The LiDAR specialist is expanding beyond autonomous driving as its robotics products begin moving from development into commercial use
By Doug Young
For years, Hesai Group (HSAI.US; 2525.HK) has built its business around helping vehicles and robots see the world through light detection and ranging (LiDAR) technology. Now, the Chinese technology company is moving further up the robotics stack, betting that its expertise in sensing can give it a foothold in a much broader market.
That strategy was on full display in its latest earnings report, which described the second quarter as a “defining milestone” as Hesai accelerated its push into robotics. Co-founder and CEO Li Yifan, also known as David Li, said the company has evolved into “a full-stack infrastructure platform for robotics and Physical AI — empowering them to see, understand, and act.”
Hesai’s two main new initiatives are its Kosmo spatial intelligence platform and robotic actuation modules, both of which are now beginning to move toward commercialization. The company’s core LiDAR business, meanwhile, continues to grow rapidly.
Second-quarter revenue reached 861 million yuan ($127 million), while net profit rose 60% year-on-year to 71 million yuan despite continued investment in the new businesses. It was Hesai’s fifth consecutive quarter of GAAP profitability.
From spatial intelligence to movement
Kosmo combines an AI-powered spatial camera, AI algorithms, 3D spatial data and cloud services into a single platform. Hesai says it can turn real-world environments into editable, interactive 3D models for uses ranging from robotics and cultural tourism to film production, gaming and advertising.
The company delivered its first Kosmo prototypes in July and has already received orders from several humanoid robotics companies, including Galbot. It said it is in discussions with more than 200 potential partners across multiple industries and expects the platform to begin generating revenue in the third quarter of 2026.
Hesai has also begun commercializing robotic actuation modules, which it says combine precise control, compact dimensions, high force output and true backdrivability. Compared with other leading products, the company says its modules offer roughly three times the torque and power density while taking up 37% less space.
The modules generated their first revenue in the second quarter. Hesai said its dedicated production line is now fully operational and had delivered more than 10,000 units by the end of June. Shipments have expanded from dexterous hands to full-body applications, with volumes expected to reach six figures in 2027.
The opportunity is enormous. Morgan Stanley estimates that cumulative global adoption of humanoid robots could reach about 1 billion units by 2050, with annual industry revenue potentially reaching $7.5 trillion. China is becoming an increasingly important part of that market: the investment bank recently almost doubled its forecast for Chinese humanoid robot shipments this year to 50,000 from 28,000.
Hesai was the first company in its peer group to become profitable, recording its first annual profit of 436 million yuan last year while most competitors remained in the red. Its profitability is reflected in its valuation: the stock currently trades at a price-to-sales ratio of 6.32, compared with 4.87 for RoboSense (2498.HK) and just 0.70 for Seyond (2665.HK), both of which are still loss-making.
LiDAR remains the core
Despite the attention surrounding its robotics initiatives, Hesai’s latest results also show that its original LiDAR business continues to deliver strong growth.
LiDAR shipments jumped 78.5% year-on-year to 628,275 units in the second quarter, significantly faster than revenue growth. That reflects the growing contribution from relatively low-priced LiDAR systems used in advanced driver-assistance systems (ADAS) as the technology becomes more widely adopted.
ADAS LiDAR for autonomous vehicles still accounted for the majority of shipments, rising 60% to 485,904 units. But robotics-related LiDAR is growing much faster, with shipments soaring 193% to 142,371 units during the quarter.
In the automotive market, demand is being helped by the industry’s shift toward multiple LiDAR systems for Level 3 (L3) autonomous driving, where safety redundancy is required. Each L3 vehicle could eventually need three to six LiDAR devices, representing $500 to $1,000 of potential revenue per vehicle for companies such as Hesai.
Hesai said its products were featured in 56 models at the Beijing Auto Show in April, including vehicles from Geely, Cadillac, Audi, BYD and Chery, as well as electric vehicle makers Xiaomi, Li Auto and Leapmotor and robotaxi operator Pony AI. Its LiDAR products are also used by more than 50 embodied AI and robotics companies.
The company is continuing to invest in the technology underpinning that business. In April, it unveiled Picasso, a single-photon avalanche diode system-on-chip (SPAD-SoC) that it describes as the brains of its next-generation LiDAR products. Hesai said in its latest results that Picasso is ready for mass production, while the LiDAR unit incorporating the technology is undergoing customer validation.
Analysts remain broadly positive on Hesai, with Citigroup, Goldman Sachs and Morgan Stanley among the investment banks rating the stock a “buy.” Institutional investors are also showing confidence, with Schroder Investment Management, Vanguard Capital Management, Fidelity Management & Research and BlackRock each holding stakes of more than 1%.
For Hesai, the immediate challenge will be turning its early robotics traction into a meaningful second business without losing momentum in the LiDAR market that built the company in the first place.
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