HSAI — Hesai Group

Summary of Hesai Group Q1 2026 Earnings Call

1. Key Financial Results and Metrics:

• Total Net Revenues: RMB 681 million (USD 99 million), up 30% year-over-year.
• Lidar Shipments: Over 471,000 units in Q1 2026, with broad-based ADAS and robotics shipments more than doubling year-over-year.
• Gross Margin: Healthy at over 39%.
• Operating Expenses: Increased by 9% year-over-year, reflecting strategic R&D investments.
• Operating Profit: RMB 42 million from the lidar business; SGI segment recorded an operating loss of RMB 51 million.
• Net Income: GAAP net income of RMB 18 million (USD 2.7 million) and non-GAAP net income of RMB 48 million (USD 6.9 million).
• Profitability Track Record: Fourth consecutive quarter of GAAP profitability and sixth consecutive quarter of non-GAAP profitability.

2. Strategic Updates and Business Highlights:

• Partnership with Mercedes-Benz: Hesai is now a strategic lidar partner for Mercedes-Benz models enabling Level 3 autonomy, supported by a new manufacturing center in Thailand.
• Lidar Market Leadership: Ranked #1 globally in long-range ADAS lidar shipments with a 43% market share in 2025, which increased to 55% in March 2026.
• Product Innovations: Introduction of the Picasso 6D full color SPAD-SoC, enhancing lidar's role from passive to active safety enabler, and the Kosmo AI-integrated spatial intelligence device.
• Robotics Expansion: Significant engagement in humanoid and quadruped robotics, securing design wins across various applications.

3. Forward Guidance and Outlook:

• Q2 2026 Revenue Forecast: Expected to be between RMB 850 million to RMB 900 million (USD 123 million to USD 130 million), representing a year-over-year growth of approximately 20% to 27%.
• Full Year 2026 Expectations: Anticipating total lidar shipments of 3 million to 3.5 million units. SGI expected to contribute approximately RMB 100 million in revenues in 2026, with a scaling path to RMB 500 million by 2027.

4. Bad News, Challenges, or Points of Concern:

• SGI Losses: The strategic growth initiatives segment reported an operating loss, indicating ongoing investment without immediate returns.
• ASP Decline: Ongoing decline in lidar average selling prices (ASP) due to market expansion and product mix shift, although this is seen as a healthy signal of mainstream adoption.
• Competitive Pressures: The lidar industry is witnessing a shift towards performance enhancements, which may increase competition. Hesai must continue to innovate to maintain its leadership.

5. Notable Q&A Insights:

• Volume and Revenue from Mercedes-Benz Partnership: Specific volume and margin contributions from the partnership were not disclosed, but it was confirmed as an extension of existing collaboration.
• Kosmo's Differentiation: Kosmo is positioned as an AI-integrated spatial intelligence device, offering significant efficiency improvements over traditional methods, with a potential shift towards a recurring revenue model.
• Robotic Actuation Modules: Early signals in the robotic actuation space are promising, although detailed information is still forthcoming.
• Market Dynamics: The management emphasized the importance of technological leadership over price competition, highlighting their capability to innovate across multiple technology cycles.

This summary encapsulates the key takeaways from Hesai Group's Q1 2026 earnings call, reflecting both the company's strong performance and strategic direction, while also addressing challenges and competitive dynamics in the lidar market.