HSAI

Image source: The Motley Fool. Tuesday, Aug. 18, 2026 at 8:00 a.m. ET Head of Capital Markets - Yuanting Shi Co-Founder and Chief Executive Officer - Yifan Li Chief Financial Officer - Peng Fan Operator: Hello, ladies and gentlemen. Thank you for standing by. Welcome to Hesai Group's Second Quarter 2026 Earnings Conference Call. [Operator Instructions] Please note that today's conference call is being recorded. I will now turn the call over to our first speaker today, Yuanting Shi, the company's Head of Capital Markets. Please go ahead. Yuanting Shi: Thank you, operator. Hello, everyone. Thank you for joining Hesai Group's Second Quarter 2026 Earnings Conference Call. Our earnings release is now available on our IR website at investor.hesaitech.com as well as via Newswire services. Today, you will hear from our CEO, Dr. David Li, who will provide an overview of our recent updates. Next, our CFO, Mr. Andrew Fan, will address our financial results before we open the call for questions. Before we continue, I refer you to the safe harbor statement in our earnings press release, which applies to this call as we will make forward-looking statements. Please also note that the company will discuss non-GAAP measures today, which are more thoroughly explained and reconciled to the most comparable measures reported under GAAP in our earnings release and SEC filings. With that, I'm pleased to turn over the call to our CEO, Dr. David Li. David, please go ahead. Yifan Li: Thank you, Yuanting. Hello, everyone. Thanks for joining us. Let me start with the headline. The second quarter of 2026 marks a major turning point for Hesai. We are opening a truly exciting new chapter in our history. Over the past decade, we have built the technology, manufacturing engine and commercial scale required to lead the lidar industry. Today, we are setting our sights on a much larger opportunity, expanding Hesai into a full stack infrastructure platform for robotics and physical AI, empowering them to see, understand and act. The simplest way to think about Hesai now is 3 layers. First, see. Our lidar lets intelligent machines see the physical world, what things are, where they are, how fast they are moving and how the scene changes around them. Second, understand. Kosmo turns real environments into reusable AI-ready 3D spatial assets, so intelligent machines learn from the world instead of guessing at it. Third, act. Our robotic actuation modules turn intelligence into precise physical motions. We are already seeing commercial momentum across all these layers. Our core lidar business keeps scaling profitably and generating strong cash flow. Kosmo shipped prototypes in July 2026 secured initial orders and remains on track to contribute revenues in the third quarter of 2026. Actuation modules started generating revenues in the second quarter of 2026 and are ramping fast. Together, these 3 layers form an integrated platform, opening up a significantly larger addressable market than we saw a year ago. Let me start with See. ADAS was our first big commercialization market and is still a phenomenal cash engine. Think about it. A modern intelligent car is arguably the most widely deployed robot on earth. And the industry has moved beyond the question of can the car drive itself? The question now is whether it can do it safely every single time with backup when something fails. That's a completely different bar. Regulation is catching up fast. In China, the first mandatory national safety standards for Level 3 and Level 4 will take effect in 2027. In the U.S., proposed New Jersey legislation would require commercial autonomous vehicles to run 2 independent sensing technologies beyond cameras, typically lidar and radar. So the vehicle still sees when the cameras don't. This is what we have been saying for years, lidar is the invisible airbag. You never think about your airbag on a normal drive. But the one time you need it, it is the difference between a bad day and a catastrophe and nobody removes airbags to save bucks. So the market is shifting from does it have lidar to better lidar and more lidar. Better means longer range, higher resolution, rock-solid reliability where it matters. This quarter, we won a design win with Great Wall Motor for mass production programs using our ultra-long-range high-end ETX lidar with SOP expected in late 2026. ETX extends detection range to more than twice that of ATX, while ATX has already established itself as the benchmark for cost-efficient lidar. More means multi-lidar, full coverage and higher redundancy. Momentum on our FTX blind spot lidar is strong. Changan and other leading OEMs picked Hesai for multi-lidar programs and Li Auto's L8 and L9, each equipped with 4 Hesai lidars are now in mass production. Li Auto's newly launched L6 model priced around RMB 250,000 now offers an optional 4 lidar configuration -- 4 lidars at a mainstream price point. That is the moment an advanced feature goes mass market, and that is how content per vehicle compounds. Globally, we are accelerating too. Following Mercedes-Benz, we won a major design win with Volkswagen covering multiple models from its China joint venture brands and expanded collaboration with GAC Toyota. We are also riding along with Chinese automakers that are going global with meaningful overseas volume expected in 2027. Our leadership is also reflected in third-party market data. Per Gasgoo, we took 44% of China's long-range ADAS lidar market in June 2026 and have been #1 in China for the long-range ADAS lidar market for 17 straight months. Now here is where it gets fun. That same demand for high-performance 3D sensing is expanding rapidly into humanoids and other intelligent machines. Morgan Stanley estimates that robots could deploy roughly 6x as many lidar sensors as automotive by 2050. You can only drive one car at a time, but in the future, you might interact with many different robots in a day. We are already leading this trend. We work with more than 50 embodied AI companies worldwide with recent orders coming from Unitree, Robbyant, Galbot, Galaxea, Dexmal and many others. Our JT128 has become the go-to lidar for humanoid and quadruped robots, and the numbers are frankly remarkable. Robotics lidar shipments in the second quarter almost tripled compared with the same quarter last year, following year-over-year growth of 47% in 2023, 67% in 2024 and 426% in 2025. And we expect another 2 to 3x shipment increase in full year 2026. The next leap is going from geometry to [indiscernible]. Classic LiDAR gives you the skeleton of the world, distance, shape and position. A robot needs to know what a thing is, not just where it is. That is Picasso, our full color ultrasensitive 6D SPAD-SoC. People love to frame the debate as camera versus lidar. That is like asking a human to choose between color and depth. You need both. Picasso fuses them on one chip. We are pleased to share that the Picasso SoC is now SOP ready. Since its launch in April 2026, the full color ETX powered by Picasso has secured initial design wins, including KargoBot. It is now undergoing customer validation and advancing into RFI and RFQ discussions with leading robotaxi operators and global automakers. Because depth and color come off one chip under one time stamp, you get intrinsically time-aligned multimodal information, exactly the fuel world models need. We believe Picasso will be the eyes of the next generation of robots. Then layer 2, understand. Helping robots understand and learn from their environments. This is where Kosmo comes in. Kosmo is a spatial intelligence platform that integrates an AI spatial camera, AI algorithms, 3D spatial assets and cloud services into one unified system for capturing, reconstructing and understanding the physical world. It addresses the sim-to-real gap bottleneck. Robots need enormous digital representations of the physical world that are geometrically accurate and physically grounded. Training on bad inputs is like teaching a kid from a blurry textbook, plenty of pages, but they may learn the wrong things. Kosmo makes the textbook sharp. It turns real environments into high fidelity, editable, interactive 3D assets, reality itself as the training ground. That is exactly the foundation robotic scaling laws need without the model collapse risk from low-quality inputs. Validation came fast. Prototypes went out this July. And within 7 days, we had orders from a lineup of leading humanoid robotics companies, including Galbot. Customer feedback has been extremely encouraging. Kosmo reconstructs a 200 square meter restaurant at roughly 5x the efficiency of a leading alternative with such high fidelity that even 4 millimeters text on a menu remains clearly visible. Scale that across thousands of scenes and you get the generalization robots need to walk into an actual home. Kosmo also goes well beyond robotics, cultural tourism, film and TV, games, advertising and beyond. Imagine standing on stage at a concert or on the field for historic sporting moment. Kosmo turns real places into reusable digital assets. Since the April preview this year, more than 200 prospective partners have come to us and initial revenues are expected to land in the third quarter within SGI. But the part which I am most excited about is the business model of Kosmo. The AI spatial camera is the front door. Behind it is proprietary algorithms, cloud services and a compounding library of 3D spatial assets. Every deployment adds assets. A richer library enables more applications, more applications attract more users, more users create more assets. That is a flywheel, recurring revenues, network effects and real operating leverage. Kosmo doesn't digitize a space once. It compounds the value of that space over time. Layer 3 is act, the muscles. JPMorgan sees 2026 as a milestone year for humanoids. Actuation modules can be more than half a robot's BOM and robot may need more than 100 modules. Run that math and long-term demand could approach 1 trillion units, 1 trillion, it is also brutally hard engineering. You need strength and precision in something compact, efficient, durable and consistent like asking a pro athlete to run a marathon every day for years without losing a step. This is exactly our wheelhouse. For more than a decade, we have built precision electromechanical systems, in-house chips, material science, thermal engineering and automated manufacturing. People think lidar is a sensor, but it is not. It is a precision machine where optics, electronics, software, motors and encoders stay in perfect sync through heat, cold and vibration for years. The physics of a lidar scanner and a robot joint are cousins, both demand precise control of position, speed and force. Going from helping robots see to helping robots move is the most natural extension we have ever made. We rebuilt the entire actuation stack from first principles, materials, structure and system integration. The result is a breakthrough in actuation modules, roughly 3x the torque density and power density of leading products available today in a package 37% smaller with transmission efficiency above 95% and performance validated through 2 million operating cycles. We deliberately started with the hardest system in humanoid robotics, the dexterous hand. Walking gets the robot to the workstation, hands are what make it useful once it arrives. Starting with this demanding hand application allowed us to validate our architecture at the highest level before extending it across the rest of the body. That strategy is already converting into revenues. We are supplying actuation modules to Sharpa, a global frontrunner in AI robotics. In August 2026 in Shanghai at a Dairy Queen store, a Sharpa humanoid is expected to complete what we believe is the world's first zero retrofit commercial deployment of its kind. The robot is set to autonomously work a full DQ shift preparing signature Blizzard ice cream treats, a complex long horizon challenge while demonstrating the potential to generalize across diverse real-world tasks. That is the whole point. Robotics is not about impressive lab demos. It is about useful work done repeatedly and reliably in a real operating environment. And as Sharpa earns market recognition and its backlog grows, our volume grows with it. At the same time, real-world field experience feeds directly back into engineering, creating another powerful flywheel for our product development. Our dedicated production line is fully operational. Cumulative shipments exceeded 10,000 modules by the end of the second quarter. We are ramping toward roughly 10,000 modules per month in the near term and expect 6-digit volumes in 2027. Meanwhile, full body modules SOP is expected in the second half of 2026, expanding into shoulder and wrist joints. Beyond robotics, these modules fit anything needing dense, precise, reliable motion. This is only the beginning. As intelligent machines proliferate across industries, we believe the addressable market for high-performance actuation will expand dramatically. Let me close by returning to the bigger transformation we are witnessing today. If digital AI gave machines a voice and a mind, physical AI is giving them eyes to see, a body to move and the ability to act in the real world. Hesai is becoming a full stack infrastructure platform for robotics and physical AI, empowering them to see, understand and act so as to power the AI-driven Fourth Industrial Revolution. With that, I will turn it over to Andrew for our financials and outlook. Andrew, please go ahead. Peng Fan: Thank you, David. Hello, everyone. The second quarter of 2026 once again demonstrated our ability to deliver solid growth at scale while investing in Hesai's next chapter. As we introduced last quarter, we now manage and report our business through 2 segments: our core lidar business and our strategic growth initiatives or SGI, giving investors greater visibility into their distinct financial profiles and the growth trajectories. With that framework in mind, let me begin with our consolidated financial performance. Total net revenues for the quarter reached RMB 861 million or USD 127 million, representing an increase of approximately 22% year-over-year. The second quarter of 2026 marked our ninth consecutive quarter of year-over-year revenue growth. Gross margin remained healthy at 40%. On operating expenses, we remain disciplined while continuing to invest in long-term growth. Sales and marketing expenses were RMB 50 million. General and administrative expenses were RMB 67 million and research and development expenses were RMB 231 million. The increase in R&D primarily reflected our targeted investments in the SGI opportunities that David discussed earlier. Even with these continued investments, we maintained solid profitability. GAAP net income reached RMB 71 million or USD 10 million, representing an increase of 60% year-over-year, marking our fifth consecutive quarter of GAAP profitability, demonstrating the strength of our operating model and the financial foundation built by our lidar business. Non-GAAP net income was RMB 101 million or USD 15 million. Now let me turn to the performance of each segment, beginning with our core lidar business. Lidar revenues reached RMB 816 million or USD 120 million. The segment generated operating profit of RMB 66 million or USD 10 million, demonstrating strong profitability and cash-generating capacity. Total lidar shipments reached over 628,000 units, up close to 80% year-over-year. ADAS lidar shipments increased approximately 60% to over 485,000 units, while robotics lidar shipments grew approximately 193% to over 142,000 units. The accelerating growth in robotics, alongside the continued expansion of ADAS further demonstrates the breadth and resilience of our lidar business. Turning to SGI. The second quarter marked the segment's first revenue contribution, an important step from technology development to commercialization. SGI revenues reached RMB 45 million or USD 7 million, driven by strong early demand for our robotic actuation modules. The segment recorded an operating loss of RMB 64 million as we continue to invest in product development, commercialization and production capacity to support the future growth of both our robotic actuation modules and Kosmo. I am especially pleased to share that SGI commercial momentum has significantly exceeded our expectations. Our robotic actuation modules are already generating revenues, while Kosmo remains on track to begin contributing revenues in the third quarter of 2026. Given this strong momentum, we are raising our full year 2026 SGI revenue guidance from RMB 100 million to a range of RMB 200 million to RMB 300 million. We are particularly encouraged by SGI's growth trajectory and expect the business to reach approximately USD 100 million in 2027 in revenues and achieve breakeven in the same year. This gives us increasing confidence in Hesai's dual engine growth model. Our lidar business continues to deliver scale, profitability and cash generation, while SGI is rapidly emerging as a powerful new growth engine. Together, they position Hesai to capture the enormous opportunities ahead in robotics and physical AI. With that, this concludes our prepared remarks today. Operator, we are now ready to take questions. Operator: [Operator Instructions] Our first question comes from Tina Hou with Goldman Sachs. Tina Hou: So my question is really regarding the actuation module. So obviously, you have raised your revenue guidance for the strategic growth initiatives. And also, I think starting from June, second quarter, we've seen more news regarding Sharpa's collaboration with not only NVIDIA but also Google Gemini Robot. So just wondering if you could share more details regarding these and other future potential collaborations. At the same time, what would be the long-term revenue potential for this business? And also how do we achieve the strategic synergies for the partnership with Sharpa between -- Sharpa and Hesai? Yifan Li: Thanks for the question. This is David. I'll take this question. Look, Hesai is building a full stack infrastructure platform for robotics and physical AI, empowering them to see, understand and act. And these are capabilities that take years of R&D engineering and real-world validation to build, right? Since day 1, Hesai's vision has always remained the same, empower robotics, elevate lives. Lidar happened to be the first commercial product through which we demonstrated that we could build a leading technology platform and scale it globally, but that is not the end of our journey you see. It is just the beginning. And I myself am also a co-founder of Sharpa, a humanoid robotics company that has gained meaningful recognition globally, including recent adoptions by Gemini Robotics and NVIDIA. And very soon, Sharpa is expected to begin its first real-world commercial deployment at a Dairy Queen store in Shanghai. We believe this will be the first deployment of its kind, not a lab program demonstration, not a pop-up showcase, but a regular operating store with the robot performing tasks autonomously in a real commercial environment. And that means this is an important milestone, right, because it demonstrates what humanoids can potentially achieve when they move beyond demonstrations and into a real operating environment. For Hesai, you know Sharpa can serve as a valuable real-world proving ground. We already supply lidar to a diverse pool of robotics companies and expect to ship more than 500,000 units this year. Through Sharpa, we can also gain firsthand insight into what actuation systems actually need to deliver in real-world environments. And that creates a powerful feedback loop. Hesai puts its technologies onto robots. The robots in turn tell us what the market really needs, from performance metrics and form factors to reliability requirements, [indiscernible] cases, cycles and total cost of ownership. We cannot fully capture those insights in [indiscernible] a robot operating in the real world day after day and even more importantly, from a company founded by the same founding team with firsthand understanding of both the technology and the end application. Let me give you a few constant examples of this flywheel. For a humanoid, lidar is typically more about resolution, field of view, compactness and robustness than simply maximizing the detection range. And for actuation, the requirements go well beyond reliability, performance, consistency, durability and performance on the real load all matter. These are the kind of requirements that become much clearer when you are building and operating the robot yourself. And that is a difference, right, between being a component supplier and being a supplier with firsthand knowledge of how the end product actually works in the real world. Our supply of products and provision of manufacturing services to Sharpa act as a high-signal test bed and learning platform before bringing our products to the broader market. As disclosed in the announcement and circular for the continuing connected transactions with Sharpa, we are seeking to increase the annual cap under the supply of products framework agreement with Sharpa from RMB 100 million to RMB 300 million, subject to shareholders' approval at the EGM with the majority of this year's transactions expected to be in actuation modules. Longer term, the opportunity is much broader than Sharpa. Our products are all designed to serve third-party customers at scale. If physical AI is entering a period of rapid adoption, Hesai's role is to provide the foundational infrastructure effectively selling the shovels in the physical AI gold rush. Sharpa, you see gives us a way to sharpen those tools faster, validate them in the real world and understand what the market will need next. That is the strategic value of the flywheel. Sharpa is the proving ground, while the broader physical AI market is the opportunity. That's my answer to your question. Thank you. Operator: Our next question comes from Tim Hsiao with Morgan Stanley. Tim Hsiao: This is Tim from Morgan Stanley. Congratulations on this exciting new chapter as management just mentioned. So just a quick question about the actuation modules. Just could you please give us more colors on Hesai's humanoid robot actuation modules and how they fit into your broader robotic strategy? And what kind of financial profiles do you expect these products to have over time? And are you currently shipping those products to customers beyond Sharpa? Those are my questions. Yifan Li: Thank you. This is David. Okay. Three questions really. Do we want to do it? Is the market ready to do it? And can we do it well? Want it? Easy, yes. Actuation can be more than half a robot's BOM. One humanoid may need over 100 modules. Run that math and long-term demand approaches 1 trillion units, 1 trillion, and the margin profile is currently around 40%. That's the market we want, right? The second question, ready? Yes. Humanoids are hitting volume and real-world deployment starting this year. Every robotics company is hunting for great joints, but they're hard to find. A lot of suppliers don't have firsthand knowledge of what leading robot makers need or why those metrics matter. Joints are both critical and hard, power, precision, size and durability all at once, like asking a pro athlete to run a marathon every day. The third question, can we... Operator: The next question comes from Jeff Chung with Citi. Ming Chung: Congratulations on the excellent result. My question is about the SGI. What drove the increase in SGI revenue guidance previously set? And how should we think about the revenue mix between robotic actuation modules and the Kosmos in SGI? Peng Fan: Okay. I know a lot of our investors care about this. We actually raised the full year 2026 SGI revenue guidance from RMB 100 million to a range of RMB 200 million to RMB 300 million. For 2027, we are now looking at roughly USD 100 million, about RMB 700 million. And most excitingly, SGI is expected to reach breakeven in 2027. This is because commercial demand and the speed of tech validation came in well ahead of what we originally modeled. That's also a strong signal. Hesai is evolving into an infrastructure platform for robotics and physical AI, not just a lidar company. The main SGI driver this year is robotic automation -- actuation built on more than a decade of engineering experiences. These products matured fast and started generating revenue in Q2. Demand from Sharpa has been the major source of our revenue for robotic actuation. Sharpa produced one of the first humanoids, maybe the first actually deploying into real restaurants with a path to scale. That demand for our actuation products ran ahead of expectations, which is why we raised the annual cap for the continuing connected transactions under the supply of products framework agreement with Sharpa from RMB 100 million to RMB 300 million. A quick clarification that RMB 300 million is the maximum amount for the transactions with Sharpa under the supply of products framework agreement, subject to shareholders' approval at the forthcoming EGM. Kosmo, our spatial intelligence platform is the other SGI pillar, and it's moving fast, too. Prototypes shipped in July. Initial orders came within 7 days. It's well on track to start contributing revenue in Q3. We are not breaking out any exact revenue split between these two at this early stage. Directionally, actuation is expected to be the majority of SGI revenue in 2026. Kosmo's initial contribution this year will be smaller, low 8-digit revenue. Because commercialization starts later this year and the higher-value cloud services compound with deployment scale over time. That revenue mix between the 2 pillars should look different in 2027. As Kosmo matures from the AI spatial camera into cloud processing, subscription and licensing of high-quality 3D spatial assets, its contribution should rise meaningfully. More importantly, a growing share of Kosmo's revenue is expected to be recurring cloud services under the business model we described earlier at structurally higher margins as expected. So the raised SGI guidance is really about actuation commercialization faster than expected this year and next, with Kosmo set up to become another meaningful contributor as the platform scales. Operator: The next question comes from Nora Min with UBS. Nora Min: This is Nora from UBS. I have a quick question on Kosmo. Can you brief us the business model of Kosmo, its existing and potential customers, and lastly, the delivery schedule of Kosmo? Yifan Li: Thank you. This is David. I apologize, there's like some errors about muting different lines on the operator side. Can you hear me okay? Nora Min: Yes, I can, David. Yifan Li: Good. Well, I guess this is a part that we still need to work on the AI or the training data to make sure it's not a part of the reinforcement learning experiment. Okay. So Kosmo is actually a super exciting product. We previewed the Kosmo in April and more than 200 prospective partners have reached out, robotics, film, gaming, tourism, luxuries and more. It keeps expanding. And the breadth is a signal that this isn't a niche gadget for one vertical. Think about what 2D camera became over decades, the infrastructure of how the world gets captured and consumed. Kosmo is that except this time, it's 3D and AI-driven. Anywhere a regular camera works today, there is a much bigger opportunity digitizing the physical world in 3D. I prefer not to put out a specific TAM or order value for a customer right now at this early stage because we simply don't know how big this could be. And a lot of customers are still in prototype testing and pilots. What matters to me is who is buying into this, who is testing hard and who is already ordering and how fast that moves. We started shipping prototypes in July. And within 7 days of the first deliveries, we got strong feedback and locked in initial orders, and that is the real case. Early demand is clustering in 2 key areas as we see. And the first one is the part we're super familiar is the robotics. It's a sharper near-term pull because humanoids are hitting early mass production this year, and they are hungry for high-quality training inputs to unlock scaling. The ceiling today is sim-to-real. A robot can look flawless in simulation and a fall apart the second it walks into a real factory or home. Train on weak spatial data that you're getting from a blurry textbook, reading it 100x doesn't read the [indiscernible]. Kosmo turns real environment into high fidelity, physically grounded 3D assets, richer training set, better yield performance, less risk of model collapse from a [indiscernible] data. The second one is more interesting. It's actually the media and digital content. We're talking about the gaming, film, luxury tourism, AI short-form advertising, et cetera. Content has been stuck in 2D for decades. It needs a dimensional upgrade. These applications share the same goal to make the physical world immersive and reusable. A store set, a concert, a historical site stops being a one-off shoot and becomes a 3D spatial asset that's reusable. You're not photographing the world. You're turning it into a new class of content. Film production is the clearest example. Traditional pipelines lean on green screens and cleared practical shoots, expensive, inconsistent and slow. Kosmo changes that equation, higher quality, higher consistency and lower cost. I can't name who we are in close talk with yet, but they are household names globally. Kosmo is a spatial intelligence platform, AI spatial camera, algorithms, 3D assets and cloud services, one system. The device is just the front door. The real value compounds behind it. More devices mean more inputs that deepens the asset liability, unlocks more applications, pull in more customers and drive recurring revenue through cloud usage and asset licensing. That's where the operating leverage shows up. So early commercial traction is real. Orders and prototypes are just the first turn of the wheel. Recent feedback has already validated both our technology and the business blueprint. We are very excited about the next batch of orders coming through. Thank you. Operator: Our next question comes from [indiscernible] with CICC. Unknown Analyst: This is [indiscernible] from CICC. Congratulations on the strong results and impressive [indiscernible] performance. My question is about your guidance. Could you please update us on your guidance for both the third quarter and full year 2026? Are there any updates to your 3 million to 3.5 million unit lidar shipment guidance for this year? Peng Fan: Thanks for the question. For Q3, we expect that the total revenue of between RMB 1.1 billion to RMB 1.15 billion with lidar shipments around 800,000 to 850,000 units. SGI should be high 8 digits of that revenue in Q3. Actuation is ramping fast and is approaching 10,000 modules of monthly production capacity soon. Most excitingly, Q3 is expected to be the quarter where revenue from outside ADAS lidar gets close to or even more than half of total revenue. That's another clear step into our role as infrastructure for robotics and physical AI. That acceleration also reinforces our confidence for the full year. We have raised SGI expectations, but lidar remains the core. We are reiterating 2026 shipments guidance of 3 million to 3.5 million lidar units. We shipped about 1.1 million units in the first half, almost double last year. And here is what people sometimes miss. Our ADAS business follows auto seasonality. Second half is usually much stronger. Last year, roughly 2/3 of our full year volume came in second half. So this second half ramp is normal for our business. And on top of that, there are 3 things driving lidar growth. First, penetration. Lidar is not just a story for the new EV players anymore. Traditional OEMs like Geely and Changan, they are putting more lidar into their EV architectures, too. Lidar penetration on EVs was close to 20% in 2025. We think it could get to roughly 30% to 40% this year. And we've been #1 in China's long-range ADAS lidar market for 17 months straight according to Gasgoo. So bigger market, strong position, we like that setup. Second, don't think of penetration as capped at 100%. It can go well beyond 100% because it's no longer one lidar per car. China's mandatory L3 and L4 safety standards came out in August and should take effect in July 2027. Automakers can't wait until then and start drilling holes in the car to add lidar. These sensors have to be designed in and integrated at the factory. That's why we are already seeing multiple lidar setups for broader coverage and also more safety redundancy. Remember how we've always described lidar like airbags. You don't just want 1 airbag in car, and we've already secured multi-lidar design wins with Li Auto, Xiaomi and Changan with 3 to 6 lidars per car. And I don't think this stops at L3. Over time, we are also seeing advanced L2 picking up blind spot lidars. So multi-lidar, this is becoming a major trend in 2026. And once people experience a safer, more capable driving system, it's very hard to go backwards. Third, robotics. Humanoids, lawn mowers, robo vans, robotaxi, demand is picking up across the board. Embodied AI is especially interesting. We are already working with more than 50 leading companies in this space, including Unitree. Morgan Stanley estimate that the robots lidar TAM could be 6x the size of cars. Personally, I think it can be even larger because any robot moving through the real world needs to know where it is, what's around it and what's changing around it, especially when it's interacting with people all the time. Lidar is becoming a basic sense organ for robots, the way eyes are for humans. So put it together, the core lidar business can keep compounding and frankly, remaining our cash cow, while SGI is the new growth driver, that's already taking off, okay? Hope this answers your question. Operator: Our next question comes from Jia Lou with BOCI. Jia Lou: This is Jia Lou from BOCI. My question is regarding robotics lidar. Any upside or downside risk to our robotics lidar shipment guidance for 2026? In terms of downstream market, beyond lawn mowers, robo vans and 2-wheelers, where is the penetration accelerating? And does the FCC's recent action on foreign-produced robotics devices affect our robotics business? Peng Fan: Okay. We are still expecting the full year outlook for our robotics lidar over 500,000 units. Last year, it was around 240,000. We are on track for the delivery. Q2 robotics lidar shipments almost tripled year-over-year. Demand is broad, not concentrated in one niche. On the FCC piece, we don't see a material direct impact at this point. Most of our robotics lidar volume this year is robotic lawn mowers. Those customers are largely Chinese manufacturers focused on Europe as their key overseas markets. U.S. lawn mower penetration is still relatively low. We are watching the rules closely and we will stay fully compliant. But as of today, it doesn't change our shipment outlook. More importantly, lawn mowers are just one wedge of a much bigger opportunity. The core view is simple. Any robot moving through the physical world has to do what humans do, see, understand and act in real time. Lidar is becoming a fundamental sense organ for robots. A robot without reliable 3D perception is like walking through an unfamiliar room with your eyes closed. We already hold leading positions across humanoids and quadrupeds, robotaxi, robo vans and robotic lawn mowers per GGII, Yole and Frost & Sullivan. Humanoid demand is especially strong. We are working with more than 50 embodied AI companies worldwide, including Unitree. JT128 is quickly becoming a go-to lidar for humanoids and quadrupeds, navigation, obstacle avoidance, safe interactions with people and objects. Warehouses and logistics are moving fast, too. In some high-performance setups, a single machine can carry as many as 15 JT128 units for full coverage. JT128 also carries a higher ASP than the JT16 used in lawn mowers, harder performance requirements, more lidar content per machine. So robotic lidar isn't just an add-on to auto. Over time, it can get substantially larger, more environments, potentially far more machines. We like to say lidar is the shovel in the physical AI gold rush. We don't need to call which category scales first, humanoids, warehouse robots, robotaxi, lawn mowers or something else. Whichever wins, reliable spatial perception is essential. Hesai is set up to ride that growth across the whole ecosystem. Operator: Your next question comes from Jessie Lo with Bank of America Securities. Yu Jie Lo: This is Jessie from Bank of America. I just have a quick one around our key customer, Xiaomi. Xiaomi has included RoboSense to its lidar supplier on the latest model launch. So how do you see Hesai's share developing in Xiaomi's future models? And more broadly, as more suppliers enter into our customer supply chain, how do you expect the competition pricing pressure and also the supplier shares to evolve? Peng Fan: Okay. First, Xiaomi moving further into multi-lidar is actually encouraging for the whole industry. Even on L2, they are adding a real lidar where there used to be 0. That tells you something. Automakers and consumers are recognizing what lidar is worth. Our long-term view hasn't changed. Every intelligent vehicle eventually carries at least 1 lidar. Many will carry several for coverage and redundancy. So it isn't a fight over 1 lidar per car. As lidars per vehicle rise, the opportunity can become several times larger. The pie itself is turning out to be much, much bigger than people thought. On competition, market sourcing is normal in auto industry, especially as programs scale. We don't comment on allocation for individual future models. That may shift sometimes with performance, cost, capacity and platform needs. Better to let the data speak. According to Gasgoo, Hesai has been #1 in China's long-range ADAS lidar market for 17 straight months with roughly 40% to 50% share. And we've done that while keeping relatively healthy pricing and margins. As the leader, our goal isn't 100% share at any cost. A disruptive price war is the worst outcome for everyone. It starves technology, quality and safety. We'd rather stay clearly ahead on tech, deliver more value to customers and earn a fair return on that value. That confidence comes from structural advantages, proprietary ASICs, deep system engineering, large-scale automated manufacturing, a broad product portfolio, automotive-grade reliability and years of mass production. Those let us stay competitive even when we are not the cheapest option. Customers aren't buying a cute little box on the roof. They are buying safety and reliability for the moment that camera fails. In your cars, lidar is the airbag, as we always said. We are also investing in the next cycle, Picasso, our full color ultrasensitive 6D SPAD-SoC integrates depth and RGB color at the chip level. To the best of our knowledge, Hesai is currently the only company in China taking native chip level full color LiDAR into mass production, on track for the second half of 2026. That's the kind of innovation that let us compete on more than price. Over time, the lidar versus camera debate fades. They become one integrated system. The only question that remains is when the car drives itself, is my family safe enough? People also obsess over shipments or revenue share but miss profit share. Just look at Apple in smartphones, its share of industry profit has been fairly high -- far higher than its share of unit shipments. That wasn't a price war. It was technology, product, brand and a differentiated value. We think about Hesai the same way. We'll keep working to hold our leading position like 40, 50-ish, but leadership isn't just shipping the most units. It's capturing a leading share of the industry economic value, protecting healthy gross margins, reinvesting in innovation and creating long-term values for users and for society. Operator: Our next question comes from Aaron Wang with Jefferies. Weijie Wang: This is Aaron from Jefferies. My question is on the lidar ASP and margin side. Given the ongoing industry-wide pricing pressure and also the competition from peers, could management elaborate more on the ASP trend for LiDAR projects over the next few quarters? And also, how should we think about our margin profile going forward? Peng Fan: Okay. We are positive on the resilience of gross margin. Full year 2026 outlook is unchanged, close to 40%, and we expect to keep a healthy margin profile going forward. First, look past the headline blended ASP. The L3 shift changed the math from lidar's price to total lidar content per vehicle, and an L2 car typically carried large long-range lidar. Now we are already seeing L2 add real blind spot units, 2 lidars. Entry-level L3 might be 1 ATX plus 2 FTX blind spot lidars. More advanced setups with ETX and extra FTX can push total content to roughly USD 500 to USD 1,000 per vehicle. So the lidar value we deliver per car is rising, and that's showing up in vehicles launching this year. Gross margin isn't just about price, it's price minus cost. Our price, we're already #1 in the market share, so we have no interest in giving up pricing just to chase more share. We compete on brand, technology and quality. On cost, years of in-house ASICs, system-level integration, automation and scale have let us keep bringing costs down. Net of that, we target a relatively stable ADAS margin profile. The mix helps the group, too. Robotics lidar and overseas business generally run higher margins than domestic ADAS. Robotics lidars almost tripled year-over-year in Q2, and the global business should keep expanding. As those scale, they remain important support for healthy group margins. SGI also started contributing revenue in Q2, too early to comment on near-term financials while products are still ramping. But long term, we expect SGI margins above 40%. Kosmo, especially with cloud services in the mix should carry a structurally higher margin than pure hardware and become increasingly accretive to the group. Operator: There are no further phone questions at this time. I'll now hand the call back over to Yuanting Shi for closing remarks. Yuanting Shi: Thank you once again for joining us today. If you have further questions, please feel free to contact our IR team. This concludes today's call, and we look forward to speaking to you again next quarter. Thank you, and goodbye. Operator: That does conclude our conference for today. Thank you for participating. You may now disconnect. Before you buy stock in Hesai Group, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Hesai Group wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $429,223!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,317,883!* Now, it’s worth noting Stock Advisor’s total average return is 965% — a market-crushing outperformance compared to 212% for the S&P 500. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors. See the 10 stocks » *Stock Advisor returns as of August 25, 2026. This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. Hesai (HSAI) Q2 2026 Earnings Call Transcript was originally published by The Motley Fool

Download the Complete Report Here Key Takeaways: 1H26 marks an important step in ENRD’s transition from contracted demand toward scaled deployment, with signed capacity beginning to convert into a materially faster revenue growth profile in 2H26. Revenue increased 26% y/y on a constant-currency basis to approximately $27 million from $21 million in 1H25, driven by additional capacity with existing customers and new deployments across the network. Reported revenue increased ~22% y/y to SEK263.5 million from SEK216.5 million, with transport services contributing SEK246.6 million versus SEK201.0 million and rental revenue increasing to SEK16.9 million from SEK15.5 million. The forward setup is considerably stronger than the 1H26 growth rate, with 2H26 constant-currency revenue guided to $39-$42 million, up 60%-73% y/y from $24 million in 2H25. The step-up is expected to be driven primarily by the Amazon ramp, additional U.S. and European deployments and the initial Tesla Semi rollout, suggesting the principal near-term growth constraint is shifting toward deployment capacity and execution as signed demand moves into operations. A meaningful portion of near-term growth has already moved from the JBP funnel into contracted business awaiting deployment. ENRD continues to disclose more than $800 million of potential ARR through Joint Business Plans, while the customer base has expanded to 32 customers across seven countries and cumulative operating activity now exceeds 560,000 shipments. The $800 million+ JBP figure remains non-binding, but management provided an important distinction around the December revenue ramp: the absolute majority of capacity supporting the targeted $85-$95 million December 2026 annualized revenue run-rate has already moved from JBP into signed contracts, leaving vehicle deployment and capacity activation as the primary remaining steps before revenue recognition. We believe this is an important progression because the near-term execution focus is now increasingly on converting contracted capacity into deployed revenue at higher utilization and improving margins, rather than proving underlying customer demand. Amazon is becoming both a meaningful deployment driver and a strong validation point for ENRD’s enterprise customer-acquisition model. Following an initial pilot, ENRD secured a deployment of 75 electric heavy-duty trucks across five U.S. locations in Amazon’s middle-mile network, with the fleet integrated into Amazon Relay and execution managed through Saga AI; initial deployments are already live and the majority of the first wave is expected to be operational before year end 2026. The commercial organization has also been scaled over the last 6 to 8 months, contributing to an approximately 3x increase in the sales pipeline, while deployment lead times have improved over the past 12-18 months as vehicle availability, charging infrastructure and ENRD’s operating footprint expanded. For a high-touch enterprise model with relatively long initial sales cycles, reference deployments such as Amazon should help shorten customer diligence and support expansion across additional lanes and geographies. The recently announced 500-truck Tesla Semi program materially changes ENRD’s fleet scaling equation by adding significant deployment capacity while separating a substantial portion of fleet growth from equity funding. ENRD currently operates approximately 250 vehicles and expects Amazon, other signed deployments and the initial Tesla rollout to take the fleet to just under 400 by year end 2026, implying roughly 60% growth from the current base. The 500 Tesla Semi program alone would triple the current fleet toward approximately 750 vehicles, with the majority targeted to be operational before year end 2027. The program should also support higher revenue per truck from the current roughly $300,000 annual level, with the Semi’s specifications opening additional lanes and distances and management expecting a positive contribution-margin impact as utilization increases. The vehicles will be financed through third-party solutions rather than equity, allowing ENRD to match asset-backed leverage directly against revenue-generating capacity and accelerate conversion of its $800 million+ JBP opportunity into operating revenue without incremental equity dilution. Growing network scale is building the conditions for improved FCaaS economics while creating the data and operating density required for autonomous commercialization. ENRD has now completed more than 18.5 million electric miles and 560,000 shipments across 32 customers in seven countries, providing Saga AI with a larger data set to optimize routing, charging and vehicle utilization. That same network has generated more than 5,400 driverless hours in contracted customer operations, up 64% over the preceding six months across six autonomous deployments, while management estimates that approximately 80% of customer freight demand already captured on the platform is suitable for automation over the medium term. This creates a differentiated commercialization pathway: ENRD can progressively introduce autonomous capacity into freight flows it already operates and understands rather than building a separate autonomous-demand base, while Saga and Einride Driver have begun generating SaaS revenue following the late-2025 launch of the vehicle-agnostic offering, providing an early proof point for a more capital-light technology revenue model. Contribution economics have stabilized at the transport level, with the next margin inflection dependent on higher utilization and fixed-cost absorption as fleet scale increases. Contribution margin declined from 29.2% in 1H25 to 20.7% in 2H25, remained at 20.7% in 1H26 and is guided to improve to 21%-23% in 2H26 as utilization increases, with management targeting approximately 35% over the longer term. Reported cost of sales was SEK395.4 million against SEK263.5 million of revenue, producing a gross loss of approximately SEK131.9 million and gross margin near negative 50%, versus roughly negative 40% in 1H25, with approximately SEK95 million of depreciation and amortization embedded in cost of sales. The key margin lever is therefore scaling revenue and utilization faster than vehicle and infrastructure costs, with the approaching 400-vehicle year-end fleet expected to provide greater fixed-cost absorption and support operating leverage. Investment in autonomy, technology and commercial capacity is keeping adjusted EBITDA negative despite the stronger revenue trajectory. Adjusted EBITDA widened from negative $21.0 million in 1H25 to negative $27.9 million in 2H25 and negative $34.6 million in 1H26, with 2H26 guided to negative $35 million – $37 million as ENRD continues funding autonomous development, Saga capabilities and commercial infrastructure. Constant-currency R&D spend increased ~57% y/y to $20.4 million from $13.0 million, while reported R&D rose to SEK205.9 million from SEK131.2 million and selling expense increased to SEK46.6 million from SEK35.2 million. Net loss widened to SEK1.12 billion from SEK887.4 million, although comparability was affected by SEK636 million of non-cash recapitalization expense, SEK245 million of listing-related share compensation and SEK203 million of transaction advisory costs, partly offset by a SEK582 million warrant-remeasurement gain. The 2H26 setup therefore centers on whether 60%-73% revenue growth begins to improve fixed-cost absorption while ENRD sustains elevated investment in autonomy and platform development. DAF and defense expand the commercialization pathways for Einride Driver beyond ENRD-owned autonomous hardware, reinforcing the vehicle-agnostic licensing model. The DAF partnership will integrate Einride Driver onto an established PACCAR vehicle platform, with interface work during 2026 followed by integration and commissioning in 2027 before progressing toward more scaled deployments, reducing reliance on ENRD’s proprietary cab-less trucks as autonomy commercializes. In parallel, ENRD established a dedicated defense unit following pilot contracts with NATO-allied organizations and partnered with Centinus to combine autonomous logistics with real-time threat detection and counter-UAS monitoring. General (Ret.) Keith B. Alexander, who joined ENRD’s Board earlier this year, is expected to help guide expansion across Europe and the U.S., adding defense and cybersecurity expertise to the commercialization effort. Neither channel is yet a material financial contributor, but both broaden the potential market for a vehicle-agnostic Einride Driver while supporting a more capital-light technology revenue model that does not require ENRD to own the underlying fleet. Flipturn expands Saga into charging and energy management, adding a software-led layer that can improve deployment efficiency while addressing a practical bottleneck to electric-fleet scale. The acquisition adds more than 5,000 live charging ports and over 250 MW of charging capacity under management, alongside charge-port management, energy orchestration and connectivity to third-party charging networks. Aggregating charging demand should improve access to external infrastructure and charging economics while reducing site-readiness friction as ENRD expands across more customer locations. The transaction was primarily equity funded, with SEK373.5 million of base consideration including approximately 4.41 million ENRD ADSs and only ~SEK2.4 million of cash, while up to another 3.72 million ADSs are tied to contracted ARR and product milestones through 2028. The strategic payoff will depend on whether Flipturn converts its charging footprint into incremental software revenue, lower deployment friction and better charging economics, sufficient to justify the associated equity consideration. Operating cash requirements increased with the investment and deployment ramp, making working-capital efficiency increasingly important to funding the next phase of scale. Net cash used in operating activities increased ~88% y/y to SEK536.7 million from SEK285.2 million, reflecting the heavier investment burden ahead of planned fleet and technology deployments. Working capital provided a meaningful partial offset, with SEK143.1 million in inflows supported by higher trade payables and accrued expenses as supplier activity increased alongside deployment volumes. Trade receivables increased 32% from year end 2025 to SEK27.7 million and accrued income more than doubled to SEK61.3 million from SEK29.5 million, while trade and other payables increased ~55% to SEK411.0 million and accrued expenses rose to SEK160.7 million from SEK146.8 million. As ENRD moves into a faster deployment phase, the ability to convert revenue into cash efficiently and manage supplier and vehicle-payment timing should become increasingly important to limiting incremental external funding needs as the fleet scales. The public-market transaction materially strengthened near-term liquidity, providing a larger capital base to support the current deployment ramp and technology roadmap. Cash increased to approximately SEK747.6 million, or $77 million, at June 30 from SEK278.8 million at YE25 and SEK112.8 million a year earlier, supported primarily by approximately $113 million of PIPE proceeds, although only ~$3.3 million remained in the SPAC trust following redemptions and transaction fees and expenses totaled approximately $34 million. With 1H operating cash use of SEK536.7 million and investing cash use of SEK16.3 million, ENRD will still require access to external funding as the business scales, but management’s strategy of financing revenue-generating fleet assets separately should reduce the amount of corporate capital required for vehicle growth and preserve more balance-sheet capacity for Saga, autonomy and commercial expansion. Capital allocation is increasingly centered on capital-efficient fleet scaling, with corporate capital reserved for technology and commercial expansion while vehicle growth is funded through non-dilutive asset-backed structures. Loans and borrowings excluding leases totaled approximately SEK49.3 million at June 30, while lease liabilities were ~SEK732.8 million and the prior SEK207.7 million convertible debenture had been eliminated. ENRD entered approximately SEK33.9 million of installment-financing arrangements for electric-truck purchases during 1H26 and subsequently added a $25 million U.S. equipment facility in August, with individual drawdowns carrying 42-month terms and an effective interest rate of approximately 14%. Management expects this asset-backed approach to extend to larger fleet programs, including the Tesla Semis, with vehicles financed against the underlying revenue-generating assets rather than through new equity, implying zero incremental equity dilution from those vehicle deployments. The strategy allows corporate capital to remain directed toward Saga AI, Einride Driver, R&D and commercial expansion, while making vehicle utilization, contribution margin and returns relative to financing costs increasingly important to determining whether fleet growth remains value-accretive. The December 2026 exit rate provides the clearest near-term marker of ENRD’s scale-up, with annualized revenue targeted at $85 million to $95 million as contracted capacity moves into deployment. For 2H26, constant-currency revenue is guided to $39-$42 million, up 60% to 73% y/y, contribution margin to 21%-23% and adjusted EBITDA to negative $35 million to $37 million. Combined with the $27 million 1H actual, this implies approximately $66 million-$69 million of 2026 constant-currency revenue and negative $70 million to $72 million of adjusted EBITDA based on disclosed results and guidance. The December run-rate is expected to be supported by a fleet just below 400 vehicles versus approximately 250 today, with the majority of the capacity underpinning that revenue level already contracted. ENRD plans to issue a business update with selected figures in the fall before moving to quarterly reporting in 2027. Beyond 2026, the operating roadmap increasingly centers on scaling the four engines required to reach management’s 2028 cash flow breakeven target. Management estimates that approximately 1,500-2,000 deployed vehicles are required to reach breakeven, while existing JBPs represent roughly 1.4x-1.8x the freight volume necessary to support that fleet. With the majority of the 500 Tesla Semis targeted to be operational before year end 2027, the next execution steps center on converting additional JBPs into signed capacity, adding deployments through Tesla and other OEMs, and scaling technology licensing alongside FCaaS. The demand base therefore appears sufficient to support the targeted operating footprint, making deployment cadence, capital efficiency and margin conversion the principal milestones into 2027 and 2028. Together, capital-efficient fleet expansion, contracted-demand conversion, continued autonomy and R&D investment, and increasing Saga AI and Einride Driver monetization form the four strategic engines supporting the path to cash flow breakeven. Disclaimer: Exec Edge does not publish proprietary estimates, ratings, price targets, or investment recommendations. The valuation discussion below is illustrative only and is based on company filings, management commentary, and third-party data and estimates. It does not constitute a recommendation, price target, rating, or prediction of future pricing. Valuation has reset materially below the original transaction level despite improving commercial visibility, leaving execution against the current deployment ramp as the principal potential re-rating catalyst. As of the 8/20 close, ENRD carries a pro forma market capitalization of ~$884 million and an EV of ~$812 million, approximately 46% below the ~$1.51 billion EV implied by the SPAC transaction. This reset has occurred despite 1H26 constant-currency revenue growth of 26%, a 60%-73% 2H26 growth outlook, and substantially greater deployment visibility following the Amazon and Tesla Semi programs. Using the midpoint of management’s $85-$95 million December annualized revenue run-rate as a forward revenue proxy, ENRD trades at approximately 9.0x EV/Sales, providing a materially lower valuation entry point despite a substantially larger and more visible operating base. ENRD screens at a substantial discount to direct trucking-autonomy peers while trading at only a modest premium to the broader autonomous-vehicle group. Aurora Innovation and Kodiak AI trade at 156.4x and 54.3x NTM EV/Sales, respectively, producing a direct trucking-autonomy average of 105.4x compared with ENRD’s 9.0x forward revenue multiple based on management’s December annualized run-rate. The direct peer multiples remain unusually high because both businesses are still early in their commercial revenue ramps; however, the dispersion illustrates the substantial premium public markets assign to autonomous-trucking commercialization potential. The broader AV and sensing peer group trades at an average of approximately 6.9x NTM EV/Sales, placing ENRD at a more measured ~30% premium. That premium appears supportable given ENRD’s existing commercial footprint of 32 customers across seven countries, approximately 250 deployed vehicles, more than 18.5 million electric miles and 5,400+ driverless hours, combined with an integrated FCaaS, Saga AI and autonomous-software model that provides both current freight revenue and longer-term technology monetization. The valuation increasingly centers on ENRD conversion of contracted demand into revenue at improving margins and lower capital intensity. Delivery of the $39-$42 million 2H26 revenue outlook, a fleet approaching 400 vehicles by year end 2026 and contribution margin improving from 20.7% to the guided 21%-23% would provide tangible evidence that the current deployment ramp is translating into operating leverage. Beyond 2026, execution of the 500 Tesla Semi program, continued conversion of the $800 million+ JBP opportunity and increasing Saga AI and Einride Driver monetization could support a progressively higher-margin revenue mix, while third-party asset-backed financing provides a pathway to expand revenue-generating fleet capacity with zero incremental equity dilution from those vehicle deployments. Conversely, slower deployment conversion, limited gross-margin improvement or weaker capital efficiency would justify maintaining a discount despite the scale of contracted and prospective demand. At 9.0x EV/Sales on December run-rate revenue, the potential re-rating case is therefore increasingly tied to demonstrating that higher fleet scale can convert into faster revenue growth, improving margins and lower equity capital intensity, rather than further proof of underlying customer demand. Read Exec Edge’s Initiation on ENRD Here Subscribe to our Weekly Newsletter to Receive All Research Contact: Executives-Edge.com [email protected] The post Einride AB Reports Growth Acceleration & Fleet Scale Moves Towards 2028 – Quarterly Update Report appeared first on ExecEdge.

Interested in Hesai Group Sponsored ADR? Here are five stocks we like better. Hesai’s Q2 results strengthened its profitability profile: Revenue increased 22% year over year to RMB 861 million, gross margin reached 40%, and GAAP net income rose 60% to RMB 71 million, marking a fifth consecutive quarter of GAAP profitability. Core LiDAR demand remained strong: Shipments climbed nearly 80% to more than 628,000 units, supported by growth in both ADAS and robotics, while Hesai announced design wins with Great Wall Motor and Volkswagen-related brands. New robotics businesses are beginning to scale: Strategic growth initiatives generated RMB 45 million in Q2 revenue, prompting Hesai to raise its 2026 SGI outlook to RMB 200 million–RMB 300 million; management expects the segment to reach roughly US$100 million in revenue and break even in 2027. 3 Stocks That Could Benefit as the Robotaxi Race Heats Up Hesai Group (NASDAQ:HSAI) reported second-quarter 2026 revenue growth and a fifth consecutive quarter of GAAP profitability, while outlining an expanded strategy centered on LiDAR, spatial intelligence and robotic actuation modules. Total net revenue rose approximately 22% year over year to RMB 861 million, or US$127 million, according to CFO Andrew Fan. Gross margin was 40%, while GAAP net income increased 60% from a year earlier to RMB 71 million, or US$10 million. Non-GAAP net income was RMB 101 million, or US$15 million. → AMG’s Alternatives Boom Powers Record Growth SpaceX Gets the Attention, But These 4 Stocks Could Get the Returns The company said it has begun reporting results through two segments: its core LiDAR business and strategic growth initiatives, or SGI. CEO David Li described the company’s broader vision as a platform for robotics and physical AI across three layers: helping machines “see” through LiDAR, “understand” through the COSMO spatial-intelligence platform, and “act” through robotic actuation modules. Core LiDAR revenue totaled RMB 816 million, or US$120 million, and the segment generated operating profit of RMB 66 million, Fan said. Total LiDAR shipments exceeded 628,000 units, up nearly 80% year over year. ADAS LiDAR shipments rose about 60% to more than 485,000 units. Robotics LiDAR shipments increased about 193% to more than 142,000 units. Hesai said it has worked with more than 50 embodied-AI companies globally, including Unitree, Robiant, Galbot, Galaxea and Dexmo. → Microsoft's Maia 300 Chip Targets NVIDIA's AI Dominance Li said the company won a design win with Great Wall Motor for mass-production programs using its ETX ultra-long-range LiDAR, with start of production expected in late 2026. He also cited multi-LiDAR programs with Changan Automobile and other OEMs, as well as mass production of Li Auto’s L8 and L9 models, which each use four Hesai LiDAR units. Internationally, Li said Hesai secured a design win with Volkswagen covering multiple models from the automaker’s China joint-venture brands, following its work with Mercedes-Benz. He also cited an expanded collaboration with GAC Toyota. → The Metals Company’s Big Bet Now Comes Down to a License According to Li, third-party data provider Gasgoo showed Hesai held 44% of China’s long-range ADAS LiDAR market in June, extending its lead in that category to 17 consecutive months. Fan said the company expects LiDAR penetration on electric vehicles to continue rising and sees growing use of multiple sensors per vehicle for coverage and redundancy. SGI generated its first quarterly revenue contribution in the second quarter, producing RMB 45 million, or US$7 million, driven by early demand for robotic actuation modules. The segment posted an operating loss of RMB 64 million as the company invested in development, commercialization and manufacturing capacity for actuation products and COSMO. Management raised its full-year 2026 SGI revenue outlook to RMB 200 million to RMB 300 million, from previous guidance of RMB 100 million. Fan said the company expects SGI to generate about US$100 million in revenue in 2027 and reach break-even that year. Li said robotic actuation modules will account for the majority of SGI revenue in 2026, while COSMO is expected to make a smaller, low-eight-digit RMB contribution because its commercialization is beginning later in the year. He said COSMO’s future revenue mix could increasingly include cloud processing, subscriptions and licensing of 3D spatial assets. COSMO combines an AI spatial camera, algorithms, 3D assets and cloud services to capture and reconstruct physical environments. Li said prototypes shipped in July, and the company received initial orders within seven days, including from humanoid robotics company Galbot. COSMO is expected to begin contributing revenue in the third quarter. The company said more than 200 prospective partners have approached it since COSMO’s April preview, spanning robotics, film, gaming, tourism, luxury and advertising applications. Li did not disclose customer names or order values for the platform. Hesai said it began generating revenue from robotic actuation modules in the second quarter and had cumulatively shipped more than 10,000 modules by quarter-end. Its dedicated production line is operating, with the company ramping toward about 10,000 modules of monthly capacity in the near term. Management expects six-digit module volumes in 2027. Li said the company is supplying modules to Sharpa, a humanoid robotics company he co-founded. Hesai expects Sharpa to begin a commercial deployment at a Dairy Queen store in Shanghai in August, where a humanoid robot is expected to prepare Blizzard treats autonomously. The company is seeking shareholder approval to raise the annual cap for product supply transactions with Sharpa to RMB 300 million from RMB 100 million. Li said most of the anticipated transactions this year would involve actuation modules. Management said full-body actuation modules for applications including shoulder and wrist joints are expected to reach start of production in the second half of 2026. Li said the modules have torque and power density roughly three times that of leading currently available products, are 37% smaller and have transmission efficiency above 95%, with performance validated through 2 million operating cycles. For the third quarter, Fan forecast total revenue of RMB 1.1 billion to RMB 1.15 billion and LiDAR shipments of roughly 800,000 to 850,000 units. SGI is expected to account for a high-eight-digit RMB portion of third-quarter revenue. Hesai reiterated its full-year 2026 LiDAR shipment forecast of 3 million to 3.5 million units. It shipped about 1.1 million LiDAR units in the first half, Fan said, adding that the company expects a stronger second half due to automotive industry seasonality. Fan also reaffirmed the company’s expectation for full-year gross margin near 40%. He said robotics LiDAR and international business generally carry higher margins than domestic ADAS products, while management expects long-term SGI margins of about 40%. COSMO, with cloud services as part of its model, is expected to carry structurally higher margins than hardware-only offerings. Hesai Group is a technology company specializing in the development and production of advanced LiDAR (Light Detection and Ranging) sensors and perception software platforms for autonomous vehicles, robotics, industrial automation and mapping applications. The company’s core business centers on delivering high-performance, high-reliability LiDAR solutions designed to enable precise three-dimensional sensing and real-time environment perception. Hesai’s product lineup spans mechanical rotating LiDAR units, solid-state and MEMS-based sensors, as well as integrated software stacks for object detection, tracking and data fusion. Founded in 2014 by a team of laser sensing and robotics researchers, Hesai built its reputation on improving range, resolution and reliability of LiDAR systems while driving down cost and size. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "Hesai Group Q2 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for August 2026.

This article first appeared on GuruFocus. Total Net Revenues: RMB861 million (USD127 million), up approximately 22% year-over-year, marking the ninth consecutive quarter of growth. Gross Margin: Remained healthy at 40%. GAAP Net Income: RMB71 million (USD10 million), up 60% year-over-year, marking the fifth consecutive quarter of GAAP profitability. Non-GAAP Net Income: RMB101 million (USD15 million). Lidar Revenues (Core Business): RMB816 million (USD120 million), with operating profits of RMB66 million (USD10 million). Total Lidar Shipments: Over 628,000 units, up close to 80% year-over-year. ADAS Lidar Shipments: Increased approximately 60% to over 485,000 units. Robotics Lidar Shipments: Grew approximately 193% to over 142,000 units. SGI Revenues (Strategic Growth Initiatives): RMB45 million (USD7 million), the segment's first revenue contribution, driven by robotic actuation modules. SGI Operating Loss: RMB64 million, reflecting investments in product development and commercialization. Operating Expenses: Sales and marketing expenses were RMB50 million; general and administrative expenses were RMB67 million; research and development expenses were RMB231 million. Full Year 2026 SGI Revenue Guidance: Raised from RMB100 million to a range of RMB200 million to RMB300 million. Warning! GuruFocus has detected 5 Warning Signs with HSAI. Is HSAI fairly valued? Test your thesis with our free DCF calculator. Release Date: August 18, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Hesai Group (NASDAQ:HSAI) reported strong Q2 2026 results with total net revenues of RMB861 million, up 22% year-over-year, and GAAP net income of RMB71 million, marking the fifth consecutive quarter of profitability. The company is expanding beyond lidar into a full-stack robotics infrastructure platform with three layers (see, understand, act), and its Strategic Growth Initiatives (SGI) segment, including robotic actuation modules and Kosmo, is gaining early commercial traction, with SGI revenue guidance raised to RMB200-300 million for 2026. Hesai Group (NASDAQ:HSAI) continues to lead the ADAS lidar market, holding a 44% share in China's long-range ADAS lidar market in June 2026 and securing new design wins with major automakers like Great Wall Motor, Volkswagen, and GAC Toyota. Robotics lidar shipments nearly tripled year-over-year in Q2 2026, driven by strong demand from humanoid and quadruped robots, with expectations for another 2-3x increase in full-year 2026 shipments. The company's new products, including the Picasso SoC (full-color 6D lidar) and Kosmo spatial intelligence platform, are advancing rapidly, with Kosmo already securing initial orders within seven days of prototype delivery and expected to contribute revenue in Q3 2026. Hesai Group (NASDAQ:HSAI) faces increasing competition in the ADAS lidar market, with customers like Xiaomi adding other suppliers (e.g., RoboSense) for certain models, which could pressure market share and pricing. The SGI segment, while growing, is still loss-making, with an operating loss of RMB64 million in Q2 2026, and the company expects it to only break even in 2027, indicating ongoing investment needs. The company's gross margin remained at 40% in Q2 2026, and management expects it to stay around this level for the full year, suggesting limited near-term margin expansion despite cost reduction efforts. There are potential regulatory risks, such as the FCC's recent actions on foreign-produced robotics devices, which could impact the robotics lidar business, although management currently sees no material direct impact. The company's reliance on a few key customers, particularly Sharpa for actuation modules, poses concentration risk, and the proposed increase in the annual cap for transactions with Sharpa to RMB300 million highlights this dependency. Q: What drove the increase in SGI revenue guidance, and how should we think about the revenue mix between robotic actuation modules and Kosmo in SGI?A: CFO Andrew Fan stated that the full-year 2026 SGI revenue guidance was raised from RMB100 million to RMB200-300 million due to commercial demand and tech validation coming in well ahead of original models. For 2027, SGI is expected to reach roughly USD100 million (about RMB700 million) and achieve breakeven. The main driver this year is robotic actuation, which started generating revenue in Q2, with demand from Sharpa running ahead of expectations. Kosmo is on track to contribute revenue in Q3, with initial contributions expected to be in the low eight digits. Directionally, actuation will be the majority of SGI revenue in 2026, but the mix should shift in 2027 as Kosmo matures into higher-margin recurring cloud services and 3D spatial asset licensing. Q: Can you provide more color on Hesai's humanoid robot actuation modules, their financial profile, and whether you are shipping to customers beyond Sharpa?A: CEO David Li explained that actuation can be more than half a robot's BOM, with one humanoid potentially needing over 100 modules, leading to long-term demand approaching a trillion units. The margin profile is currently around 40%. He confirmed the market is ready, as humanoids are hitting volume and real-world deployment starting this year, and Hesai has the engineering capability built on a decade of precision electromechanical systems. The strategy is to validate the architecture through the hardest application (dexterous hands) before extending to full-body modules, with SOP for shoulder and wrist joints expected in the second half of 2026. Q: Could you brief us on the business model of Kosmo, its existing and potential customers, and the delivery schedule?A: CEO David Li described Kosmo as a spatial intelligence platform that integrates an AI spatial camera, algorithms, 3D assets, and cloud services. Since its April preview, over 200 prospective partners have reached out across robotics, film, gaming, tourism, and luxury sectors. Prototypes shipped in July, and initial orders came within seven days. Early demand is clustering in two areas: robotics (for high-quality training inputs to unlock scaling) and media/digital content (for immersive, reusable 3D assets). The business model is a flywheel: more devices lead to a deeper asset library, which unlocks more applications and drives recurring revenue through cloud usage and asset licensing. Q: Could you update us on your guidance for Q3 and full year 2026, and are there any updates to the 3 million to 3.5 million unit lidar shipment guidance?A: CFO Andrew Fan provided Q3 guidance of total revenue between RMB1.1 billion to RMB1.15 billion, with lidar shipments around 800,000 to 850,000 units. SGI should contribute high eight digits of that revenue. He reiterated the full-year 2026 lidar shipment guidance of 3 million to 3.5 million units, noting that the second half is typically much stronger due to auto seasonality. Growth drivers include increasing lidar penetration on EVs (from ~20% in 2025 to 30-40% this year), the trend toward multi-lidar setups (3-6 lidars per car) driven by mandatory L3/L4 safety standards in China, and accelerating robotics demand. Q: What are the upside or downside risks to the robotics lidar shipment guidance for 2026, and does the FCC's recent action on foreign-produced robotics devices affect the business?A: CFO Andrew Fan confirmed the full-year outlook for robotics lidar remains over 500,000 units, up from around 240,000 last year. He stated there is no material direct impact from the FCC action at this point, as most robotics lidar volume this year is for robotic lawnmowers, with customers largely focused on Europe. The company is watching the rules closely and will stay fully compliant. Beyond lawnmowers, demand is broad across humanoids, quadrupeds, robo-taxi, robo-vans, and warehouse logistics, with the JT128 becoming a go-to lidar for humanoids and carrying a higher ASP than the JT16 used in lawnmowers. Q: How do you see Hesai's share developing in Xiaomi's future models, and how do you expect competition and pricing pressure to evolve as more suppliers enter customer supply chains?A: CFO Andrew Fan viewed Xiaomi's move to multi-lidar as encouraging for the industry, noting that the pie is becoming much bigger than people thought. He declined to comment on specific allocation for individual models but highlighted that Hesai has been number one in China's long-range ADAS lidar market for 17 straight months with roughly 40-50% share. He emphasized that Hesai's goal is not 100% share at any cost, preferring to compete on technology, brand, and quality rather than engaging in a destructive price war. He pointed to structural advantages like proprietary ASICs, large-scale automated manufacturing, and the upcoming Picasso full-color 6D SPAD SoC as differentiators. Q: Given ongoing industry-wide pricing pressure, could you elaborate on the ASP trend for lidar products and the margin profile going forward?A: CFO Andrew Fan expressed confidence in gross margin resilience, reiterating the full-year 2026 outlook of close to 40%. He explained that the L3 shift changes the math from one lidar's price to total lidar content per vehicle, with advanced setups pushing total content to roughly USD500 to USD1,000 per vehicle. He noted that gross margin isn't just about price but price minus costs, and Hesai's in-house ASICs, automation, and scale have kept costs down. The mix also helps, as robotics lidar and overseas business generally run higher margins than domestic ADAS. Long-term, SGI margins are expected to be around 40%, with Kosmo's cloud services carrying structurally higher margins. Q: Can you share more details regarding potential collaborations with DARPA, NVIDIA, and Google Gemini, and what is the long-term revenue potential for the actuation business?A: CEO David Li explained that Hesai is building a full-stack infrastructure platform for robotics and physical AI. He noted that he is also a co-founder of Sharpa, a humanoid robotics company that has gained recognition including adoptions by Gemini Robotics and NVIDIA. Sharpa is expected to begin its first real-world commercial deployment at a Dairy Queen store in Shanghai, which would be For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Quarterly net revenues were RMB860.8 million (US$126.9 million)1 Quarterly lidar shipments were 628,275 units Quarterly net income was RMB70.6 million (US$10.4 million) SHANGHAI, China, Aug. 18, 2026 (GLOBE NEWSWIRE) -- Hesai Group (“Hesai” or the “Company”) (NASDAQ: HSAI; HKEX: 2525), a global tech company and a leader in 3D perception, today announced its unaudited financial results for the three months ended June 30, 2026. Management Remarks “The second quarter of 2026 marked a defining milestone as Hesai has evolved into a full-stack infrastructure platform for Robotics and Physical AI — empowering them to see, understand, and act,” said Dr. Yifan “David” Li, Hesai’s Co-Founder and CEO. “We enable Robotics and Physical AI to see: lidar — our powerful and durable cash engine — is evolving from a ‘must-have’ toward ‘better and more’ in vehicles, the world’s most widely deployed robots. At the same time, demand for the same high-performance, robust, and reliable 3D sensing is rapidly expanding to humanoids and other intelligent machines, driving new orders from Unitree, Robbyant, Galbot, Galaxea, Dexmal, and others. Picasso, our full-color, ultra-sensitive 6D SPAD-SoC, on the other hand, represents a major leap forward in perception technology by enabling a unified 3D understanding of depth, semantics, and how environments evolve over time — delivering true multimodality, which is indispensable for world models and physical AI.” Dr. Li continued, “We enable them to understand: Kosmo, our spatial intelligence platform, transforms the physical world into AI-ready, reusable 3D spatial assets. That gives robots one of the scarcest and most valuable inputs: geometrically accurate, physically grounded digital representations of the physical world, helping bridge the sim-to-real gap and unlock robotics scaling laws. After prototype deliveries in July 2026, we secured orders from a lineup of leading humanoid robotics companies, including Galbot, with initial revenues expected in the third quarter of 2026 as part of Strategic Growth Initiatives (“SGI”). And we enable them to act: high-performance joints represent another of robotics’ toughest bottlenecks. Leveraging our deep precision engineering expertise, we re-engineered actuation modules from first principles to deliver precise control, compact size, high force output, and true backdrivability in one design. Our proprietary modules are already showing commercial traction: modules began generating revenues in the second quarter, and Hesai is now supplying robotic actuation modules to Sharpa, a global frontrunner in AI robotics. Our production line is fully operational, with shipments underway for dexterous hands and full-body joints ramping soon. By empowering them to see, understand and act in a closed loop, Hesai is entering an exciting new chapter of growth — building the foundational infrastructure for a future shaped by Robotics and Physical AI.” “Hesai’s performance in the 2026 second quarter provides strong validation of our next chapter of growth. Our core lidar business continued to deliver profitable scale and strong cash generation, while SGI began translating technological leadership into commercial momentum,” said Mr. Andrew Fan, Hesai’s CFO. “Net revenues reached RMB861 million for the three months ended June 30, 2026, with ADAS and Robotics lidar shipments growing 60% and 193% compared to the same period last year, respectively. Net income reached RMB71 million for the three months ended June 30, 2026, up 60% year-over-year despite continued investments in building SGI. The second quarter of 2026 marked our fifth consecutive quarter of GAAP profitability.” Mr. Fan continued, “This quarter also marked SGI’s first revenue contribution, led by strong early commercial traction for our industry-leading robotic actuation modules. Driven by stronger-than-expected commercialization momentum and market demand across SGI, including Kosmo on track to begin contributing revenues in the third quarter of 2026, we are raising our full-year 2026 SGI revenue guidance from RMB100 million to a range of RMB200-300 million. We are particularly encouraged by SGI’s growth trajectory and expect the business to reach approximately US$100 million in revenues in 2027 and achieve breakeven in the same year.” _________________________1 All translations from RMB to USD for the second quarter of 2026 were made at the exchange rate of RMB6.7851 to US$1.00, the exchange rate on June 30, 2026, set forth in the H.10 statistical release of the Federal Reserve Board. Lidar Business Updates: Strategic Growth Initiatives (SGI) Updates: _______________________2 “World’s first” means that, by August 2026, based on the parties’ records and a search of reasonably available public information, no earlier publicly launched commercial pilot has been identified in which a general-purpose humanoid robot independently completes a specified ice cream–making process in a real brand store and operates it for consumers. Public commercial pilots do not include laboratory tests, internal validation, or projects that are unpublished or cannot be verified. “Zero retrofitting” and “fully autonomous” refer only to the specified making process under certain predefined conditions; restocking, cleaning, maintenance, safety supervision, and exception handling still require human involvement. Q2 2026 ADAS lidar shipments were 485,904 units, representing an increase of 60.1% from 303,564 units in the corresponding period of 2025. Q2 2026 Robotics lidar shipments were 142,371 units, representing an increase of 193.4% from 48,531 units in the corresponding period of 2025. Q2 2026 Total lidar shipments were 628,275 units, representing an increase of 78.4% from 352,095 units in the corresponding period of 2025. Net revenues were RMB860.8 million (US$126.9 million) for the second quarter of 2026, representing an increase of 21.9% from RMB706.4 million for the same period of 2025. Product revenues were RMB859.7 million (US$126.7 million) for the second quarter of 2026, representing an increase of 22.9% from RMB699.4 million for the same period of 2025. The year-over-year increase was mainly attributable to increased deliveries of both ADAS and Robotics lidar products driven by robust demand, both in China and globally, partially offset by a decrease in average selling prices. Service revenues were RMB1.1 million (US$0.2 million) for the second quarter of 2026, representing a decrease of 84.3% from RMB7.0 million for the same period of 2025. The year-over-year decrease was mainly driven by lower revenues from non-recurring engineering services. Cost of revenues was RMB515.6 million (US$76.0 million) for the second quarter of 2026, representing an increase of 27.0% from RMB405.9 million for the same period of 2025. Gross margin was 40.1% for the second quarter of 2026, compared with 42.5% for the same period of 2025. The year-over-year decrease in gross margin was mainly attributable to a higher revenue contribution from products with relatively lower margins. Sales and marketing expenses were RMB49.6 million (US$7.3 million) for the second quarter of 2026, representing an increase of 17.2% from RMB42.3 million for the same period of 2025. The increase was mainly driven by an increase in payroll expenses of RMB5.5 million (US$0.8 million). General and administrative expenses were RMB67.0 million (US$9.9 million) for the second quarter of 2026, representing an increase of 5.1% from RMB63.7 million for the same period of 2025. The increase was mainly driven by an increase in professional service fees of RMB1.4 million (US$0.2 million). Research and development expenses were RMB231.2 million (US$34.1 million) for the second quarter of 2026, representing an increase of 16.0% from RMB199.2 million for the same period of 2025. The year-over-year increase was mainly due to an increase in payroll expenses of RMB22.7 million (US$3.3 million) and an increase in cost of materials of RMB6.3 million (US$0.9 million), reflecting our incremental investment in SGI. Income from operations was RMB2.2 million (US$0.3 million) for the second quarter of 2026, compared with income from operations of RMB22.9 million for the same period of 2025. Excluding share-based compensation expenses, non-GAAP income from operations was RMB33.0 million (US$4.9 million) for the second quarter of 2026, compared with non-GAAP income from operations of RMB52.1 million for the second quarter of 2025. Net income was RMB70.6 million (US$10.4 million) for the second quarter of 2026, representing an increase of 60.0% from RMB44.1 million for the same period of 2025. Excluding share-based compensation expenses, non-GAAP net income was RMB101.3 million (US$14.9 million) for the second quarter of 2026, representing an increase of 38.3% from RMB73.3 million for the same period of 2025. Net income attributable to ordinary shareholders of the Company was RMB70.6 million (US$10.4 million) for the second quarter of 2026, representing an increase of 60.0% from RMB44.1 million for the same period of 2025. Excluding share-based compensation expenses, non-GAAP net income attributable to ordinary shareholders of the Company was RMB101.3 million (US$14.9 million) for the second quarter of 2026, representing an increase of 38.3% from RMB73.3 million for the same period of 2025. Basic and diluted net income per ordinary share were RMB0.06 (US$0.01) and RMB0.05 (US$0.01), respectively, for the second quarter of 2026. Excluding share-based compensation expenses, non-GAAP basic and diluted net income per ordinary share were RMB0.08 (US$0.01) and RMB0.08 (US$0.01), respectively, for the second quarter of 2026. Cash reserve5 was RMB7,050.6 million (US$1,039.1 million) as of June 30, 2026, compared with RMB7,231.7 million as of March 31, 2026. _____________________3 See “Use of Non-GAAP Financial Measures” included in this announcement for further details.4 On July 10, 2026, the Company implemented share subdivision of the Company on the basis of every one existing issued and unissued share into eight subdivided shares ("Share Subdivision"). The Company accounted for Share Subdivision on a retrospective basis pursuant to ASC 260, Earnings Per Share. All issued and outstanding common stock, stock option awards, restricted share units, exercise prices and per share data have been adjusted in these consolidated financial statements, on a retrospective basis, to reflect the Share Subdivision for all periods presented.5 Cash reserve represents cash and cash equivalents, restricted cash, short-term investments (exclude stock investment) and long-term time deposits. Business Outlook For the third quarter of 2026, the Company expects net revenues to be between RMB1,100 million (US$162 million) and RMB1,150 million (US$169 million), representing a year-over-year increase of approximately 38% to 45%. The above outlook is based on current market conditions and reflects the Company’s preliminary estimates of market and operating conditions and customer demand, which are all subject to change. Conference Call The Company’s management will host an earnings conference call at 8:00 AM U.S. Eastern Time on August 18, 2026 (8:00 PM Beijing/Hong Kong Time on August 18, 2026). For participants who wish to join the call by phone, please access the link provided below to complete the pre-registration process and dial in 5 minutes prior to the scheduled call start time. Upon registration, each participant will receive dial-in details to join the conference call. Additionally, a live and archived webcast of the conference call will be available on the Company’s investor relations website at https://investor.hesaitech.com. A replay of the conference call will be accessible approximately an hour after the conclusion of the call until August 25, 2026, by dialing the following telephone numbers: About Hesai Hesai Technology (Nasdaq: HSAI; HKEX: 2525) is a global tech company and a leader in 3D perception. Leveraging full-stack proprietary ASIC capabilities and an integrated R&D-testing-manufacturing approach, Hesai has established industry-leading positions across core physical AI domains, including ADAS-equipped passenger vehicles, autonomous mobility, spatial intelligence, embodied AI, as well as industrial, agricultural, and service robots. Hesai has established offices in Shanghai, Palo Alto, and Stuttgart, and operates in-house factories in China and Thailand, with customers spanning more than 40 countries. As the AI-driven Fourth Industrial Revolution accelerates, Hesai is committed to becoming a key enabler of physical AI — digitizing the real world and redefining how humans and robots perceive and act. Use of Non-GAAP Financial Measures To supplement Hesai’s consolidated financial results presented in accordance with GAAP, Hesai uses the following measures defined as non-GAAP financial measures by the U.S. Securities and Exchange Commission (the “SEC”): income/loss from operations excluding share-based compensation expenses, net income excluding share-based compensation expenses, net income attributable to ordinary shareholders excluding share-based compensation, and per ordinary share net income attributable to ordinary shareholders excluding share-based compensation. The presentation of these non-GAAP financial measures is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with GAAP. Hesai believes that these non-GAAP financial measures provide meaningful supplemental information regarding its performance and liquidity by excluding share-based compensation expenses that may not be indicative of its operating performance from a cash perspective. Hesai believes that both management and investors benefit from referring to these non-GAAP financial measures in assessing its performance and when planning and forecasting future periods. These non-GAAP financial measures also facilitate management’s internal comparisons to Hesai’s historical performance and liquidity. Hesai believes these non-GAAP financial measures are useful to investors in allowing for greater transparency with respect to supplemental information used by management in its financial and operational decision making. A limitation of using these non-GAAP financial measures is that they exclude share-based compensation expenses that have been and will continue to be for the foreseeable future a significant recurring expense in our business. Management compensates for these limitations by providing specific information regarding the GAAP amounts excluded from each non-GAAP financial measure. The accompanying tables have more details on the reconciliations between GAAP financial measures that are most directly comparable to non-GAAP financial measures. Exchange Rate Information This announcement contains translations of certain RMB amounts into U.S. dollars at a specified rate solely for the convenience of the reader. Unless otherwise noted, all translations from RMB to U.S. dollars and from U.S. dollars to RMB are made at a rate of RMB6.7851 to US$1.00, the exchange rate on June 30, 2026, set forth in the H.10 statistical release of the Federal Reserve Board. The Company makes no representation that the RMB or U.S. dollars amounts referred to could be converted into U.S. dollars or RMB, as the case may be, at any particular rate or at all. Safe Harbor Statement This announcement contains forward-looking statements. These statements are made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as “will,” “expects,” “anticipates,” “aims,” “future,” “intends,” “plans,” “believes,” “estimates,” “confident,” “potential,” “continue” or other similar expressions. Among other things, the business outlook and quotations from management in this announcement, as well as the Company’s strategic and operational plans, contain forward-looking statements. The Company may also make written or oral forward-looking statements in its periodic reports to the SEC, in its annual report to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Statements that are not historical facts, including but not limited to statements about the Company’s beliefs and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: the Company’s goals and strategies; the Company’s future business development, financial condition and results of operations; expected changes in the Company’s revenues, costs or expenditures; the trends in, expected growth and the market size of the ADAS and Robotics industries; the market for and adoption of lidar and related technology; the Company’s ability to produce high-quality products with wide market acceptance; the success of the Company’s customers in developing and commercializing products using its solutions, and the market acceptance of those products; the Company’s ability to introduce new products that meet its customers’ requirements; the Company’s expectations regarding the effectiveness of its marketing initiatives and the relationship with its third-party partners; competition in the Company’s industry; the Company’s ability to recruit and retain qualified personnel; relevant government policies and regulations relating to the Company’s industry; the Company’s ability to protect its systems and infrastructures from cyber-attacks; general economic and business conditions globally and in China; and assumptions underlying or related to any of the foregoing. Further information regarding these and other risks is included in the Company’s filings with the SEC. All information provided in this announcement and in the attachments is as of the date of this announcement, and the Company undertakes no obligation to update any forward-looking statement, except as required under applicable law. In the event of any inconsistency between the English version of this earnings release and its Chinese translation, the English version of this document shall prevail unless otherwise stated. For investor and media inquiries, please contact: Hesai GroupCapital Markets DepartmentEmail: [email protected] Christensen AdvisoryTel: +86-10-5900-1548Email: [email protected] Source: Hesai Group

Hesai Group recently reported past second-quarter 2026 results, with sales rising to C¥860.83 million and net income reaching C¥70.55 million, alongside higher basic and diluted earnings per share from continuing operations. Over the first half of 2026, the company’s stronger sales and sharply improved net income, combined with guidance for higher third-quarter net revenues, underline improving profitability and management’s confidence in near-term demand. Next, we’ll examine how Hesai’s improved half-year profitability and upbeat third-quarter revenue guidance affect the existing investment narrative. Capitalize on the AI infrastructure supercycle with our selection of the 56 best 'picks and shovels' of the AI gold rush converting record-breaking demand into massive cash flow. To own Hesai, you have to believe that its lidar technology can translate design wins and capacity expansion into durable, profitable volume, despite pricing pressure and customer concentration. The latest results and third quarter revenue guidance support the near term catalyst of improving profitability, but they do not fully remove the key risk that heavy capital spending and low priced products could squeeze margins if demand or efficiencies disappoint. The most relevant announcement here is Hesai’s third quarter 2026 net revenue guidance of C¥1,100 million to C¥1,150 million, implying a solid year on year increase. In the context of recent capacity expansion and new automotive and robotics programs, this guidance matters because it tests whether rising volumes can offset lower selling prices and heavy investment, which is central to the bullish catalyst of sustained revenue growth with acceptable profitability. Yet, while the numbers look encouraging, investors should also be aware that pricing pressure on lidar hardware could eventually... Read the full narrative on Hesai Group (it's free!) Hesai Group's narrative projects CN¥8.7 billion revenue and CN¥1.4 billion earnings by 2029. This requires 40.0% yearly revenue growth and about CN¥0.9 billion earnings increase from CN¥471.7 million today. Uncover how Hesai Group's forecasts yield a $30.26 fair value, a 67% upside to its current price. Before this earnings beat, the most pessimistic analysts already expected revenue to reach about C¥7.3 billion and earnings C¥923.5 million by 2029, so this stronger quarter could either soften their concerns about margin pressure or reinforce them if they see it as temporary. You should recognize that equally informed people can read the same data very differently and it is worth weighing several views before deciding what Hesai’s latest results really mean for you. Explore 7 other fair value estimates on Hesai Group - why the stock might be worth just $19.14! Disagree with existing narratives? Extraordinary investment returns rarely come from following the herd, so go with your instincts. A great starting point for your Hesai Group research is our analysis highlighting 4 key rewards and 2 important warning signs that could impact your investment decision. Our free Hesai Group research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Hesai Group's overall financial health at a glance. The market won't wait. These fast-moving stocks are hot now. Grab the list before they run: Outshine the giants: these 17 early-stage AI stocks could fund your retirement. Invest in the nuclear renaissance through our list of 93 elite nuclear energy infrastructure plays powering the global AI revolution. The future of work is here. Discover the 37 top robotics and automation stocks leading the charge in AI-driven automation and industrial transformation. This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Companies discussed in this article include HSAI. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email [email protected]

Find your next quality investment with Simply Wall St's easy and powerful screener, trusted by over 7 million individual investors worldwide. Hesai Group (NasdaqGS:HSAI) released its second quarter and half year 2026 earnings, reporting CNY 860.83 million in quarterly sales and CNY 70.55 million in net income, giving investors fresh financial data to assess the stock. See our latest analysis for Hesai Group. Despite the solid second quarter report, Hesai Group’s latest share price of US$18.07 reflects mixed sentiment. The 30 day share price return is up 20.47%, while the year to date share price return is down 24.96% and the 1 year total shareholder return is down 32.12%. However, the 3 year total shareholder return is up 81.79%. If Hesai Group’s recent move has you thinking about where else growth and risk are being repriced, it could be a good moment to scan 56 AI infrastructure stocks. Hesai Group now trades at a small discount to one estimate of intrinsic value, yet at a much steeper gap to analyst targets after the recent bounce. Is the market’s caution still reasonable given these earnings, or is it overly harsh? Hesai Group’s last close of $18.07 sits well below the most followed narrative fair value of $27.07, which frames the stock as meaningfully undervalued on that view. Read the complete narrative. Want to see what underpins that $27.07 fair value for Hesai Group? The narrative leans on rapid volume growth, expanding end markets, and margin resilience to support its case. Result: Fair Value of $27.07 (UNDERVALUED) Have a read of the narrative in full and understand what's behind the forecasts. However, Hesai Group’s narrative could be challenged if global lidar adoption slows or if geopolitical and regulatory pressures limit its ability to scale outside China. Find out about the key risks to this Hesai Group narrative. The earlier narrative framed Hesai Group as 33.2% undervalued versus a fair value of $27.07. The preferred P/E view tells a different story. At 40.4x earnings versus peers at 14.3x and a fair ratio of 31.5x, the stock carries a clear valuation premium that could cut both ways for investors. See what the numbers say about this price — find out in our valuation breakdown. If the mixed tone around Hesai Group leaves you uncertain, you can use the latest financials, valuations, and narratives to shape your own stance quickly and confidently. To weigh the upside case against the downside concerns in one place, review the 4 key rewards and 2 important warning signs. Do not stop with Hesai Group. Use the Simply Wall St screener to quickly filter fresh stock ideas that match the kind of risk and return profile you want. Target potential bargains by checking companies that combine quality fundamentals with discounted prices through the 53 high quality undervalued stocks. Strengthen your defensive side by reviewing resilient companies with lower risk profiles using the 80 resilient stocks with low risk scores. Hunt for future leaders early by scanning a screener containing 19 high quality undiscovered gems. This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Companies discussed in this article include HSAI. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email [email protected]

Ouster Inc. OUST is riding the Physical AI lidar wave. The company reported a narrower-than-expected loss in the second quarter of 2026. Revenues of $55 million rose 56% year over year and surpassed the consensus estimate of $51 million by 7.6%. Ouster, Inc. price-consensus-eps-surprise-chart | Ouster, Inc. Quote Year to date, shares of Ouster have doubled, matching the performance of Aeva Technologies AEVA, one of its closest peers. The company outperformed other peers like Hesai Group HSAI and Innoviz Technologies INVZ, whose shares fell 14% and 55%, respectively, year to date. Image Source: Zacks Investment Research While Ouster’s share gains are backed by improving fundamentals, the company is still unprofitable, and production scaling remains an execution risk. But do these risks warrant staying on the sidelines, or are there enough catalysts to help the stock gain more upside? Let’s dig deeper to assess if this is a buy at current levels. Ouster is extending beyond lidar into a unified sensing and perception platform spanning cameras, AI compute, sensor fusion, software and AI models. The StereoLabs acquisition has broadened its reach in robotics, while the ZED X Nano has drawn substantial customer uptake in humanoid and robotic manipulation applications. In the second quarter of 2026, Ouster also expanded relationships across industrial automation, mining, security, autonomous vehicles and robotics, and deeper NVIDIA integration brought Rev8 to the DRIVE and Jetson platforms, simplifying deployment for customers building Physical AI systems. That platform expansion is already translating into commercial traction. Rev8, which introduces native color lidar, along with the longer-range OS1 Max, has drawn multiple million-dollar-plus orders from customers including a major heavy-equipment manufacturer, an autonomous agriculture developer and an autonomous vehicle provider. Ouster is scaling Rev8 production and expects to reach production volumes by the end of the third quarter of 2026, supported by an expanded Benchmark manufacturing arrangement with capacity above 100,000 units annually. Rev8 is set to become a critical part of revenues in the second half of 2026. Smart infrastructure adds a second growth engine. BlueCity supported a 42-location digital traffic twin in New Jersey and 30 intersections in Georgia, while a new order covers several hundred intersections for the Utah Department of Transportation. With roughly 300,000 signalized intersections in North America and only hundreds to thousands currently using Ouster technology, the runway remains largely untapped. The results are already showing up in the numbers. Ouster delivered its 14th consecutive quarter of product revenue growth, with product revenues up 51% year over year to $53 million, supporting management's long-term target of 30-50% annual revenue growth. The company ended June 2026 with $263 million in cash, restricted cash and short-term investments and no debt and added about $191 million of net proceeds in July, giving it sufficient liquidity to fund operations through its path to profitability. The Zacks Consensus Estimate for 2026 and 2027 revenues implies year-over-year growth of 32% and 37%, respectively. The consensus mark for 2026 and 2027 bottom line implies a year-over-year improvement of 6% and 48%, respectively. The estimates for loss per share have narrowed over the past 60 days. Image Source: Zacks Investment Research Ouster's transition from a lidar hardware vendor to a full-stack Physical AI sensing platform is starting to show up in both bookings and margins, not just narrative. With Rev8 nearing production scale, smart infrastructure barely penetrated and a fortified balance sheet removing near-term funding risk, the setup favors continued execution. Shares have already doubled this year, but that reflects improving fundamentals catching up to the story, not the story running ahead of itself. The Wall Street average price target for Ouster calls for an upside of 27% from current levels. Image Source: Zacks Investment Research As such, OUST remains a buy for investors willing to hold through the volatility that comes with a still-unprofitable, high-growth name. The stock carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Ouster, Inc. (OUST) : Free Stock Analysis Report Aeva Technologies, Inc. (AEVA) : Free Stock Analysis Report Innoviz Technologies Ltd. (INVZ) : Free Stock Analysis Report Hesai Group Sponsored ADR (HSAI) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Image source: The Motley Fool. Tuesday, Mar. 24, 2026 at 8 a.m. ET Chief Executive Officer — Yifan Li Chief Financial Officer — Peng Fan Head of Investor Relations — Yuanting Shi Need a quote from a Motley Fool analyst? Email [email protected] Yifan Li: Thank you, Yuanting, and thank you, everyone, for joining our call today. I'd like to start by taking a step back and looking at what we accomplished over the course of the year. 2025 was a defining year for Hesai. We achieved a milestone no other lidar company has reached, industry first full year GAAP net income of RMB 436 million. This was not just a year of growth, it was the year our technology leadership, operational scale and execution converged to set new standards for the industry. On the product front, we continue to lead the way. According to Gasgoo, ATX, our flagship ADAS lidar, largely contributed to our #1 position in 2025 with over 40% share of the long-range automotive lidar market. Meanwhile, our JT series entered mass production and shipped over 200,000 units in its first year alone, establishing clear leadership in Robotics as well. At the same time, we reinforced our financial position through a successful USD 614 million dual primary listing in Hong Kong, further strengthening our robust balance sheet and enhancing our capacity to support long-term growth. As we enter 2026, we are carrying significant momentum across markets. With demand accelerating across various key applications, we are raising our 2026 lidar shipment outlook to between 3 million and 3.5 million units. This reflects the massive scalability and resilience of our business. Now let's take a closer look at our business highlights, starting with our progress in the ADAS market. Currently, lidar is rapidly becoming what we call the invisible airbag, essential, affordable and increasingly standard. Over the past year, we have been a key force behind the broader rollout of lidar across the industry. We achieved 100% lidar adoption on best-selling models from partners, including Li Auto and Xiaomi, while also breaking into the sub RMB 100,000 price segment with Leapmotor. This marks a fundamental shift. Lidar is no longer a premium add-on, but a core safety feature in mainstream vehicles. Our momentum is also reflected in the strength and breadth of our partnerships. we have secured 2,026 design wins with key partners, including Li Auto, Xiaomi, BYD, Leapmotor, Great Wall Motors and Changan, many on an exclusive basis. Additionally, leading automakers such as BAIC and FAW Bestune are joining our SOP roster. Altogether, we have now secured ADAS orders from every one of the top 10 OEMs in China and have secured ADAS design wins with 40 automotive brands across more than 160 vehicle models, reinforcing our position as the partner of choice for world-class automakers. This leadership allowed us to go beyond a key milestone we first envisioned almost a decade ago, enabling 1% of all vehicles worldwide with 3D perception. With over 2 million cumulative ADAS lidars delivered, we are capturing over 40% of ADAS long-range lidar demand. This gives us significant manufacturing leverage and drives a powerful flywheel of innovation. To support accelerating growth at scale, we launched our revamped version of ATX lidar last November at our Tech Day event. Powered by our in-house FMC500 500 SoC, integrating MCU, FPGA and ADC; the revamped ATX features up to 256 channels, delivering enhanced performance, reliability and cost efficiency. With an order backlog exceeding 6 million units, it positions us strongly for the next phase of mass adoption and is expected to begin SOP in April 2026. While Level 2 drives volume, Level 3 is the value multiplier. In China, the regulatory environment has reached a pivotal inflection point. With Level 3 models now approved for public road deployment in cities such as Beijing and Chongqing, the industry is moving decisively from testing into real-world deployment. As responsibility shift from the driver to the OEM, zero failure has become a mandatory requirement. To manage complex driving scenarios, Level 3 systems need broader coverage with more lidars. This is where our FTX blind spot sensors come in, enabling full 360-degree perception. At the same time, Level 3 also demands better lidars, raising the bar on performance and reliability. Our ETX ultra high-performance long-range lidar is purpose-built for these demands. It offers around twice the detection range of ATX and will incorporate our proprietary SPAD, which eliminates the false triggers commonly seen in traditional SPAD architectures. ETX is expected to begin SOP by 2026. With recent multi-lidar design wins from Li Auto, Xiaomi and Changan, with SOP planned for 2026 to 2027, along with several late-stage Level 3 discussions underway with additional leading Chinese OEMs; we are seeing a meaningful increase in lidar content per vehicle as multi-lidar models typically feature 3 to 6 lidars per vehicle. This mirrors the evolution we saw in smartphone cameras, where increasing sensor count drove a steady expansion in total system value. We believe ADAS lidars is now entering a similar value creation cycle. Internationally, our business has also reached a critical inflection point. We are pleased to announce a strategic partnership with Grab, Southeast Asia's leading super app. With Grab as our exclusive regional distributor in Southeast Asia, we are combining Hesai's global lidar leadership with Grab's unparalleled local network to aggressively scale our footprint across the region. More significantly, we have been selected as the primary lidar partner for NVIDIA's DRIVE Hyperion 10 platform, which we view as a true game changer in how we scale globally. Historically, international expansion in automotive was a slow OEM by OEM process, often taking years of validation and negotiations. Integration into the Hyperion ecosystem enables a fundamental shift in our go-to-market approach from individual engagements to a scalable turnkey model. This positions Hesai as the default gold standard lidar choice for OEMs building autonomous driving systems on the NVIDIA platform. Additionally, we have joined NVIDIA Halo AI Systems Inspection Lab to further advance safety in autonomous vehicles and robotics. Building on our momentum, our exclusive multiyear design win with a top European OEM is progressing well, with sample deliveries firmly on track. More importantly, we've achieved a key breakthrough, unifying our high-performance lidar architecture across China and global markets with the ET series as a prime example, enabling a single platform to scale seamlessly worldwide. This unified architecture eliminates redundant development while combining China's operational agility and cost advantages with the most stringent global quality standards. In fact, Hesai is the only Asian lidar manufacturer with German VDA 6.3 process audit certification, a globally recognized benchmark for the industry's most rigorous production and quality standards. The result is a structurally advantaged one platform model, delivering superior cost, speed and global scalability that is extremely difficult to replicate, putting us firmly in the driver's seat of global expansion. Looking ahead, 2026 is going to be a pivotal year for the evolution of intelligence. As NVIDIA's CEO, Jensen Huang, described at this year's CES, we are entering the ChatGPT moment for physical AI, a shift from digital chatbots to kinetic work bots operating in our factories, streets and homes. If 2025 was the year AI learned to reason, 2026 is the year AI gains a body. However, for AI systems to truly reason about the physical world, it requires a grounding in geometric truth. While cameras provide the context or the what, lidar provides the sub-centimeter spatial accuracy, the where. This makes lidar an indispensable bridge between the carbon-based world and silicon-based intelligence. Without the spatial intelligence, physical AI remains blind to the loss of physics. This structural shift plays directly to our strengths and the results are already very encouraging. According to GGII, Yole Group and Frost & Sullivan, we now rank #1 across multiple major robotics lidar submarkets, spanning humanoid and quadruped robots, robotaxis, robovans and robotic lawn mowers. For example, our JT128 lidar showcased this leadership at the 2026 Spring Festival Gala. During China's largest broadcast, which peaked at 400 million viewers, dozens of unitary humanoid robots delivered a complex synchronized [ kung fu ] performance. By providing 360-degree blind spot-free precision perception and ultra-high reliability, JT128 lidar outperformed competing offerings, seamlessly integrating with [ Unitree ] AI algorithms to achieve ultra-low latency and eliminate cumulative motion errors, ensuring absolute stability. Beyond human robotics, we have also established a strong market position in robotic lawn mowers. We have secured orders from clients, including Dreame and MOVA, representing a backlog of over 10 million lidar units with strong follow-on potential as deployments scale. In Robotaxis, we now work with nearly every leading player, including Pony.ai, WeRide, Baidu Apollo Go, DiDi and others across North America, Asia and Europe. In Robovans, we have almost achieved full coverage of key players like Zelos, Neolix and Meituan. Beyond these segments, we are actively expanding lidar applications. Recently, we secured a design win for NIU Technologies next-gen electric 2-wheel model featuring our FTX lidar. With over 10 million electric 2-wheelers sold annually in China, this brings automotive-grade 3D perception to a massive market and unlocks a new intelligent category. Together, these fast-growing segments put us right at the heart of the robotics ecosystem, helping bring physical AI from concept to real-world action. After shipping nearly 240,000 robotics lidar units in 2025, we expect that volume to at least double in 2026. Lastly, I'd like to share what's next for Hesai over the coming decade and why we are genuinely excited about the opportunities ahead. The physical AI revolution is accelerating at an unprecedented pace, but many of its critical building blocks are still in their early stages, such as sensing, motion control, integrated AI-driven decision-making and full system orchestration. These gaps represent enormous white space opportunities, and they are exactly where we believe the next wave of transformative growth will unfold over the coming decade. Hesai is uniquely positioned to lead this next phase. We bring decades of expertise in lidar, automotive and robotics-grade hardware. Today, we are doing far more than building components. We are evolving into the key enabler of physical AI, digitizing the real world and redefining how humans and robotics perceive and act. This positions us at the forefront of the AI-driven fourth industrial revolution and perhaps more importantly, opens the door to a decade of exponential opportunity. Let's now move on to something more immediate. In the next few months, we will launch two groundbreaking products, each targeting an addressable market worth trillions of RMB. One is the eyes of physical AI, enhancing perception and situational awareness beyond what is currently possible. The other is the muscles, delivering precise powerful motion control for robots and autonomous systems operating effectively in the real world. Together, these products are expected to become Hesai's second growth engine. We anticipate initial revenue contributions beginning as early as 2026. Within 5 years, this business has the potential to rival or surpass our lidar segment and within a decade, to scale another tenfold. This is more than a product portfolio expansion. Guided by our mission to empower robotics and elevate lives, we are entering the next chapter of our growth story to become the key enabler of physical AI. If 2025 was a year of market validation and record performance, 2026 will be a year of acceleration and transformation. The opportunity ahead is massive, and we are ready to lead the way. With that, I will now turn the call over to Andrew to discuss our financial performance and outlook. Andrew, please go ahead. Peng Fan: Thank you, David, and hello, everyone. Let me start by walking you through our full year operating and financial performance and share our thoughts and outlook for 2026. To be mindful of the length of our call, I encourage listeners to refer to our earnings release for further details. 2025 was a pivotal year for Hesai, marked by remarkable progress in both our financial performance and operational execution. We delivered record net revenues of over RMB 3 billion or USD 433 million, representing an increase of 46% year-over-year. This performance was underpinned by a substantial ramp in our production volumes, with total shipments exceeding 1.6 million units, more than tripling from last year, including nearly 240,000 units from robotics lidar. This expansion reflects both robust demand across markets and our ability to execute consistently and reliably at scale across a broad range of applications from passenger vehicles, humanoid and quadruped robots to robotaxis, robovans, robotic lawn mowers and many more. Together, these have reinforced our position not only as a global volume leader, but also as the partner of choice for high-value, mission-critical applications. Beyond strong top line growth, we also significantly improved the quality of our financial performance. Gross margin remained healthy at over 40%, while operating expenses, excluding other operating income, came down RMB 88 million or USD 13 million despite substantial revenue growth. This reflects strong operating leverage supported by our disciplined cost management as well as efficiency gains enabled by AI across R&D, manufacturing and operations. These improvements flowed directly to the bottom line, enabling Hesai to achieve industry-first full year GAAP profitability with net income of RMB 436 million or USD 62 million. Full-year GAAP net income, excluding after-tax gains from equity investments of RMB 148 million or USD 21 million was RMB 288 million. or USD 41 million. On a non-GAAP basis, full year net income reached RMB 551 million or USD 79 million, with the difference from GAAP net income mainly driven by stock-based compensation. Excluding after-tax gains from equity investments, full year non-GAAP net income was RMB 403 million or USD 58 million. Kindly note that we have already delivered GAAP net income for 3 consecutive quarters and non-GAAP net income for 5 consecutive quarters, demonstrating the sustainability of our earnings performance. Just as importantly, this profitability was paired with strong cash generation. We delivered positive operating cash flow of RMB 117 million or USD 17 million during the year, marking our third consecutive year of positive operating cash flow, while our net assets grew to around RMB 9 billion or USD 1.3 billion. Today, we operate with the most robust income statement and balance sheet in the global LiDAR industry, reflecting our ability to scale technological leadership while maintaining a solid financial foundation. Building from this position of strength, we are entering 2026 with a dual focus, scaling lidar leadership while proactively expanding into new growth opportunities. We expect our core lidar business to deliver shipments of 3 million to 3.5 million units in 2026. This expanded scale will reinforce our operating leverage, supporting sustainable profitability and steady cash generation. At the same time, we expect to maintain resilient gross margins through ongoing innovation and disciplined operations. Additionally, and perhaps most excitingly, 2026 marks the beginning of commercialization for our new state-of-the-art products, which we believe will become the second growth engine for Hesai in the next decade. As we invest to advance these strategic priorities, we expect to drive a strong and resilient bottom line as we scale in 2026. For the first quarter of 2026, we expect net revenues to be between RMB 650 million and RMB 700 million or USD 93 million to USD 100 million, representing year-over-year growth of approximately 24% to 33%. We also expect revenue momentum to strengthen progressively each quarter throughout the year. To conclude, 2025 was a pivotal year that enhanced the quality and scale of our business. Building on this momentum, we are positioning to become the key enabler of physical AI, digitizing the real world, redefining how humans and robotics perceive and act. As we scale, our goal is clear: to build a globally competitive technology leader grounded in innovation and financial rigor, creating sustainable compounding value to our shareholders and the broader ecosystem. This concludes our prepared remarks today. Operator, we are now ready to take questions. Operator: [Operator Instructions] Your first question comes from Tina Hou with Goldman Sachs. Tina Hou: Congratulations on raising the volume guidance. And also, look forward to the new product launch. So my question is mainly focused on the Robotics business. Wondering if management can give us more details about the different verticals, including robotaxi, robovan as well as humanoid robot. How do you see the businesses pan out in 2026 and then beyond? Peng Fan: Thank you, Tina. It's Andrew here. I will take this question first. As David just quoted Jensen Huang's speech at CES, 2026 marks the ChatGPT moment for physical AI, where our lidar provides the crucial sub-centimeter special accuracy, serving as the indispensable bridge between the carbon-based world and silicon-based intelligence. Because of this structural shift, our Robotics business is truly blooming everywhere. We are incredibly proud to share that according to industry trackers, Hesai is now ranked #1 across major robotics lidar submarkets. Let me take a moment to walk you through the key Robotics verticals that may be of interest to our investors. First, humanoid and quadruped robot. We see humanoid and quadruped robotics as a significant long-term opportunity. At the core of this vision is the need for precise perception and action as any robot interacting dynamically with the physical world relies on accurate sensing. This makes lidar a critical and ultimately standard component for positioning, navigation and obstacle avoidance. We are currently ranked #1 in humanoid and quadruped robot segment according to GGII and have secured orders from leading players, including Unitree, HONOR Robot, Galbot, Magiclab and Vita Dynamics. We expect annual shipment in this segment to reach 5-digit levels in 2026. Our JT128 lidar was deployed across Unitree's robot at the 2026 Spring Festival Gala and was selected for its superior range and reliability, enabling large-scale synchronized movements with high precision and stability. Second, robotaxi. Hesai is the world's largest robotaxi lidar supplier according to Yole report. Our main and blind spotting lidars are widely deployed among Chinese leading players, including Pony.ai, WeRide, Baidu Apollo Go, DiDi and Hello. Globally, we have secured a supply agreement with a wide area of top autonomous driving companies across North America, Asia and Europe. In short, we collaborate with nearly every key player worldwide, an important differentiator from our peers. Whether ADAS or mechanical lidar solutions are selected by robotaxi customers, our revenue model scales with their fleet size, number of lidars per vehicle and ASP. As leading operators accelerate large-scale deployments, we expect exponential fleet growth to drive rapid revenue expansions for Hesai. For robotaxis, we anticipate 5 to 10 lidars per vehicle to ensure a full 360 degrees coverage. Thirdly, robovan. The robovan sector is undergoing a major transformation. No longer limited to closed campuses, robovans are increasingly operating on complex urban rails. Supported by favorable government policies and proven business models, the market is projected to scale from 5 digits to 6 digits of robovans in 2026. Each robovan typically features 2 to 6 lidars. Hesai is ideally positioned to capture this growth. We are the core LiDAR supplier for leading robovan players globally, including Zelos, Neolix, and Meituan and DoorDash, serving as the sole supplier for many. GII recently ranked Hesai #1 in lidar design wins for this sector. Several players that previously relied on competitors' products are switching to Hesai this year, underscoring our role as the go-to hardware partner in the accelerating commercial robovan market. Fourthly, robotic lawn mowers. The robotic lawn mower market is a major growth opportunity for our Robotics business. Global annual lawn mowers sales reached about 20 million units, yet lidar-equipped robotic lawn mowers account for just 1% to 2%, highlighting a huge untapped market as consumers adapt smarter, hands-free yard care. Hesai is moving aggressively to capture this space. Since launching the JT Series 3D lidar at CES 2025, cumulative deliverables have already exceeded 200,000 units by 2025, supported by strong global partnerships with leading brands, including Dreame, MOVA and Nexlawn. We recently secured a milestone agreement to exclusively supply 10 million JT lidars to Dreame and MOVA, ranked #1 globally by Frost & Sullivan for lidar robotic mowers in 2025. This record-setting order signals a fundamental industry shift, establishing lidar as the standard for high-end smart yard products and ushering in a new era of outdoor robotics perception. As a quick summary, across these diverse applications, our Robotics business sits at the heart of the ecosystem, consistently delivering relatively higher ASPs and strong margins. After shipping 200,000 Robotics lidar units in 2025, accelerating momentum across these segments gives us full confidence that volumes will at least double in 2026. In the long term, new types of robots will begin to adopt lidar. For example, new technologies, 2-wheel scooters recently integrated our FTX lidar for autonomous operation. The robotics market could have a TAM several times larger than ADAS. After all, you can drive only one car, but in the future, 10 robots could be working alongside you. Tina, that's my answer to the question just raised. Operator: Your next question comes from Tim Hsiao with Morgan Stanley. Tim Hsiao: This is Tim from Morgan Stanley. Congratulations on the strong results and sustained industry leadership. I just want to have a quick follow-up questions also about robotics market because the market is apparently very interesting, exciting and highly focused by investors. But we noticed that the founders of Hesai have also invested in a company called Sharpa, which has been gaining a lot of attention recently. So just want to understand how should we view the relationship between Hesai and Sharpa? And is there any opportunity for business cooperation with Hesai within that year? And how does management view the future technology and supply chain synergies between the two entities? That's my question. Yifan Li: Thank you, Tim. Thank you for the question. And it's actually a great topic, and I also wanted to offer from my side. First, I want to clearly define the structural relationship. Hesai and Sharpa are two fully independent operating entities. There is no relationship of equity subordination or operational control between them. What were the co-founders of Sharpa were responsible solely for strategic guidance at Sharpa as a core shareholder role, and we do not hold executive position for actual operational growth. Our primary and full-time identities remain the CEO, CTO and the Chief Scientist of Hesai, and our focus and energy are dedicated to Hesai. Sharpa possesses its own mature and independent team. While looking ahead, we remain open to future collaborations where it makes strategic and commercial sense as it can create an actually compelling win-win dynamic. Both companies can apply their technologies in real-world scenarios while benefiting from shared insights and industry-leading expertise. For example, as an AI robotics company, Sharpa may utilize Hesai's products while Hesai as a hardware innovator may explore deploying humanoid robots in its automated production line over time. At the same time, Sharpa's progress in AI could broaden the perspective of founders and the Hesai team and potentially inform our long-term innovation road map. That said, I want to emphasize that the coordination, if any, in the future; will be conducted strictly on fair and market-based terms with the objective of maximizing long-term value for Hesai's shareholders. Based on our preliminary estimate of the future humanoid robotics market and the growth of Hesai, such operation will only contribute a small portion of our business. As Hesai continues to evolve into a key enabler of physical AI, digitizing the real world, redefining how human and the robotics perceive and act, we remain focused on executing our core strategy. This includes strengthening our leadership in lidar, advancing our next-generation eyes and muscles product portfolio and driving sustainable long-term growth by building out the Hesai ecosystem. We believe the addressable market we're targeting over time expand well beyond the traditional lidar segment, and we're truly excited about the journey ahead. This is hopefully helpful information to help you understand what Hesai and Sharpa each are trying to do and the possible synergies and the collaborations between the two entities. Thank you, Tim, for the question. Operator: Your next question comes from Jeff Chung from Citi. Ming Chung: This is Jeff from Citi. First of all, congratulations, fantastic results. So my first question is that we have the first quarter revenue guidance. So could you give us more color on the first quarter volume guidance? And separately, we recognize Hesai did a great job with the sequential OP margin improvement in the past 4 quarters. Could you give us more color on the first quarter and the full-year GP margin and OP margin guidance? Peng Fan: Thank you, Jeff. I will take this question, and I'll try to address our 1Q and the full year guidance for 2026 to the extent I can. For the first quarter of 2026, we expect the total revenues to be between RMB 650 million to RMB 700 million, representing a solid year-over-year growth of approximately 24% to 33%. On the volume side, we anticipate total shipments to be in the range of 400,000 to 450,000 lidar units, including around 100,000 units from Robotics. We have delivered GAAP net income for 3 consecutive quarters and non-GAAP net income for 5 consecutive quarters and expect to maintain this momentum. It is important to note that due to typical automotive industry seasonality and the timing of the holidays, we do expect a sequential decrease in deliveries compared to the seasonal high we saw in the fourth quarter last year. This is entirely consistent with our historical patterns. However, the fundamental demand for our lidars remains exceptionally strong in 2026, and we expect both revenues and shipment volumes to increase sequentially over the course of 2026. We are highly confident in our accelerating momentum and our ability to maintain a healthy financial profile as we execute our 2026 road map. Looking ahead to 2026, we see it as a true inflection point. On one hand, we anticipate strong demand for lidar in both passenger vehicles and robotics, which is expected to drive meaningful increase of our full year 2026 revenues. Correspondingly, we are raising our shipment guidance to a record 3 million to [ 3 ] million units for this year, with both ADAS and Robotics lidars expected to roughly double year-over-year. While volume is scaling rapidly, we do anticipate a potential decrease in blended ASP. That's mainly due to, first, modest volume-based pricing and standard annual decline for our larger order strategic OEM customers. That's mainly for the ADAS products. And secondly, a shift in product mix towards certain lidar products with a relatively lower unit prices, such as the AT series, FT series and JT series, typically around 1 to couple of hundred U.S. dollars each. Though these products will account for a larger share of deliveries and revenue compared with our traditional high ASP Robotics products such as Pandar and XT Series. That said, we are highly optimistic about our top line and margin resilience because of several strong positive catalysts accelerating in 2026 and 2027. First, lidar is rapidly transitioning from an optional add-on to a standard configuration, successfully penetrating the mass market for vehicles priced between RMB 100,000, which will continuously drive up overall the penetration rate. Second, Level 3 vehicle deployment in China will drive multi-lidar setups, pushing lidar content per vehicle to as high as $500 to $1,000 range. We have already secured multi-lidar design wins with our core customers, including Li Auto, Xiaomi and Changan, featuring 3 to 6 lidars per vehicle, with SOP planned for 2026 to 2027. Third, our overseas ADAS business is expected to start contributing in as early as 2026, marking the beginning of global ADAS lidar mass adoption with international ADAS programs typically carrying higher ASPs. We expect our partnership with NVIDIA to roll this game forward. Fourth, our Robotics business continues to gain momentum across diverse applications and customers, and it typically carries a relatively higher ASP and margin compared to ADAS. Finally, our newly second growth engine, the eyes and the muscles of physical AI, will serve as a powerful new driver for our long-term growth. Stay tuned for two new products that we plan to launch in the coming months, each targeting at RMB 1 trillion TAM. On the profitability front, through continued cost optimization across ASIC design, supply chain and manufacturing and with the launch of our FMC500 SoC to improve cost structure in ADAS products, we expect our group blended gross margin to remain resilient in 2026, despite a strong increase in ADAS lidar shipments. As a result, we are confident that the profits from our core lidar business will continue its solid growth trajectory. Additionally, and perhaps most excitedly, 2026 marks the beginning of commercialization for our new state-of-the-art products, which we believe will become the second growth engine for Hesai in the next decade. In short, we are entering 2026 with accelerating shipments, robust revenue growth, a highly disciplined margin profile, solid bottom line increase and exciting new growth engines. Jeff, that's my answer to your question. Thanks for that. Operator: Your next question comes from Aaron Wang with Jefferies. Weijie Wang: This is Aaron from Jefferies. I just have a quick question on our guidance. Last year, we had a profit guidance for the full year. I was wondering if the company will also provide a full year net income guidance for 2026. Peng Fan: Thank you, Aaron. Given the differences in compliance requirements and listing rules between the U.S. and Hong Kong market, as you know, we just listed in Hong Kong, and to align with the best disclosure practices for dual listed companies; we have decided not to provide specific full year net income guidance at this time. However, I want to emphasize that this adjustment in disclosure does not reflect any lack of confidence in our business. On the contrary, underpinned by our solidified customer base, undisputed industry dominance and a disciplined cost structure, we are fully confident in maintaining our growth trajectory of revenues, shipments and profits in 2026. At the same time, we highly encourage investors to look forward to our new business initiatives. We are investing strategically in these areas, and they are expected to become Hesai's second growth engine. Aaron, that's my answer to your question. Operator: Your next question comes from Nora Min with UBS. Nora Min: This is Nora from UBS. Thank you for trusting me with the most exciting question. So what is the master plan behind this non-auto, non-lidar new product? Would you share with us a bit of timeline, a bit of progress, a bit of more detail? Peng Fan: Thank you, Nora. Our guiding mission has always been to empower robotics and elevate lives. We have never defined ourselves solely as a lidar company. So as Jensen Huang and David repetitively mentioned, we believe 2026 will be the ChatGPT moment for physical AI. We are entering an era where AI will truly understand the rules of the physical world and learn to interact with it, which will trigger a big bang in robotic applications. The physical AI revolution is accelerating at an unprecedented pace, but many of its critical building blocks are still in their early stages. These gaps represent enormous white space opportunities. Hesai is repositioning its role in the new era as a key enabler of physical AI, digitizing the real world, redefining how humans and robotics perceive and act. In the next few months, we will launch two groundbreaking products, each targeting a mass trillion RMB market. First, the eyes, enhancing perception and situational awareness beyond what is currently possible; and second, the muscles, delivering precise, powerful motion control for robots and autonomous systems. Regarding the financial outlook of these two new products, we anticipate initial revenue contributions from these new products beginning as early as 2026. Within 5 years, we expect this business to rival or even surpass the scale of our current lidar segment. Within a decade, it has the potential to scale another tenfold lidar -- larger. As we expand into the broader physical AI ecosystem with our upcoming eyes and muscles products, our core advantages come from strategic foresight and a decade of lidar mass production experiences. We tackle challenges head on, refining our products to lead in performance, quality and cost simultaneously. Building the muscles of physical AI naturally extends our expertise in materials, simulation, design and precision manufacturing, backed by our proprietary ethics, in-house production and rigorous quality management to deliver reliability, scalability and extreme performance at scale. For the eyes, our strength comes from world-class software and algorithm capabilities seamlessly integrated with our hardwares. Years of R&D in 3D risk construction and rendering recently earned us an award at the September 2025 SIGGRAPH Challenge, a premium global event showcasing the pinnacle of computer graphics. We are truly excited to bring these best-in-class algorithms to life in our soon-to-launch hardware tools. Together, all these capabilities let us push physical boundaries and raise performance ceilings, supporting our new positioning as Hesai evolves into a key enabler of physical AI, digitizing the real world, redefining how humans and robots perceive and act. Nora, that's my response to your question. Operator: Your next question comes from Jessie Lo with Bank of America Securities. Yu Jie Lo: This is Jesse from Bank of America Securities. Congrats on the great results. So my question is surrounding the NVIDIA cooperation. So following the announcement of us selected as the partner for NVIDIA DRIVE AGX Hyperion 10, what are the next steps? Or what could we expect to see in the coming years? And what differentiates us from the peers in this collaboration? Yifan Li: Yes. This is David. Maybe I will offer some insight and our interpretation of such a collaboration. So first of all, I wanted to just help people understand the NVIDIA -- the platform is beyond only the computational hardware. It's the full stack solution, meaning it's the hardware, the software and the data. And then we are the selected partner for lidar. What that means is that, obviously, in the end, NVIDIA has customers and the customers will ultimately decide the vendor. But as we are already selected by NVIDIA. It just makes this process a lot easier in the following way. And the first is that the system, the sensor setup, the computation is already a complete system, and that's proven. Obviously, let's say, somehow you wanted to pick a different vendor who's not on the list, it just make it harder for you to verify that. And then that's actually the smaller part of the problem. The much bigger problem is the rest, including training the model and also data collection and the verification of such a system, right? You can imagine for NVIDIA to provide such a full stack solution to all the robotaxis and the Western OEMs that they're working with you need a large amount of data they already have for the project we already have with NVIDIA, that's with Hesai lidar. So now let's say, for whatever reason, obviously, I will not understand or support, but they have to use a different lidar. And then you immediately have to face the challenge that what do you have to do with the model we train and the data we collected for the past actually years of collaboration. So it's not impossible, it just make it very inefficient if you had to do that. So -- and that's one of the reasons that we are super excited and definitely honored to be in this program. And we're also motivated to work alongside with NVIDIA when they are working with customers globally, promoting such a unified solution. And to me, this actually is the smartest way to push the autonomy because in the end, it's less important if you have different components. It's important that if you have one solution that works and then try to utilize and not reinvent, we will utilize the same solution with all those customers. And I do believe NVIDIA also shared the same vision, and that's why we are now working very closely with them in supporting them with our latest sensors and in qualifying them in different parts of the world and try to develop and accelerate the programs they already have and the new programs that they will be signing. Operator: Your next question comes from [indiscernible] with CICC. Unknown Analyst: This is Dani from CICC. Congrats on your strong results last year. I have two questions for you. The first one is about the price. What's your outlook on the trend of your ASP decline? And my second question is, could you please share more color on your methods for further cost reduction? Peng Fan: Thank you, Dani. We wouldn't suggest our investors read too much into total and blended ASPs. It's really just a simple math, and the decline is mainly driven by product mix. ADAS lidars, which are generally lower priced than our Robotics lidars, are taking a bigger share. As Level 3 ramps up, our blind spotting FTX lidars, which are lower priced than long-range ATX lidars, will push blended ASP down further. So this isn't really about price, it's mostly about mix. That said, ADAS lidars follow the typical annual automotive price declines. For example, ATX is expected to carry a price tag around $150 in 2026, which is already near an optimized cost structure. So we expect the future declines to narrow. Over time, this will be offset by structural growth, more lidars per vehicle and high-performance, higher-priced L3 products like ETX as well as expansion beyond China. Looking ahead, we see clear and durable pathways to further reduce lidar costs driven by scale, technology and manufacturing excellence. First, scale is a powerful lever. After delivering 1.6 million units in 2025, tripling year-over-year, we are guiding 3 million to 3.5 million units in 2026. This step-change in volume will meaningfully dilute fixed costs and strengthen our supply chain leverage. Secondly, our proprietary technology, chip technology is structurally lowering our BOM. With 100% in-house development of core modules and our FMC500 SoC integrating MCU, FPGA and ADC functions, we are replacing costly discrete components with a highly efficient single-chip solution, reducing cost while improving performances. Meanwhile, our in-house fab integration is expected to ramp by 2026, further improving our cost structure. Finally, our highly automated in-house manufacturing drives compounding efficiencies. By standardizing core architectures and continuously improving yields, we expect to maintain a healthy margin profile in the future. Thank you, Dani. Operator: Your next question comes from Frank Tao with CMBI. Ye Tao: I'll add my congrats on the upbeat shipment volume guidance as well. Could management share with us your outlook for the operating expenses in the year of 2026? Peng Fan: Thank you for raising this question. We are very pleased with our progress in expense management, as we guided at the beginning of last year. For year 2025, our operating expenses actually came down by RMB 88 million despite our substantial revenue growth. This clearly reflects the strong operating leverage in our business, supported by our highly disciplined cost management. A key driver behind this is that AI is at the heart of how we work. We firmly believe that any company not fully embracing AI in 2026 will inevitably be left behind by the market. Because of this, we will continuously and aggressively embrace AI to boost our operational efficiency, transform our workflows and strengthen profitability. So far, this proactive approach has already delivered tens of millions of renminbi in measurable cost savings and significantly improved our productivity. Looking ahead to 2026, we anticipate a modest mid-teen increase in overall OpEx, primarily due to RMB 200 million invested in new eyes and muscles products in R&D. Otherwise, excluding new business spend, OpEx is expected to be well managed, flat or even down in single digits in 2026, demonstrating our discipline and AI adoption. Thank you. Operator: That concludes our question-and-answer session. I'll now hand back to Yuanting Shi for closing remarks. Yuanting Shi: Thank you once again for joining us today. If you have any further questions, please feel free to contact our IR team. This concludes today's call, and we look forward to speaking to you again next quarter. Thank you, and goodbye. Before you buy stock in Hesai Group, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Hesai Group wasn’t one of them. The 10 stocks that made the cut are built for long-term growth and could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $462,983!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,375,447!* That performance is why people listen. With a track record of beating the S&P 500 by nearly 5x, Stock Advisor offers a distinct advantage. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built for the long haul. See the 10 stocks » *Stock Advisor returns as of June 2, 2026. This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. Hesai (HSAI) Q4 2025 Earnings Call Transcript was originally published by The Motley Fool