Hesai Group

Refresh delta (since 2026-06-20)

1. The 1260H appeal has been decided, and not yet resolved. The Interim Report says the U.S. Court of Appeals heard oral argument on 2026-03-19 and that "On August 18, 2026, the D.C. Circuit issued a decision in our favor, holding that the DoD violated the U.S. Constitution's Due Process Clause by failing to provide us with notice and a meaningful opportunity to challenge the 2024 designation." It reversed the District Court's summary judgment for the DoD and told the District Court to remand to the DoD for further proceedings. The report adds that Hesai remains on the Section 1260H List and cannot predict the outcome of further proceedings before the D.C. Circuit, the District Court or the DoD [Interim, legal proceedings]. The prior verdict and seed name this ruling as the binary and "2026 (pending)" as its date. Nothing in the filings read says whether the 2026-06-30 DoD contract-ban date, also named in the seed, took effect for Hesai.

2. Q2 2026: net revenues RMB 860.8M (US$126.9M), +21.9% YoY (Q2 2025: RMB 706.4M); net income RMB 70.6M (US$10.4M), +60.0% (RMB 44.1M); gross margin 40.1% against 42.5%; income from operations RMB 2.2M against RMB 22.9M; non-GAAP income from operations RMB 33.0M against RMB 52.1M. The company calls it the fifth consecutive quarter of GAAP profitability [6-K Q2]. Operating margin was about 0.3%; the seed's risk (2) cites 5.6% for FY2025.

3. Q2 shipments: 628,275 lidar units, +78.4% YoY (352,095): ADAS 485,904 (+60.1%), Robotics 142,371 (+193.4%). First half: 1,099,998 units (ADAS 839,345; Robotics 260,653) [6-K Q2]. Product revenue RMB 859.7M (+22.9%) rose on volume "partially offset by a decrease in average selling prices"; service revenue RMB 1.1M (−84.3%) [6-K Q2].

4. Guidance: Q3 2026 net revenues RMB 1,100M to RMB 1,150M (US$162M to US$169M), about +38% to +45% YoY [6-K Q2, Business Outlook]. Full-year 2026 revenue from Strategic Growth Initiatives (SGI) raised from RMB 100M to RMB 200M-300M; the CFO expects SGI at about US$100M of revenue and breakeven in 2027 [6-K Q2]. First-half revenue was RMB 1,541.4M; the Q1 figure is a number in the prior dossier.

5. SGI and robotics, as reported: actuation modules began generating revenue in Q2, with over 10,000 units delivered by quarter-end and "six-digit" annual shipments expected in 2027; Kosmo (spatial-intelligence platform) shipped prototypes in July 2026 with first revenue expected in Q3; Picasso SoC is "SOP-ready" [6-K Q2]. Design wins named in the release: Great Wall Motor (ETX, SOP late 2026), GAC Toyota bZ7, and "a major global design win with Volkswagen" across its China joint ventures; Li Auto extended to the L6. The release cites a 44% share of China's long-range ADAS lidar market in June 2026 (Gasgoo, as quoted by the company) [6-K Q2].

6. Related party: the Sharpa cap was tripled. Sharpa buys Hesai's robotic actuators. On 2026-07-31 Shanghai Hesai revised the annual cap under its supply framework agreement with Shanghai Sharpa from RMB 100M to RMB 300M. The Co-Founders together indirectly hold majority voting rights in Shanghai Sharpa, so this is a continuing connected transaction needing shareholder approval [6-K related party; Interim]. The 6-K filed 2026-08-28 reports poll results of the 2026-08-28 extraordinary meeting; the poll text was not read. The balance sheet carries RMB 50.2M due from a related party at 2026-06-30 (nil at 2025-12-31) [Interim, balance sheet].

7. Share structure: effective 2026-07-10 every share was subdivided into eight, and each ADS now represents eight Class B shares instead of one; no new ADSs were issued and the ADS count is unchanged [6-K split]. Per-share figures in the Q2 release are restated for the split [6-K Q2, footnote 4]. Any ADS-based price or target in the prior dossier is on the old one-share basis.

8. Balance sheet, 2026-06-30 against 2025-12-31 [Interim, balance sheet]: cash and equivalents RMB 1,510.1M (1,663.5M); short-term investments RMB 5,139.7M (3,091.9M); long-term investments RMB 452.3M (2,781.7M); accounts receivable, net RMB 1,099.7M (1,262.2M); inventories RMB 868.5M (670.5M); total assets RMB 11,004.2M (11,261.3M); total liabilities RMB 2,053.5M (2,302.5M). The company's cash reserve was RMB 7,050.6M (US$1,039.1M) against RMB 7,231.7M at 2026-03-31 [6-K Q2]. Inventories rose 29.5% in six months. Net cash used in operating activities was RMB 102.6M for the first half, against RMB 265.4M used in the first half of 2025 [Interim, cash flow statement].

What held

• Profitable every quarter through Q2 and net cash, as the verdict and seed describe (facts 2 and 8).
• The price war the seed's risk (2) names is still visible: gross margin fell 2.4 points YoY on mix and average selling prices fell (facts 2 and 3).
• Operating cash flow is still negative for the half, so the receivables and cash-conversion concern in the seed's risk (4) has not turned into cash yet, although receivables fell RMB 162.5M in six months (fact 8).
• The founders' related-party link to a robotics customer the seed's robotics catalyst depends on is now larger, not smaller (fact 6).