledge, often using it too late and failing to recover.
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Others
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CPUs will immediately leave their revival platform upon responding, even if a dangerous event is occurring such as the opponent having a Final Smash.
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All
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Character Specific
 
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CPU Fox, Falco, and Wolf will often abruptly cut their side specials short when recovering, and fail to make it back on the stage.
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CPU Fox will spam short hop lasers when far away from another player. This allows characters with absorbing specials like Ness to easily heal critical damage, or characters with reflectors to reflect the lazers back at him to damage him.
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Even in situations where the other player has recovered, CPU Falco will frequently use his down air at the edge of a stage in an edgeguarding attempt, which can be extremely hazardous and often lead to a self-destruct due to Falco's high falling speed.
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When no players are nearby, CPUs Mewtwo and Lucario will indefinitely stay in place charging their respective neutral specials, until another player comes near or attacks with a long range projectile.
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CPU Jigglypuff will often air dodge when launched directly upwards above a player, putting it in a helpless state and leaving it open for punishes.
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