Hesai's Profit Puzzle: LiDAR Funds Growth?

Hesai Group (NASDAQ:HSAI) achieved a 21.9% year-over-year revenue increase in the second quarter, reaching RMB860.8 million. Total LiDAR shipments surged by 78.4% to 628,275 units.

While net income rose 60% to RMB70.6 million, marking its fifth consecutive profitable quarter, the company's stock experienced a decline. This was influenced by the financial performance of its newer ventures.

The core LiDAR business generated RMB66.2 million in operating profit. However, Strategic Growth Initiatives (SGI) reported an operating loss of RMB64.0 million, despite achieving its first revenue of RMB44.9 million, primarily from robotic actuation modules.

Hesai has raised its 2026 SGI revenue guidance to RMB200 million-RMB300 million and anticipates the business will reach breakeven and approximately $100 million in revenue by 2027.

Despite the losses in SGI, Hesai maintains a robust financial position with a liquidity balance of RMB7.05 billion as of June 30, providing ample capacity for further development and expansion.