Summary of Hesai Group Q2 2026 Earnings Call

1Key Financial Results and Metrics

Total Net Revenues: RMB 861 million (USD 127 million), up 22% year-over-year, marking the ninth consecutive quarter of revenue growth.

Gross Margin: Maintained at 40%.

GAAP Net Income: RMB 71 million (USD 10 million), a 60% increase year-over-year, representing the fifth consecutive quarter of profitability.

Non-GAAP Net Income: RMB 101 million (USD 15 million).

Lidar Revenues: RMB 816 million (USD 120 million) with operating profit of RMB 66 million (USD 10 million).

Lidar Shipments: Over 628,000 units, an 80% increase year-over-year; ADAS lidar shipments increased by 60%, while robotics lidar shipments grew by 193%.

Strategic Growth Initiatives (SGI) Revenues: RMB 45 million (USD 7 million), marking the segment's first revenue contribution.

2Strategic Updates and Business Highlights

Business Model Transformation: Hesai is evolving into a full-stack infrastructure platform for robotics and physical AI, focusing on three layers: "See" (lidar), "Understand" (Kosmo AI platform), and "Act" (actuation modules).

ADAS Market Leadership: Secured design wins with major automakers, including Great Wall Motor and Volkswagen, and maintained a 44% market share in China's long-range ADAS lidar market.

Robotics Expansion: Significant growth in robotics lidar shipments, with partnerships established with over 50 AI companies. The JT128 lidar is becoming a preferred choice for humanoid and quadruped robots.

Kosmo Platform: Initial orders for Kosmo were secured within a week of prototype shipment, indicating strong early demand across various sectors, including robotics and media.

3Forward Guidance and Outlook

Q3 2026 Revenue Guidance: Expected between RMB 1.1 billion to RMB 1.15 billion, with lidar shipments projected at 800,000 to 850,000 units.

Full Year 2026 SGI Revenue Guidance: Raised from RMB 100 million to a range of RMB 200 million to RMB 300 million, with expectations for SGI to reach approximately USD 100 million in 2027 and achieve breakeven.

Lidar Shipment Guidance: Reiterated at 3 million to 3.5 million units for the full year, with anticipation of a stronger second half due to seasonal trends.

4Bad News, Challenges, or Points of Concern

Competitive Pressures: Increased competition in the lidar market, with new entrants potentially affecting pricing and market share.

Regulatory Risks: Upcoming mandatory safety standards for Level 3 and Level 4 vehicles in China (effective July 2027) may pose challenges for compliance and integration timelines.

Market Dynamics: The potential for pricing pressure as more suppliers enter the market, although management emphasized a focus on quality and technology over price competition.

5Notable Q&A Insights

Actuation Modules: Management highlighted the significant long-term revenue potential of actuation modules, estimating demand could approach 1 trillion units. They emphasized the importance of real-world validation through partnerships, particularly with Sharpa.

Kosmo's Business Model: Kosmo is positioned as a comprehensive platform for creating and managing 3D spatial assets, with a focus on recurring revenue from cloud services and licensing.

Customer Dynamics: Concerns were raised regarding Xiaomi's collaboration with RoboSense; however, management viewed this as a positive trend for the industry, indicating a growing recognition of lidar's value in vehicles. Overall, Hesai Group's Q2 2026 results reflect strong growth and strategic advancements, particularly in lidar and robotics, while navigating competitive pressures and regulatory challenges.