Is Hesai’s highlight moment coming?

Recently, Hesai, the first company in China's lidar industry , announced its first-quarter financial report. There were two major changes in financial data: profit in the first quarter and positive cash flow.

Specifically, in the first quarter of this year, Hesai achieved revenue of 430 million yuan, a year-on-year increase of 73.0%, and a year-on-year increase of 4.8% in the fourth quarter of last year.

Hesai's total lidar delivery volume in the first quarter reached 34,834 units, a year-on-year increase of 402.9%, of which ADAS lidar delivery volume was 28,195 units, becoming the quarterly "sales top" in the global lidar market.

Source: Hesai Technology

Gross profit margin in the first quarter of 2023 was 37.8%, an increase of 7.8% compared with the fourth quarter of last year. Since its launch in February last year, Hesai's gross profit margin has not shown steady growth. The reason is that while the AT128 has brought a large number of orders since its launch, ADAS lidar has lower profits than Hesai's early mechanical lidar. Hesai is currently in an adjustment period of product structure transformation and delivery volume growth.

As of the end of the first quarter, Hesai Technology's cash reserves reached 3.14 billion yuan. For the following second quarter, Hesai Technology expects net income to be between 410 million yuan and 430 million yuan, a year-on-year increase of approximately 94.3% to 103.8%. , which is equivalent to the first quarter.

Delivery volume increased, Hesai should thank Ideal

Since its establishment, Hesai has delivered a total of 135,000 lidar units.

After the delivery of AT128 began in July last year, Hesai's delivery volume showed a large-scale growth, of which the delivery volume in the fourth quarter of last year reached 47,000 units. Of the 80,000 lidars delivered by Hesai last year, more than 60,000 units were It's AT128.

On the other hand, the growth in Hesai's delivery volume is not unrelated to Li Auto's continued output of popular models. Since the launch of the ideal L9 equipped with AT128 last year, Hesai's delivery volume has also increased significantly. With the delivery of Ideal L8 and L7, laser radar can be optionally installed, and the delivery volume of AT128 has been further enhanced.

For this year, the Chinese market is the first to enter the stage of NOA landing in competitive cities. This is just the beginning.

Hesai's first-quarter financial report also shows that Hesai's latest customer information also includes new cars on the ideal pure electric platform , new Jidu models, and new Cyrus cars that will be released this year.

In January this year, Hesai Technology announced that AT128 had won the Feifan front-end designation.

Previously, Hesai’s main customers include Li Auto, Changan Automobile, Jidu, Gaohe and Lotus. At the same time, in the field of autonomous driving, domestic mainstream technology companies Baidu, WeRide, Pony.ai, Qingzhou Zhixing, etc. Airlines and others are also Hesai’s main customers. In the field of robotics, Hesai also serves Meituan, JD.com, Neolithic, Nuro, ZOOX, etc.

At present, the XC90, the main operating model of DiDi’s self-driving Robotaxi, and the KargoBot, Didi’s self-driving freight business, are both equipped with the Hesai AT128.

Hesai's public information shows that it has currently obtained mass production appointments from 11 mainstream OEMs, including China's largest new energy vehicle manufacturer and China's leading automobile company, six of which will start mass production and delivery before the end of 2023.

It can be inferred from this that BYD, which has the highest sales volume in China, is likely to be a potential customer of Hesai. At the same time, since this year, BYD has indeed begun to form a large-scale research and development team at the autonomous driving level, and its product line is also extending to the high end. Many new cars also have plans to be equipped with lidar.

Hesai's financial report also announced that in the first quarter of this year, Hesai also received the largest order for Robotaxi lidar in the company's history.

Expand global territory and bet on long-termism

Although the development of smart cars in China has provided Hesai with better market space for its lidar business, for Hesai. 2023 will be a year of transformation, and the business landscape will accelerate its global expansion.

According to information released by Hesai, Hesai has been favored by many North American and European OEMs. Just in May, Hesai announced that the European office established in Stuttgart, Germany, was officially opened, which also means that Hesai is committed to expanding into Europe. market.

Hesai previously predicted that the annual delivery volume will exceed one million units in 2025, and the pre-assembled mass production business will dominate.

Therefore, Hesai is still expanding its product line.

On the eve of the Shanghai Auto Show in April this year, Hesai released a car-grade ultra-thin long-range lidar ET25. The primary feature of this new lidar is that it is thin, light and compact, with a body height of only 25 mm. Compared with the AT128, the ET25 lidar is nearly half thinner. While reducing the size, it does not sacrifice performance.

The reason why the ET25 is so thin and light is to solve the problem of difficult layout due to the large lidar. With the size greatly reduced, the ET25 can be installed directly behind the windshield. This means that the ET25 must also overcome the problem of the impact of glass on lidar. To this end, Hesai also cooperated with Fuyao Glass to create a windshield specifically adapted to the ET25.

ET25 is equipped with Hesai’s self-developed transceiver chip , which not only reduces power consumption but also further optimizes performance. The maximum detection distance of ET25 can reach 250 meters under 10% reflectivity (225 meters when installed behind the windshield without windshield), which is further than the existing flagship product AT128.

It is not difficult to see from ET25 that Hesai’s product development concept for lidar is more advanced and is also considering the direction of meeting the diversified market demands in the future. The time for this lidar to be put on the market in large quantities may be 2025 or even 2026.

However, it is undeniable that when the intelligent driving experience has not become the core capability of new energy vehicles, the market explosion of lidar is far from coming. But before that, upstream hardware manufacturers like Hesai need to face the market demand in the next 3-5 years and develop more products that meet market demand.

According to CnEVPost statistics and related reports, 38 of the models on display at this year’s Shanghai Auto Show were equipped with lidar. In the Chinese market, models equipped with lidar are entering a market explosion period.

Although in terms of performance, Hesai's delivery volume far exceeds the sum of its six internationally listed peers. However, in the Chinese market, the number of pre-installed fixed models of RoboSense and Innovusion cannot be underestimated. It is foreseeable that in the past two years, Hesai's important market and competition will also be mainly concentrated in China.

Previously, CITIC Securities estimated that global passenger car lidar shipments will most likely exceed 500,000 units this year. As the penetration rate of lidar-equipped models increases, lidar companies’ cost reduction capabilities and delivery capabilities will also become a test. .

Nowadays, lidar companies are still in the sprint stage of large-scale mass production and delivery, and Hesai’s highlight moment has not really arrived yet.