You are looking at the HTML representation of the XML format.
HTML is good for debugging, but is unsuitable for application use.
Specify the format parameter to change the output format.
To see the non HTML representation of the XML format, set format=xml.
See the complete documentation, or API help for more information. 
<?xml version="1.0"?>
<api>
  <query-continue>
    <allcategories accontinue="Equipment" />
  </query-continue>
  <query>
    <allcategories>
      <c size="0" pages="0" files="0" subcats="0" xml:space="preserve">Article message templates</c>
      <c size="1" pages="1" files="0" subcats="0" xml:space="preserve">Article message templates with missing parameters</c>
      <c size="1" pages="1" files="0" subcats="0" xml:space="preserve">Articles to be expanded</c>
      <c size="89" pages="89" files="0" subcats="0" xml:space="preserve">Autoquest Walkthroughs</c>
      <c size="1" pages="1" files="0" subcats="0" xml:space="preserve">Beginner's Guide Books</c>
      <c size="2" pages="2" files="0" subcats="0" xml:space="preserve">CPK</c>
      <c size="1" pages="1" files="0" subcats="0" xml:space="preserve">Calls to Module:Unsubst that use $N</c>
      <c size="1" pages="1" files="0" subcats="0" xml:space="preserve">Catacombs</c>
      <c size="0" pages="0" files="0" subcats="0" xml:space="preserve">Cleanup templates</c>
      <c size="0" pages="0" files="0" subcats="0" xml:space="preserve">Component Equipment</c>
    </allcategories>
  </query>
</api>