Hesai Group (HSAI) 2024 Q2 法說會逐字稿

Hello, ladies and gentlemen. Thank you for standing by for Hesai Group's second-quarter 2024 earnings conference call. (Operator Instructions) Please note that today's conference call is being recorded.

各位女士、先生們，大家好。感謝您參加和賽集團2024年第二季財報電話會議。（操作員說明）請注意，今天的電話會議正在錄音。

I will now turn the call over to our first speaker today, Yuanting Shi, the company's Investor Relations Director. Please go ahead.

現在我將把電話交給今天的第一位發言人，公司投資者關係總監石元廷。請繼續。

Thank you, operator. Hello, everyone. Thank you for joining Hesai Group's second-quarter 2024 Earnings Conference Call. Our earnings release is now available on our IR website at investor.hesaitech.com as well as via newswire services.

謝謝接線生。大家好。感謝您參加和賽集團2024年第二季財報電話會議。我們的獲利報告現已發佈在我們的投資者關係網站 investor.hesaitech.com 上，也可透過新聞專線發布。

Today, you'll hear from our CEO, Dr. David Li, who will provide an overview of our recent updates and address our financial results before we open the call for questions.

今天，我們的執行長李大衛博士將概述我們最近的最新進展，並介紹我們的財務業績，之後我們將開放提問環節。

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 on GAAP in our news release and SEC filings.

在繼續之前，請各位參閱我們盈利新聞稿中的“安全港聲明”，該聲明適用於本次電話會議，因為我們將做出前瞻性陳述。另請注意，該公司今天將討論非GAAP指標，這些指標在我們的新聞稿和提交給美國證券交易委員會的文件中進行了更詳細的解釋，並與GAAP下報告的最可比指標進行了核對。

With that I'm pleased to turn over the call to our CEO, Dr. David Li. David, please go ahead.

接下來，我很高興將電話交給我們的執行長大衛李博士。大衛，請繼續。

Thank you, Yuanting, and thank you, everyone, for joining our call today.

謝謝袁婷，也謝謝各位今天參加我們的電話會議。

I'll begin with an overview of the wider market trends and some recent business highlights before moving on to our second-quarter financial and operational results. We are thrilled to announce that Hesai has been recognized as the number one automotive LiDAR company by market share for the third consecutive year, according to the latest LiDAR for automotive reports from Yole Intelligence, a world renowned European independent research firm.

我將首先概述更廣泛的市場趨勢和最近的一些業務亮點，然後再介紹我們第二季的財務和營運表現。我們非常興奮地宣布，根據世界知名的歐洲獨立研究公司 Yole Intelligence 最新發布的汽車光達報告，Hesai 連續第三年被評為市場份額排名第一的汽車光達公司。

2023 was a stellar year for Hesai, marked by record breaking revenues and shipments, strategic design wins, and expanded product lineup and new partnerships. Our expertise in both passenger cars and robo-taxis enabled us to capture 37% of the global LiDAR markets and an impressive 74% share of the global robo-taxi LiDAR market in 2023, demonstrating our clear leadership of the global automotive LiDAR market. Yole's recognition inspires us to aim even higher as we continue to deliver the most advanced and powerful LiDAR products, driving further growth and innovation in the dynamic automotive industry.

2023 年對 Hesa​​ 來說是輝煌的一年，公司營收和出貨量均創歷史新高，贏得了多項策略設計訂單，產品線不斷擴大，並建立了新的合作夥伴關係。我們在乘用車和無人駕駛計程車領域的專業知識使我們得以在 2023 年佔據全球雷射雷達市場 37% 的份額，並在全球無人駕駛計程車雷射雷達市場佔據令人矚目的 74% 的份額，這充分證明了我們在全球汽車雷射雷達市場的領先地位。Yole 的認可激勵我們追求更高的目標，我們將繼續提供最先進、最強大的雷射雷達產品，推動充滿活力的汽車產業的進一步成長和創新。

Next, a brief update on autonomous mobility business. At present, one of the most exciting developments in China is the rising robo-taxi market, which is scaling and commercializing at an impressive pace. We're delighted to witness this movement and proud of Hesai's key role in promoting this trend. Baidu's Apollo Go, an autonomous driving channel travel platform, has recently launched operations in Wuhan, one of China's largest cities. This launch has garnered significant market interest and numerous orders highlighting the continued development path and the tremendous potential of the robo-taxi business.

接下來，簡單介紹一下自動駕駛出行業務的最新情況。目前，中國最令人興奮的發展之一是蓬勃發展的無人駕駛計程車市場，該市場正以驚人的速度擴大規模並實現商業化。我們很高興見證這一趨勢，並為何賽在推動這一趨勢中發揮的關鍵作用感到自豪。百度旗下的自動駕駛出行平台Apollo Go近日在中國最大的城市之一武漢正式上線營運。此次發布引起了市場的極大興趣，並獲得了大量訂單，凸顯了無人駕駛計程車業務的持續發展路徑和巨大潛力。

According to media reports, Apollo Go has provided over 6 million robo-taxi rides in 11 Chinese cities since 2019. We'll be serving as Baidu Apollo Go's exclusive supplier for their vehicles' main perception LiDAR. With their sixth generation rolling out this year, each vehicle is equipped with four of our AT128 ADAS LiDARs, marking the first large-scale application of ADAS LiDAR solution on robo-taxis in China.

據媒體報道，自 2019 年以來，Apollo Go 已在中國 11 個城市提供了超過 600 萬次無人駕駛計程車服務。我們將成為百度Apollo Go車輛主感知光達的獨家供應商。今年推出的第六代車型，每輛車都配備了四個我們的 AT128 ADAS 雷射雷達，標誌著 ADAS 雷射雷達解決方案在中國的無人駕駛計程車領域首次大規模應用。

Our collaboration with Apollo Go is a prime example of how our advanced LiDAR solution at an attractive price point can provide a comprehensive object perception, accelerating the adoption and the commercialization of driverless vehicle globally.

我們與 Apollo Go 的合作就是一個很好的例子，它證明了我們先進的雷射雷達解決方案以極具吸引力的價格能夠提供全面的物體感知，從而加速無人駕駛汽車在全球範圍內的普及和商業化。

Let's now turn our attention to the ADAS market. In the last quarterly update, we underscored the significance of 2024 as a decisive year for the LiDAR industry leap to mass market popularity. According to GGII, a renowned automotive research and consulting firm, the LiDAR adoption rate among EV priced above RMB150,000 is projected to surpass 16% this year, [baring] towards 50% in alignment with the famous crossing the Kaizen innovation adoption model.

現在讓我們把注意力轉向ADAS市場。在上一季更新中，我們強調了 2024 年對於光達產業實現大眾市場普及的決定性一年的重要性。據知名汽車研究顧問公司GGII稱，今年售價15萬元人民幣以上的電動車中，光達的採用率預計將超過16%，接近50%，這與著名的「改善」創新採用模式的跨越相一致。

We are pleased to note that this critical 16% inflection point will reach earlier than the market anticipate it. According to the latest data, our overall LiDAR penetration rate in China reached an impressive 22% in June of this year, driven by consistent monthly increases of approximately 2% over the past three months. Additional June statistics also reflected strength, revealing that average LiDAR adoption rate among the top 10 best-selling new EV makers in China exceed 60% of the total sales and volume.

我們很高興地註意到，這一關鍵的 16% 轉折點將比市場預期的更早到來。根據最新數據，今年 6 月，我們在中國的整體雷射雷達滲透率達到了令人矚目的 22%，這得益於過去三個月每月約 2% 的持續成長。6 月的其他統計數據也反映了強勁勢頭，數據顯示，中國十大最暢銷新電動車製造商的平均 LiDAR 採用率超過總銷量和總體積的 60%。

In the first half of the year, LiDAR installations increased remarkably by approximately 250% year over year, outpacing the growth rate of other sensor installations by almost 10 times These figures highlight LiDAR's accelerated acceptance and its critical role in enhancing vehicle safety and comprehensively improving autonomous driving capabilities.

今年上半年，光達的安裝量年增約 250%，增速幾乎是其他感知器安裝量增速的 10 倍。這些數據凸顯了雷射雷達的快速普及及其在提升車輛安全性和全面提高自動駕駛能力方面發揮的關鍵作用。

We anticipated that LiDAR will continue to drive innovation across automotive industry and shape the future of smart transportation. In light of these LiDAR market trends, our strategic approach of offering both ultimate performance and ultimate value-to-cost products has positioned us to adapt fully address the diverse needs of our extensive client base.

我們預計光達將繼續推動汽車產業的創新，並塑造智慧交通的未來。鑑於雷射雷達市場的這些趨勢，我們採取的策略方針是提供性能卓越且性價比極高的產品，這使我們能夠充分適應並滿足我們龐大客戶群的各種需求。

Our next-generation flagship products, such as the ATS and AT512 are gaining significant traction -- OEMs competing intelligent audio functions. Maintaining a flexible and competitive product roadmap has also enabled us to secure crucial design wins for new car models scheduled for SOP in 2025 and beyond.

我們的下一代旗艦產品，如 ATS 和 AT512，正在獲得顯著的市場認可——OEM 廠商競相推出智慧音訊功能。保持靈活且具競爭力的產品路線圖也使我們能夠為計劃於 2025 年及以後投產的新車型贏得關鍵的設計訂單。

In the second quarter, we recorded a series of new design wins we did in the domestic market. Our deliveries for those models are scheduled to begin next year. These include a flagship model from a top-selling EV maker, new to our client roster, which currently has 15,000 vehicles shipments per month. Our existing customers who are among the largest EV shippers in China have also extended their partnership with us to include multiple new models and facelifts set to launch starting in 2025.

第二季度，我們在國內市場取得了一系列新的設計訂單。這些車型的交付計劃於明年開始。其中包括暢銷電動車製造商的旗艦車型，該製造商是我們的客戶名單上的新成員，目前每月出貨量為 15,000 輛。我們現有的客戶是中國最大的電動車運輸商之一，他們也擴大了與我們的合作關係，涵蓋了將於 2025 年開始推出的多款新車型和改款車型。

The rapid adoption of our products by these key players reflects our competitive edge and the substantial value we provide. Notably [and elsewhere] autonomous driving technology promises that unprecedented consumer experience. There is a growing trend in the domestic market to prioritize high-performance LiDAR products for next-generation vehicles targeting L3 standards alongside domestic OEM's historical focus on cost efficiency.

這些關鍵企業迅速採用我們的產品，體現了我們的競爭優勢和我們提供的巨大價值。值得注意的是（以及其他地方），自動駕駛技術有望帶來前所未有的消費者體驗。國內市場出現了日益增長的趨勢，即優先考慮面向下一代車輛、達到 L3 標準的高性能雷射雷達產品，同時保持國內 OEM 一貫注重成本效益的做法。

Among the previously mentioned new design wins, a leading EV maker has already signed agreements with us to exclusively adopt Hesai next-generation L3 ultra-high-performance LiDAR for all their new models scheduled for release in 2025. This further solidifies our position as a leader in advanced LiDAR technology and opens the gate for more domestic OEM to follow.

在前面提到的新設計中，領先的電動車製造商已經與我們簽署了協議，將在其計劃於 2025 年發布的所有新車型中獨家採用 Hesa​​i 的下一代 L3 超高性能 LiDAR。這進一步鞏固了我們在先進光達技術領域的領先地位，並為更多國內OEM廠商效仿打開了大門。

On the international front, we have secured design wins with four prominent global OEMs, including three joint ventures in China with two American and one European automotive companies. Some of the models will be shipped both domestically and globally.

在國際方面，我們已與四家全球知名的汽車製造商達成設計合作協議，其中包括與兩家美國汽車公司和一家歐洲汽車公司在中國成立的三家合資企業。部分型號將在國內和國際市場同時發售。

Most notably, we have been selected by a global automotive OEM for its worldwide shipping program. Unlike some of the competitors who are still in the B sample development phase, we are progressing towards the actual delivery of B samples for this milestone design win. Additionally, we've been awarded new POC programs with two leading global OEMs from Europe, including a prestigious sports car brand to test Hesai's next-generation high-performance long-range and short-range LiDAR.

最值得一提的是，我們已被一家全球汽車原始設備製造商選中，參與其全球運輸計畫。與一些仍在 B 樣品開發階段的競爭對手不同，我們正在朝著實際交付 B 樣品的目標邁進，以實現這一里程碑式的設計目標。此外，我們還獲得了來自歐洲兩家領先的全球 OEM 廠商的新 POC 項目，其中包括一家著名的跑車品牌，用於測試 Hesa​​ 的下一代高性能遠程和近程雷射雷達。

While these two POCs are not yet fully design wins, we believe they have potential to convert into real deals in the future. To date, we have secured ADAS design wins with a total of 19 OEMs globally across over 70 vehicle models. This includes ADAS series production partnerships with 6 out of the top 10 global OEMs directly or two entities within the group, and 8 out of the top 10 domestic OEMs measured by their revenue in 2023.

雖然這兩個概念驗證項目尚未完全轉化為實際的成功案例，但我們相信它們未來有潛力轉化為真正的交易。迄今為止，我們已與全球 19 家汽車製造商合作，在 70 多款車型上贏得了 ADAS 設計合約。這包括與全球前 10 大 OEM 廠商中的 6 家直接或集團內兩家實體開展 ADAS 系列生產合作，以及與 2023 年收入排名前 10 的國內 OEM 廠商中的 8 家開展 ADAS 系列生產合作。

Among these 19 OEMs, 13 of them have chosen Hesai as their exclusive long-range LiDAR supplier, further demonstrating the trust and confidence industry places in our products and capabilities.

在這 19 家 OEM 廠商中，有 13 家選擇 Hesa​​ 作為其獨家遠程雷射雷達供應商，進一步證明了業界對我們產品和能力的信任和信心。

Now let's briefly go through our operating and financial results for the second quarter of 2024. To be mindful of the length of the earnings call today, I encourage listeners to refer to our second-quarter earnings press release for further details.

現在讓我們簡要回顧一下我們 2024 年第二季的營運和財務表現。鑑於今天財報電話會議時長較長，我建議聽眾參考我們第二季財報新聞稿以了解更多詳情。

In the second quarter, we achieved quarterly revenue of RMB458.9 million, USD63.1 million, reaching the high end of our guidance. In addition, our LiDAR shipments rose to over 86,000 units, marking an increase of 66% year over year and a 46% quarter over quarter. Our blended gross margin was robust at approximately 45% improving quarter over quarter, thanks to effective cost management and our flywheel approach to costs and scale optimization as well as additional service revenue contribution during the quarter.

第二季度，我們實現了季度營收4.589億元人民幣（6,310萬美元），達到了我們預期的上限。此外，我們的雷射雷達出貨量增加至 86,000 台以上，年增 66%，季增 46%。由於有效的成本管理和我們透過飛輪效應優化成本和規模，以及本季服務收入的額外貢獻，我們的綜合毛利率穩健地達到約 45%，環比有所提高。

As a result, our quarterly net loss narrowed significantly by 33% quarter over quarter to RMB72.1 million, USD9.9 million. These accomplishments highlight our best-in-class execution within the global LiDAR industry in streamlining our operations. We continue to anticipate stronger performance in the second half of the year, both in terms of revenues and shipments.

因此，我們的季度淨虧損環比大幅收窄 33%，至人民幣 7,210 萬元，990 萬美元。這些成就凸顯了我們在全球雷射雷達產業中精簡營運的最佳執行力。我們持續預期下半年業績將更加強勁，無論是在收入或出貨量方面。

For the third quarter of 2024, we expect net revenue to be between RMB450 million, USD61.9 million and RMB500 million, USD68.8 million, representing a year-over-year increase of approximately 1% to 12.2% in light of our downstream adjustments to accommodate the postponed SOP timeline for certain client vehicle models, we've revised our full year revenue forecast to be within a range of RMB2.0 billion to RMB2.3 billion, roughly USD280 million to USD320 million.

2024年第三季度，我們預期淨收入將在人民幣4.5億元（6,190萬美元）至人民幣5億元（6,880萬美元）之間，年增約1%至12.2%。鑑於我們為適應某些客戶車型標準作業程序（SOP）時間表的延遲而進行的下游調整，我們已將全年收入預測修訂為人民幣20億元至23億元（約2.8億美元至3.2億美元）。

Additionally, we anticipate less than 20% of our total revenue will come from the US market. The vast majority of our revenue will be generated outside the US, driven by the increasing demand for LiDAR technology elsewhere. Despite the recent downstream adjustment in ADAS and unexpected production delays of the robo-taxis since late 2023, our financial strength remains robust, reflecting the resilience of our business.

此外，我們預計來自美國市場的收入將不到總收入的 20%。我們絕大部分的收入將來自美國以外地區，這主要得益於其他地區對光達技術日益增長的需求。儘管ADAS近期進行了下游調整，並且自2023年底以來無人駕駛計程車的生產出現了意料之外的延誤，但我們的財務實力依然強勁，這反映了我們業務的韌性。

Our cost management initiatives have yielded a better-than-expected result in terms of our blended gross margins, compared to our earlier guidance, which projected a blended gross margin at the higher end of the 30% to 35% range for the full year of 2024. We now foresee the blended gross margin for the third and fourth quarter is expected to be close to 40%. This expectation holds true even with the notable year-over-year growth in ADAS business, which although expanding rapidly, has traditionally had a lower margin.

與先前的預期相比，我們的成本管理措施在綜合毛利率方面取得了超出預期的結果。先前的預期是，2024 年全年綜合毛利率將達到 30% 至 35% 區間的較高水準。我們現在預計第三季和第四季的綜合毛利率將接近 40%。即使ADAS業務實現了顯著的年成長，這項預期仍然成立。儘管ADAS業務發展迅速，但其利潤率歷來較低。

We are not aware of any other player in the global LiDAR industry that matches our financial strength while operating on such a massive delivery scale. We anticipate that effective expense controls and optimized operational efficiencies will bring us closer to achieving profitability in the fourth quarter of this fiscal year.

我們認為，在全球雷射雷達產業中，沒有其他任何一家公司能夠像我們一樣擁有如此雄厚的財力，同時也能實現如此大規模的交付。我們預計，有效的費用控制和優化的營運效率將使我們更接近在本財年第四季實現盈利。

We'd like to remind you that this outlook is based on the current market conditions and reflects the company's preliminary estimate of the market and operating conditions and customers' demand, which are all subject to change.

我們想提醒您，此展望基於當前市場狀況，反映了公司對市場和經營狀況以及客戶需求的初步估計，所有這些都可能發生變化。

Looking ahead, we see strong growth opportunities. Our strategic initiative and market positioning laid a solid foundation for future success. We're confident in our growth potential for '25 and '26 and expect to continue outperforming our LiDAR peers, driven by the following key factors: first, we're strategically positioned to benefit from the rapid growth of the robo-taxi market, particularly in China. The recent launch of Baidu's Apollo Go across 11 major Chinese cities marks the beginning of a new era. Industry analysts estimate that this LiDAR deal is worth USD200 million to USD300 million based on Baidu's plan to deploy approximately 100,000 robo-taxi vehicles in China.

展望未來，我們看到了強勁的成長機會。我們的策略性舉措和市場定位為未來的成功奠定了堅實的基礎。我們對 2025 年和 2026 年的成長潛力充滿信心，並期望繼續超越我們的雷射雷達同行，這主要得益於以下幾個關鍵因素：首先，我們已做好戰略準備，能夠從無人駕駛出租車市場的快速增長中受益，尤其是在中國。百度Apollo Go近期在中國11個主要城市上線，標誌著一個新時代的開始。產業分析師估計，根據百度在中國部署約 10 萬輛無人駕駛計程車的計劃，這筆光達交易價值 2 億至 3 億美元。

This move is expected to be the first extensive deployment of robo-taxi technologies in the Chinese market. And Baidu's advancements are just the tip of the iceberg. Other leading robo-taxi players are also making significant strides. Notably, all of the top five robo-taxi companies in China have selected Hesai as their exclusive main perception LiDAR supplier. As our robo-taxi customers continue to enhance cost efficiencies and scale their operations, we anticipate a strong rebound in our robo-taxi -related revenues in the coming years.

預計這將是無人駕駛計程車技術在中國市場的首次大規模部署。百度取得的進步僅僅是冰山一角。其他領先的無人駕駛計程車公司也在取得顯著進展。值得注意的是，中國排名前五的自動駕駛計程車公司都選擇了合賽作為其獨家主感知雷射雷達供應商。隨著我們的無人駕駛計程車客戶不斷提高成本效益並擴大營運規模，我們預計未來幾年與無人駕駛計程車相關的收入將強勁反彈。

Second, the ADAS sector, which secured key design wins with 19 leading OEMs globally, 13 of which have selected us as their exclusive long-range LiDAR supplier. Our strategic approach of offering both ultimate performance and ultimate value to cost of products is generating a robust ADAS order pipeline for 2025 and 2026, stronger than that of our peers. Our ATS LiDAR designed for mass market and the large scale adoption has secured design wins from seven OEM as of the end of second quarter.

其次，在 ADAS 領域，我們與全球 19 家領先的 OEM 廠商達成了關鍵的設計合作，其中 13 家廠商選擇我們作為其獨家遠程雷射雷達供應商。我們採取的策略方針是提供性能卓越且性價比極高的產品，這為 2025 年和 2026 年創造了強勁的 ADAS 訂單管道，比我們的同行更為強勁。截至第二季末，我們以大眾市場和大規模應用設計的 ATS LiDAR 已獲得七家 OEM 廠商的設計訂單。

This positions us for millions of units used throughout the coming years based on customer demand forecast. Furthermore, we are the sole recognized provider of ultra-high performance LiDAR, particularly our AT512 for OEMs aiming to achieve Level 3 standard in the next generation of intelligent vehicles. Notably, we're executing Level 3 series production programs using this advanced technology, including collaborations with a leading EV maker in China and a leading global OEM.

根據客戶需求預測，這將使我們在未來幾年內獲得數百萬台設備的使用量。此外，我們是公認的超高性能雷射雷達供應商，特別是我們的 AT512，專為旨在實現下一代智慧汽車 L3 標準的 OEM 而設計。值得一提的是，我們正在利用這項先進技術執行 3 級系列生產計劃，包括與中國領先的電動車製造商和全球領先的 OEM 廠商合作。

These achievements position our ADAS business for exceptional growth, both domestically and internationally, supported by our cutting edge technology and proven track record of over 450,000 LiDAR deliveries since inception as of end of the second quarter.

這些成就使我們的 ADAS 業務在國內和國際市場都實現了卓越的成長，這得益於我們的尖端技術和自成立以來（截至第二季末）交付超過 45 萬台 LiDAR 的可靠業績。

Third, we anticipate that the introduction of regulations mandating higher safety standards will be transformative for the LiDAR industry. Initiatives such as China's newly launched Level 3 policy and NHTSA's AVB speed requirements in the US are propelling advancements in intelligent driving with an unprecedented emphasis on safety. Meanwhile, more OEMs and consumers are recognizing LiDAR configurations as essential safety features just like safety belt or airbags. As a global leader in automotive LiDAR, Hesai is exceptionally well-positioned to capitalize on these dynamic safety trends.

第三，我們預計，強制執行更高安全標準的法規的引入將對光達產業產生變革性影響。中國新推出的 L3 級自動駕駛政策和美國 NHTSA 的 AVB 速度要求等舉措，正在推動智慧駕駛技術的發展，並以前所未有的力度強調安全性。同時，越來越多的汽車製造商和消費者認識到光達配置是與安全帶或安全氣囊一樣重要的安全功能。身為汽車光達領域的全球領導者，合賽科技擁有得天獨厚的優勢，能夠充分利用這些動態的安全趨勢。

Last but not least, before I conclude, I'm delighted to announce that the publication of Hesai inaugural ESG report. This report highlights our efforts and accomplishments in ESG across our business operations and underscores our ongoing commitment to sustainable development. As a leader in automotive LiDAR industry, Hesai is delighted not only to elevating people's lives within cutting-edge LiDAR technology and products but also fostering greener and more sustainable operations.

最後，在結束之前，我很高興地宣布，Hesai 首份 ESG 報告已發布。本報告重點介紹了我們在業務運營中 ESG 的努力和成就，並強調了我們對永續發展的持續承諾。身為汽車光達產業的領導者，和賽不僅致力於透過尖端光達技術和產品提升人們的生活品質，而且還致力於促進更綠色、更永續的營運。

Moving forward, we'll continue to align our business goals with ESG best practices to ensure long-term value for our stakeholders and society. For more details on the ESG report, please visit our IR website.

展望未來，我們將繼續將業務目標與 ESG 最佳實踐相結合，以確保為我們的利害關係人和社會創造長期價值。有關 ESG 報告的更多詳情，請造訪我們的投資者關係網站。

In summary, we're poised to capitalize on emerging opportunities in the automotive industry, backed by our efficient operations, a robust financial foundation, and outstanding technological capabilities.

總而言之，憑藉我們高效的營運、雄厚的財務基礎和卓越的技術能力，我們已做好充分準備，把握汽車產業湧現的新機會。

As we look to the remainder of 2024 and beyond, we remain committed, driving innovations and providing top-tier LiDAR solutions that enhance vehicle safety and autonomous driving worldwide while adhering to our ESG objectives.

展望 2024 年剩餘時間及以後，我們將繼續致力於推動創新，提供一流的雷射雷達解決方案，以提高全球車輛安全性和自動駕駛能力，同時遵守我們的 ESG 目標。

This concludes our prepared remarks today. Operator, we're now ready to take questions.

我們今天的演講到此結束。接線員，我們現在可以開始回答問題了。

(Operator Instructions) Tim Hsiao, Morgan Stanley.

（操作說明）Tim Hsiao，摩根士丹利。

Morning, David. Thanks for taking my questions. I have two questions.

早安，大衛。謝謝您回答我的問題。我有兩個問題。

The first one, we noticed that Financial Times reported that the US Defense Department has decided to remove Hesai from the backlist. Could you please elaborate a bit more on the current developments and progress, and of course, the implication to your project wins and appreciating overseas because we think this is a very important milestone? So it'd be great if you can share more details. That's my first question. Thank you.

首先，我們注意到《金融時報》報道稱，美國國防部已決定將何賽從退休名單中移除。能否請您詳細介紹目前的發展和進展，當然還有這對您的專案在海外的成功和認可意味著什麼，因為我們認為這是一個非常重要的里程碑？如果您能分享更多細節就太好了。這是我的第一個問題。謝謝。

Thank you, Tim, and thank you for the question.

謝謝你，提姆，也謝謝你的提問。

And we have consistently maintained that our inclusion on the 1260H list was a mistake. Our products are strictly for commercial and civilian use, and we have no connection to any military bodies. We are not a vendor to any military bodies either. As we discussed in the previous earning calls, being on the DoD means strictly that the US Department of Defense aka the Pentagon cannot buy our product starting mid-2026, but to be honest, as far as we know, we've never sold anything to DoD or any military.

我們一直堅持認為，將我們列入 1260H 名單是一個錯誤。我們的產品嚴格用於商業和民用用途，我們與任何軍事機構沒有任何關聯。我們也不是任何軍方機構的供應商。正如我們在先前的財報電話會議上討論的那樣，加入國防部意味著美國國防部（即五角大廈）從 2026 年年中開始不能購買我們的產品，但說實話，據我們所知，我們從未向國防部或任何軍方出售過任何東西。

And we definitely don't plan in the future. Or in simple terms, we've never generated any revenue from DoD or any other military. And again, we don't expect to. However, being on the list did seriously impact our reputation, as you can see the stock price and also impeded some of the business opportunities over the past few months since we included. And again, to be honest, actually made things very tricky for some of the customers because they're worried that we might have ties to the Chinese military as that's what the list meant.

我們絕對不會制定未來計劃。簡單來說，我們從未從美國國防部或任何其他軍事機構獲得任何收入。我們再次重申，我們並不期望如此。然而，被列入名單確實嚴重影響了我們的聲譽，正如你所看到的股價所反映的那樣，而且自從我們被列入名單以來，過去幾個月裡，一些商業機會也受到了阻礙。說實話，這實際上給一些客戶帶來了很大的麻煩，因為他們擔心我們可能與中國軍方有聯繫，因為這份名單就是這個意思。

Unfortunately, it's hard to disapprove until DoD officially takes us off the list. And we will not be able to speak to the actual results until it's official. But by any chance, if we are removed, with our leading technology and the best-in-class financial strength, we are very optimistic that we will lock in more global deals. And this is the information we would like to share regarding the current status of the DoD.

遺憾的是，在國防部正式將我們從名單中移除之前，很難提出反對意見。在官方結果公佈之前，我們無法對最終結果發表評論。但萬一我們被淘汰，憑藉我們領先的技術和一流的財務實力，我們非常樂觀地認為我們將達成更多全球交易。以下是我們想與大家分享的有關國防部當前狀況的資訊。

Unfortunately, I will not be able to speak to the status of the Financial Times article because that's speculation of the case. And we definitely need to wait for the official notice, but I think it's more important that people understand our position, understand the facts, and also understand that we have been impeded by this inclusion. And if by any chance we are removed, we are extremely optimistic that a lot of the progress that was impeded and paused will be to removed and hopefully on accelerated path.

很遺憾，我無法就《金融時報》文章的進展發表評論，因為那是對此案的猜測。我們當然需要等待官方通知，但我認為更重要的是讓人們了解我們的立場，了解事實，也了解我們因為這項規定而受到阻礙。即使我們不幸被除名，我們也非常樂觀地認為，許多受阻和停滯的進展將會被消除，並有望走上加速發展的道路。

Does this answer your question, Tim?

提姆，這個回答能解答你的疑問嗎？

Yes, yes. Thanks for sharing all the details.

是的，是的。感謝您分享所有細節。

And my second question is currently, investor focus a lot on the robo-taxi. And David also shared quite a lot of updates during the presentation. But as we mentioned, I think Hesai was chosen by Baidu Apollo's next-generation robo-taxi as sole supplier across 11 cities. But if there's any further details, how should we think about the market opportunity? Because you also mentioned, in addition to Baidu Apollo, the top-notch robo-taxi operators or makers also want to do the business with us. You mentioned like four LiDAR up a car, with that kind of business as a boost of added content, how is like a potential assembly or software being integrated? In the meantime, for when do you think we are going to see the inflection point where more meaningful revenue uptick? Can it be next year or the year after or we are going to see some progress later this year? So that's my second question. Thank you.

我的第二個問題是，目前投資人非常關注無人駕駛計程車。大衛在演講中也分享了許多最新消息。但正如我們所提到的，我認為百度Apollo的下一代無人駕駛計程車選擇何賽作為其在11個城市的唯一供應商。但如果還有其他細節需要說明，我們該如何看待市場機會？因為你也提到，除了百度Apollo之外，頂尖的無人駕駛計程車業者或製造商也想和我們合作。你提到在一輛車上安裝四個雷射雷達，這種業務模式可以增加內容，那麼潛在的組件或軟體是如何整合的呢？同時，您認為我們何時才能看到營收出現更顯著成長的轉折點？是明年還是後年？或者今年稍晚我們就能看到一些進展？這是我的第二個問題。謝謝。

Thank you, Tim. I will answer the first part. I think, for first -- with second, I missed your question on the software side and which I might have to ask you to ask again, but let me first take on the question of the business development of the robo-taxi.

謝謝你，提姆。我將回答第一部分。我認為，首先——至於其次，我錯過了你關於軟體方面的問題，我可能不得不請你再問一遍，但首先讓我來回答一下關於無人駕駛出租車業務發展的問題。

I think it's fair to say that we are the biggest robo-taxi LiDAR supplier in the world by many measures. And in China, we are the exclusive -- the main perception LiDAR supplier of the top five robo-taxi supplier and most people believe that we have a product that's way superior than the peers, and including Baidu Apollo Go, right?

我認為，從很多方面來看，我們都是全球最大的自動駕駛計程車雷射雷達供應商，這個說法應該沒有錯。在中國，我們是排名前五的自動駕駛計程車供應商的獨家主要感知雷射雷達供應商，大多數人認為我們的產品比同行（包括百度Apollo Go）要好得多，對吧？

And based on that Yole's repost for 2023, we have a 74% market share of the global LiDAR market for robo-taxi, as we, I think, have been communicated. And historically, those people use mechanical as being LiDAR. And now as you see, as we are scaling up, a lot of people are adopting ADAS AT128, again, including Baidu Apollo, which is a very interesting transition as we see because AT128 is a new sensor that we've shipped hundreds of thousands of, and it's a very powerful, much more affordable sensor.

根據 Yole 對 2023 年的預測，我們在全球無人駕駛計程車雷射雷達市場中佔有 74% 的市場份額，我想我們已經了解到了這一點。從歷史上看，這些人把機械方式稱為光達。現在正如你所看到的，隨著我們規模的擴大，很多人都在採用 ADAS AT128，包括百度 Apollo，這是一個非常有趣的轉變，因為 AT128 是一款我們已經出貨數十萬個的新型感測器，它是一款功能強大、價格更實惠的感測器。

And I think this actually helps the customer to achieve a better balance between price and performance. At this point to me, the biggest inflection is more commercial than technological because technological advancement has always been continued -- continuously advancing .

我認為這實際上有助於客戶在價格和性能之間取得更好的平衡。在我看來，目前最大的轉捩點更多是商業方面的而非技術方面的，因為技術進步一直都在持續進行。。

Well, this year is the first year, most people are talking about commercialization in the sense that you need to look at a total cost of the equipment, you need to look at amortization, in the end, you come to a business case in which if your sensors are still worth tens of thousands of dollars each as used to, it's tricky for people to do that. And that's why we are working very closely with robo-taxi people to do that.

嗯，今年是第一年，大多數人都在談論商業化，這意味著你需要考慮設備的總成本，你需要考慮攤銷，最終你會得出商業案例，如果你的感測器仍然像以前一樣每個價值數萬美元，那麼人們很難做到這一點。所以，我們才與自動駕駛計程車領域的人員密切合作來實現這一目標。

And by the way, it's one of the examples. And those are not the only one, by the way. Many other robo-taxis have also adopted a similar plan. So as a result, what we see is that we start to receive significantly larger LiDAR orders for robo-taxis for the years to come, as some of them have already been locked in. And as we expect this market to grow and we expect the customers to move from a smaller scale -- high price mechanical LiDARs with a larger scale ADAS LiDAR.

順便說一句，這只是其中一個例子。順便說一句，這些還不是全部。其他許多無人駕駛計程車也採用了類似的方案。因此，我們看到，未來幾年我們將收到更多用於無人駕駛計程車的光達訂單，因為其中一些訂單已經確定下來。我們預計這個市場將會成長，並且我們預期客戶會從小規模、高價格的機械式雷射雷達轉向大規模的ADAS雷射雷達。

And also international robo-taxi players are still focusing on the performance. So they are still focused on the mechanical LiDAR, which is the more high priced and a more -- much higher margin business for us. And so this is on the business part.

此外，國際自動駕駛計程車廠商仍在專注於提升性能。所以他們仍然專注於機械式雷射雷達，這對我們來說是價格更高、利潤更高的業務。以上就是商業方面的內容。

And I guess I remember you had a question on that software. Can you repeat that so that I can clearly answer.

我好像記得你之前問過關於那個軟體的問題。請你再重複一遍，好讓我能清楚回答。

Sure. Sure. So basically, just wanted to tell that if there would be any differences between our business with robo-taxi maker and the traditional carmaker. So in robo-taxi's case, because we are going to provide like [announcement] LiDARs. So just wondering if there will be any potential upside to the value content?

當然。當然。所以，我主要是想說明一下，我們與自動駕駛計程車製造商的業務和與傳統汽車製造商的業務之間是否存在任何差異。所以就無人駕駛計程車而言，因為我們將提供類似[公告]雷射雷達的設備。所以我想知道，這種高價值的內容是否有任何潛在的提升空間？

So in addition to your LiDAR, Hesai also provide like assembly services or together with some additional software to facilitate their robo-taxi. And so, in short, will there be any value content upside in addition to the LiDAR you sell?

因此，除了光達之外，合賽還提供組裝服務或一些額外的軟體來協助其無人駕駛計程車的開發。簡而言之，除了您銷售的光達之外，是否還有其他增值內容？

Okay. So your question is to (inaudible) we make more money from them by not only selling the hardware but also selling the software, right? So the quick answer is I believe it's a different business model in a sense that we do provide a lot of tools. We're trying to stay away from data per se, but we do provide tools for installation and calibration, stitching different point cloud into one panorama image. And those are the tools we have, but instead of targeting them separately, we think the business model is that we provide them with the software as part of the hardware package.

好的。所以你的問題是（聽不清楚）我們不僅透過銷售硬件，還透過銷售軟體賺取更多利潤，對嗎？所以簡單來說，我認為這是一種不同的商業模式，因為我們提供了許多工具。我們盡量避免直接使用數據，但我們確實提供了安裝和校準工具，可以將不同的點雲拼接成一張全景影像。這就是我們擁有的工具，但我們認為，與其單獨針對這些工具，不如將軟體作為硬體包的一部分提供給他們，這樣才是更合理的商業模式。

And that way allows us to have a better margin and a better -- a more competitive product. So in other words, that's already embedded in. That is one of our advantages of being able to cater to this market with a better offering.

這樣一來，我們就能獲得更高的利潤率和更好的產品——更具競爭力的產品。換句話說，這已經包含在其中了。這是我們能夠以更好的產品和服務來迎合這個市場的優勢之一。

Let me clarify on that. I think Hesai's key focus is exclusively on supplying LiDAR hardware and not the software. I think we are very strict about -- we never have any data security or privacy risks that can be caused because we never transmit data wirelessly. We do not, you know, start even a second of the point cloud and we only supply the LiDAR hardware but not the software. I think that's key.

讓我解釋一下。我認為Hesai的主要關注點在於提供光達硬件，而不是軟體。我認為我們在這方面非常嚴格——我們從不進行無線資料傳輸，因此不存在任何可能造成的資料安全或隱私風險。你知道，我們甚至連一秒鐘的點雲數據都不採集，我們只提供光達硬件，但不提供軟體。我認為這一點至關重要。

I would -- I'll give you another example that I consider as analogous. If you think about, for example, Apple, right, they sell you cellphone. Technically, they could charge you for the iOS system or if you look at your MacBook, they could charge you for the MacOS system. They never do that. They just sell you a work-centered hardware because most people now don't have the habit of buying a separate set of software for the hardware, even though they go together. I think the software is served as a higher barrier and a better user experience for the hardware part. I mean, that's kind of the philosophy we're following.

我會——我再舉一個我認為類似的例子。例如，想想蘋果公司，對吧？他們賣手機給你。從技術上講，他們可以向你收取 iOS 系統的費用；或者，如果你看看你的 MacBook，他們也可以向你收取 MacOS 系統的費用。他們從來不會那樣做。他們只是向你推銷以工作為中心的硬件，因為現在大多數人沒有習慣為硬體單獨購買一套軟體，即使它們是配套的。我認為軟體為硬體部分提供了更高的門檻和更好的用戶體驗。我的意思是，這大概就是我們所遵循的理念。

Tina Hou, Goldman Sachs.

Tina Hou，高盛集團。

Good morning, David and Yuanting. Thanks for taking my questions. So I have two questions. The first one is regarding the robo-taxi LiDAR. So you report autonomous mobility LiDAR shipment separately, but now I understand that would include the AT128 LiDAR as well, right?

早安，David 和 Yuanting。謝謝您回答我的問題。我有兩個問題。第一個問題與無人駕駛計程車的光達有關。所以你們單獨報告了自動駕駛光達的出貨量，但我現在理解這其中也包括 AT128 光達，對嗎？

So just wondering like how much of that our 5,700 is AT and then the rest is Pandar. Could you give us like a breakdown? And then also for the AT128 that you sell to the robo-taxi customers, is it the same pricing and margin as you sell to the EV OEMs?

所以我想知道，我們這 5700 塊地有多少是 AT 的，剩下的又有多少是 Pandar 的。能給我們詳細解釋一下嗎？另外，你們賣給自動駕駛計程車客戶的 AT128 的價格和利潤率是否與賣給電動車 OEM 廠商的價格和利潤率相同？

So that is a good question. So as we've said, you know, currently within the Chinese market, we are seeing a trend where our Chinese robo-taxi players, when they will like to commercialize their business, they're switching from the transitional mechanical spring LiDARs to adopt the ADAS LiDARs. And as a result, we have received significantly larger LiDAR orders for use in robo-taxis for the years to come. That means that the big order will be splitted into several years and we will record the ADAS LiDARs to these type of Chinese robo-taxi players in the coming years.

這確實是個好問題。正如我們所說，目前在中國市場，我們看到一種趨勢，即中國的無人駕駛計程車企業在想要實現業務商業化時，正在從過渡性的機械彈簧雷射雷達轉向採用ADAS雷射雷達。因此，未來幾年我們將收到更多無人駕駛計程車的光達訂單。這意味著大訂單將分幾年交付，我們將在未來幾年內為這類中國無人駕駛計程車公司提供 ADAS 雷射雷達。

So holistically, I think on the robo-taxi side in China, we can expect that they are moving from the smaller scale, higher price mechanical LiDARs to larger scale ADAS LiDARs, and that will boost our revenue and gross profit in the long run after robo-taxi business grow in China.

因此，總的來說，我認為在中國的無人駕駛出租車領域，我們可以預期他們正在從規模較小、價格較高的機械式激光雷達轉向規模較大的ADAS激光雷達，這將在中國無人駕駛出租車業務增長後，從長遠來看提高我們的收入和毛利潤。

And with regard to your second question, are we having the higher price? Are we having the higher margins for the ADAS LiDAR we sell to the robo-taxi players in China? The answer is yes. Because the amounts they are buying from us is not as significant as the passenger car OEMs they're buying from us. So basically, they will enjoy, of course, a relatively better price. And of course, we are selling the ADAS LiDAR to them with the same costs, so the margin will be relatively better as well. So that's why I'm saying that will boost our revenue and gross profit for the long run.

至於你的第二個問題，我們的價格是不是比較高？我們向中國自動駕駛計程車公司銷售的ADAS雷射雷達是否獲得了更高的利潤率？答案是肯定的。因為他們從我們這裡購買的數量不如他們從我們這裡購買的乘用車OEM產品那麼多。所以基本上，他們當然會享受到相對較優惠的價格。當然，我們向他們銷售 ADAS 光達的成本不變，因此利潤率也會相對較高。所以這就是為什麼我說這將從長遠來看提高我們的收入和毛利。

Yeah, so the other angle to look at it is that to us, because they're buying the identical product, and in the end, the pricing is strictly tied to volume, right? If you kind of can look at the ADAS volume, usually, we're in the range of 100 to 1,000 units a year. Well, clearly, robo-taxi isn't there. So that's why they have to pay for a higher price and has the volume in the near. But having said that, the long-term frame agreements we have with different robo-taxi makers is such that by the time they reach similar level range -- range level as the ADAS product, the price to them will be also go to the ADAS product. So it is the nature of such a business.

是的，從另一個角度來看，對我們來說，因為他們購買的是相同的產品，最終價格與銷售完全掛鉤，對吧？如果你看ADAS的產量，通常來說，我們每年的產量在100到1000台之間。顯然，無人駕駛計程車還沒出現。所以這就是為什麼他們要支付更高的價格，並且近期銷量會很高的原因。但話雖如此，我們與不同的無人駕駛計程車製造商簽訂的長期框架協議規定，當它們的續航里程達到與 ADAS 產品類似的水平時，它們的價格也會向 ADAS 產品靠攏。這就是這類行業的本質。

And financially, I think it's an equation, right? It's about a price you have, multiplied by the volume you have, then multiplied by the gross margin you have. And so based on this equation, I think in the long run, you know, having the ADAS LiDAR shipped to our larger amounts of robo-taxi players and that will help -- to help them commercialize their business. And in the end, the equation for us, I think, will be beneficial for us financially as well.

從財務角度來看，我認為這就像一個等式，對吧？這牽涉到你的價格乘以你的銷量，然後再乘以你的毛利率。因此，根據這個等式，我認為從長遠來看，將 ADAS LiDAR 運送給更多無人駕駛計程車公司，這將有助於——幫助他們實現業務商業化。最終，我認為這對我們來說，在經濟上也是有利的。

Thank you. That's very clear. Makes a lot of sense.

謝謝。這一點很清楚。很有道理。

Second question is regarding your gross margin because the second-quarter gross margin has improved quite a lot from first quarter. So could you give us a breakdown in terms of the factor for the improvement? How much is from product mix? How much is from like scale benefits?

第二個問題是關於你們的毛利率，因為第二季的毛利率比第一季有了很大的提高。那麼，您能否詳細分析促成這項改進的因素？產品組合中佔比多少？規模經濟能帶來多少收益？

And also, as David mentioned, the ADAS LiDAR gross margin has also significantly improved, so just wondering like how much difference is there between the ADAS gross margin and autonomous growth margin now. And maybe too many questions on gross margin as well. So as you guided for 3Q and 4Q gross margin at 40%, so wondering why is it lower than our second-quarter margin. And lastly, how should we think about gross margin in 2025? Thank you.

另外，正如David所提到的，ADAS LiDAR的毛利率也顯著提高，所以我想知道現在ADAS的毛利率和自動駕駛毛利率之間有多大差距。或許關於毛利率的問題也太多了。既然您之前預測第三季和第四季的毛利率為 40%，那麼我想知道為什麼我們的毛利率低於第二季的毛利率。最後，我們該如何看待 2025 年的毛利率？謝謝。

Thank you. Yeah, there are many mini questions in this. So I will try to give you the top-level thinking and maybe we can have a more interactive discussion based on this.

謝謝。是的，這裡面有很多小問題。所以我會盡量從宏觀的角度出發，給大家闡述我的想法，或許我們可以在此基礎上展開更深入的討論。

The first is that despite the downstream adjustments to accommodate the postponed SOP timeline for certain clients, our ADAS ASP will remain relatively stable within a year. The pricing was negotiated at the time of the contract and signed typically fixed for the year.

首先，儘管為了適應某些客戶推遲的 SOP 時間表而對下游進行了調整，但我們的 ADAS ASP 在一年內仍將保持相對穩定。價格在簽訂合約時協商確定，通常簽訂的合約規定一年內價格固定不變。

The mechanical LiDAR, each specific product also remains stable because most people recognize as being by far the best mechanical LiDAR on the market. And then you're right that we had a 45% gross margin blended in 2Q, highlighting financial strength and it's definitely the resilience of the business despite some of the shorter-term headwinds.

機械式光達的每個特定產品也保持穩定，因為大多數人認為它們是目前市場上最好的機械式光達。你說得對，我們第二季的毛利率達到了 45%，這凸顯了公司的財務實力，也充分體現了公司儘管面臨一些短期不利因素，但依然展現出的韌性。

I think one thing I wanted to point out is that our quarterly gross profit total is more than RMB200 million. That's roughly 3 times that of the next to highest publicly listed competitor on the global side. And I think a few reasons. One is our cost management effort has paid off because we upgraded AT128 featuring a more integrated design along with improvement of our in-house ASICs. I think that's one of the biggest factors.

我想指出的一點是，我們季度毛利總額超過人民幣2億元。這大約是全球排名第二的上市競爭對手的3倍。我認為原因有幾個。一方面，我們的成本管理努力取得了成效，因為我們對 AT128 進行了升級，採用了更整合的設計，同時改進了我們內部的 ASIC。我認為這是最重要的因素之一。

And the other one is definitely we're benefiting from the economies of scale as we ramp up the shipments, and also, we were able to take advantage of that to drive down materials and the manufacturing costs. And there is also -- I have to say there is also a one-off high margin service fee aka NRE from one of the global leading OEM in the second quarter, which is very helpful on the gross margin side, because it's the service revenue. So these are the status of it.

另一個好處是，隨著出貨量的增加，我們肯定受益於規模經濟，而且，我們也能夠利用這一點來降低材料和製造成本。此外，我還必須指出，第二季度還有來自全球領先的 OEM 廠商的一次性高利潤服務費（即非經常性工程費用），這對毛利率方面非常有幫助，因為這是服務收入。這就是它目前的狀態。

And looking ahead, I think we initially guided a blended gross margin of -- to the higher end of 30% to 35% range for the full year. We now expect the margin for Q3 and Q4 to be closer to 40%.

展望未來，我認為我們最初預計全年綜合毛利率將達到 30% 至 35% 區間的較高水準。我們現在預計第三季和第四季的利潤率將接近 40%。

But to be honest, we are not aware of any other player in the global LiDAR industry that can match our financial strength at the level of the revenue and the number of units we deliver, which is already at scale. And with effective expense controls and optimized operational efficiencies, our OpEx is expected to grow 10% to 15% compared to the full year of 2023. And these initiatives bring us closer to achieving profitability in the fourth quarter of the year.

但說實話，我們並不認為全球雷射雷達行業中還有其他任何一家公司能夠在收入水平和交付量方面與我們匹敵，而我們的交付量已經達到了規模化水平。透過有效的費用控制和優化的營運效率，預計我們的營運支出將比 2023 年全年增長 10% 至 15%。這些舉措將使我們離今年第四季獲利的目標更近一步。

We are also optimistic about approaching non-GAAP breakeven for the second half of 2024. And these are what we expect for the future and also the current status of the year.

我們也樂觀地認為，公司將在 2024 年下半年接近非 GAAP 損益平衡點。這些都是我們對未來的預期，也是今年的現狀。

So in short, our gross margin will be very robust. We delivered 45% into 2Q and we are expecting Q3 and Q4 to be closer to the 40%. You mentioned while there will be a QoQ slightly declined by -- from 45% to 40%, it is because we recorded a one-off high margin services revenue during the second quarter, as David mentioned. However, on the other side, if you look at the trust management capability we have, if you look at the economies of scale benefits we are enjoying, the 40% level of the gross margin is probably very leading position in the industry.

簡而言之，我們的毛利率將非常穩健。第二季我們交付了 45%，預計第三季和第四季將接近 40%。您提到，雖然環比略有下降（從 45% 降至 40%），但這是因為正如 David 所提到的，我們在第二季度獲得了一筆一次性的高利潤服務收入。然而，另一方面，如果你看看我們擁有的信任管理能力，看看我們正在享受的規模經濟效益，40% 的毛利率在業界可能處於非常領先的地位。

And if we look at the gross profit, in absolute value, we have recorded more than RMB200 million in 2Q alone. I think we can -- as of now, we are not aware of anyone else in the industry actually have this kind of financial strengths and that is helping us to garner a lot of deals from other passenger car OEMs as well because the best-in-class financial strength, they have more confidence in us, to partner with us in the following years to come.

如果我們看一下毛利的絕對值，光是第二季我們就錄得超過人民幣2億元。我認為我們可以做到——就目前而言，我們還沒有發現業內其他任何公司擁有如此雄厚的財力，這也有助於我們從其他乘用車製造商那裡獲得很多訂單，因為我們擁有業內領先的財力，他們對我們更有信心，願意在未來幾年與我們合作。

Does that help you understanding the gross margin fluctuation?

這樣能幫助你理解毛利率波動嗎？

Yes, very helpful. Thank you.

是的，很有幫助。謝謝。

Jessie Lo, Bank of America Security.

Jessie Lo，美國銀行保全部門。

Hi, David and Yuanting. Thank you for taking my question. My first question you sort of just answered just now because I was wondering that we have already iterate our breakeven for the fourth quarter of this year. And then you just mentioned that we are targeting the non-GAAP breakeven second half of 2024. I'm just making sure that I have heard it correct.

嗨，David 和 Yuanting。感謝您回答我的問題。我的第一個問題你剛才其實已經回答了，因為我想知道我們是否已經計算了今年第四季的損益平衡點。然後您剛才提到，我們的目標是在 2024 年下半年實現非 GAAP 收支平衡。我只是想確認一下我沒聽錯。

Excuse me, Jessie, would you mind repeat your question? (multiple speakers)

傑西，請問您能再說一次您的問題嗎？（多位發言者）

We answered that already. Is there a new question?

我們已經回答過這個問題了。還有其他問題嗎？

Is that about the breakeven timeline? I think we just answered that question when Tina bring the question.

這是指損益平衡時間表嗎？我覺得蒂娜提出這個問題的時候，我們已經回答過這個問題了。

Yeah, yeah. Sure, sure.

是啊是啊。當然，當然。

And then I would like to ask about, you know, as Exxon mentioned that they will not use LiDAR. going forward. Of course, they are not in need for clients as of now. But then we were just wondering that would it be a good chance that other (inaudible) will try to follow what they're doing on the technology side because what we see is very diverse for us. We are seeing a lot of orders coming in LiDAR side inches, a lot of sampling with our clients. But on the other hand side, they are still, as you've seen, someone decide not to use and then -- I guess, they have their own reasons as well. So how do you see this result in the future?

然後我想問一下，正如埃克森美孚所提到的，他們未來將不再使用光達。當然，他們目前並不需要客戶。但我們當時就在想，其他（聽不清楚）是否會有很好的機會效法他們在技術方面的做法，因為我們看到的是非常多元的。我們看到很多訂單都是以 LiDAR 側向英吋為單位的，我們也需要為客戶進行許多樣品測試。但另一方面，正如你所看到的，有些人決定不使用它們，我想，他們也有自己的理由。那麼，您如何看待這項結果在未來會如何發展？

So may I clarify your question, if you are asking about the domestic project pipeline?

那麼，請問您的問題是否與國內專案儲備有關？

I am asking about Exxon. They are not using -- they decide not to use the LiDAR on their future models and then there're other OEM (technical difficulty) in the future trying to follow or copy what they're doing right now.

我問的是埃克森美孚公司的情況。他們決定不在未來的車型中使用光達，而未來其他 OEM 廠商（由於技術困難）可能會試圖效仿或複製他們現在的做法。

So let me make sure [under] your question.

所以，讓我確認一下你的問題。

So you're asking about the question about Tesla's vision-only solution and extend switching from LiDAR solution to non-LiDAR. Am I correct?

所以你是在問關於特斯拉的純視覺解決方案的問題，以及從光達解決方案切換到非光達解決方案的問題。我說的對嗎？

Yes, yes, and then, of course, that does not impact us. But then what if other OEM trying to copy or like -- what they're trying to do right now?

是的，是的，當然，那對我們沒有任何影響。但如果其他 OEM 廠商試圖複製或效仿他們現在正在做的事情呢？

Oh, yeah. Sure, sure.

哦，是的。當然，當然。

The Tesla question is the same question as it is before, right? The one thing I think people should pay closer attention is that there has been a publication by the Wall Street Journal, and they've been listing out a lot of the publicly available sources on the different technological challenges on the safety side Tesla has. And definitely, some of them could have been avoided with a LiDAR.

特斯拉的問題和以前一樣，對吧？我認為人們應該更加關注的一點是，《華爾街日報》發表了一篇文章，列舉了許多公開資料，闡述了特斯拉在安全方面面臨的各種技術挑戰。而且，其中一些事故肯定可以透過光達避免。

I think even though it's public data, it was very interesting for people to collect them in such a way and to see, oh, it's a much more intuitive image for us to understand LiDARs as the seat belt or the airbag.

我認為，儘管這些數據是公開的，但以這種方式收集它們非常有趣，而且讓我們看到，哦，這讓我們更容易直觀地理解雷射雷達就像安全帶或安全氣囊一樣。

And the other fact I want to point out is that in my mind, Tesla/a lot of the carmakers today, they're shipping Level 2 or Level 2 Plus Plus systems, which -- ultimately, it's on human, right? It's not on the machine. Well, clearly, there have been lot of efforts globally for sure and also in China that the industry is moving towards Level 3. The nature of Level 3 is you need redundant measures to achieve that level off functional safety.

我想指出的另一點是，在我看來，特斯拉/如今很多汽車製造商都在交付 L2 或 L2 Plus Plus 系統，而最終，這還是取決於人，對吧？機器上沒有。顯然，全球範圍內，包括中國在內，都做出了很多努力，推動產業邁向3級。3 級功能的本質在於，需要採取冗餘措施才能達到該等級的功能安全。

Functional safety meaning that you need the redundancy to have different ways to measure the same result or same object, and that requires a LiDAR, and -- at least, that's what we see almost every other global OEM and the vast majority of the OEMs in China when they develop a Level 3 system.

功能安全意味著你需要冗餘來用不同的方法來測量相同的結果或相同的對象，這需要光達，而且——至少，我們看到幾乎所有其他全球 OEM 和絕大多數中國 OEM 在開發 L3 系統時都是這樣做的。

So the message is that, A, look at Tesla’s recent accidents; B, for Level 3 globally, everybody else agreed you need a LiDAR. Look at China Level 3, everybody agrees you need a LiDAR. For Level 2, some people think you could save that money. But even with that, we're making that affordable enough that most people are widely adopting that and a lot of the players decided to make it standard configuration moving forward. And so this is really the status of the industry.

所以，傳遞的訊息是：A，看看特斯拉最近發生的事故；B，對於全球範圍內的 L3 級自動駕駛，其他所有人都同意你需要雷射雷達。看看中國的L3級測速系統，大家都一致認為需要光達。對於二級水平，有些人認為你可以省下這筆錢。但即便如此，我們仍然努力讓它價格親民，以至於大多數人都廣泛採用，而且許多玩家決定將其作為未來的標準配置。這就是該行業的真實現況。

Yeah, sure. Thank you so much. And then, second -- I still have one more question, which is our previously guided third-quarter shipments to be under 50,000, fourth quarter 200,000, and then full year at 500,000. Would that have any update? And if you could, could you sort of shed some light on -- to client [trade down] as well, [for example, new versus their past]?

當然可以。太感謝了。其次，我還有一個問題，那就是我們先前預測的第三季出貨量將低於 5 萬件，第四季為 20 萬件，全年為 50 萬件。請問有任何更新嗎？如果可以的話，您能否也解釋一下──對於客戶而言（降級交易）也是如此？例如，新的與過去的對比？

Sure. I can take that question. So for the second half of '24, we are now expecting 300,000 to 350,000 shipments in the second half of the year. And this is due to downstream adjustments like certain ADAS clients where some of their models have been pushed out to early next year.

當然。我可以回答這個問題。因此，我們預計 2024 年下半年的出貨量將達到 30 萬至 35 萬件。這是由於下游調整所致，例如某些ADAS客戶的部分車款被推遲到明年年初推出。

However, on the other side, we are seeing two trends. The first trend is that our ATX has garnered significant interest among the domestic OEMs. And as we stated in the earnings is that we have already secured several OEMs for our ATX products already.

然而，另一方面，我們看到了兩種趨勢。第一個趨勢是，我們的 ATX 主機板已經引起了國內 OEM 廠商的極大興趣。正如我們在財報中所述，我們已經為我們的 ATX 產品找到了幾家 OEM 廠商。

And the second trend is that we have noticed that in China, especially recently, there has been a growing trend where the domestic OEMs are also moving towards Level 3 standards. So they are requesting for even better performance of the ADAS LiDAR. So like we said in the earnings that one of the leading EV maker has already signed the agreements with us to adopt our next-generation ultra-high performance ADAS LiDAR for all of their new models scheduled to SOP in 2025.

第二個趨勢是，我們注意到，在中國，尤其是最近，國內的汽車製造商也朝著3級標準邁進，這已成為日益增長的趨勢。因此，他們要求ADAS雷射雷達具有更好的性能。正如我們在財報中所說，一家領先的電動車製造商已經與我們簽署了協議，將在其所有計劃於 2025 年上市的新車型上採用我們的下一代超高性能 ADAS 雷射雷達。

And we believe that this will open the gates for others to follow as well for these ultra-higher performance like ours. And so as we offer both ultimate performance and also ultimate value to cost products, we are seeing some clients that have decided to switch from our competitor to us. So that's why we are -- we will be anticipating very strong and solid order pipelines in 2025 and 2026. And in 2024, as we stated, because of the pushouts for certain models from the clients, we are guiding a 300,000 to 350,000 for the second half of the year.

我們相信，這將為其他廠商效仿，打造像我們這樣性能超高的超高性能產品打開大門。因此，由於我們既提供性能卓越的產品，又提供性價比極高的產品，我們看到一些客戶決定從我們的競爭對手轉而選擇我們。所以這就是為什麼我們預計 2025 年和 2026 年將有非常強勁且穩定的訂單管道。正如我們之前所說，由於客戶推遲了某些型號的交付，我們預計 2024 年下半年的產量將達到 30 萬至 35 萬。

[Zhang Hui], Huatai Securities.

[張輝]，華泰證券。

Good morning, Yuanting and David. With ATX about to go on the market, my first question is, do you know what's the difference between ATX and AT128 for [203] and what impact was gross margin?

袁婷和戴維，早安。ATX即將上市，我的第一個問題是，您知道ATX和AT128之間有什麼不同嗎？ [203] 毛利率受到了什麼影響？

(spoken in foreign language)

（用外語說）

That's a good question. Thank you, Zhang Hui. So our ATX is a high value-to-cost low-range ADAS LiDARs and comparing with AT128, I think, the key point is that it's having a very reasonable price, of course. And unlike similar products, from our competitors that sacrifice performance for their, you know, lower-priced ADAS LiDARs, our ATX offers both performance upgrades and cost efficiencies. And that's why we are securing a bigger number of, you know, partnerships on the OEM.

這是個好問題。謝謝你，張輝。因此，我們的 ATX 是一款性價比很高的低距離 ADAS 雷射雷達，與 AT128 相比，我認為關鍵在於它的價格非常合理。與競爭對手的類似產品不同，我們的 ATX 產品在提供性能提升的同時，也提高了成本效益，而競爭對手的產品為了降低 ADAS 雷射雷達的價格，犧牲了性能。這就是為什麼我們要爭取更多與原始設備製造商 (OEM) 建立合作關係的原因。

So since its launch, we have seen that the ATX has secured design wins with several major OEMs by the second quarter as we start. And the SOP timing for ATX, we expect that it will begin in the first quarter of next year with significantly larger volumes expected in 2026 as well.

自推出以來，我們看到，截至第二季初，ATX 已經贏得了幾家主要 OEM 廠商的設計訂單。至於 ATX 的 SOP 時間安排，我們預計將於明年第一季開始，預計 2026 年銷售量也將大幅成長。

And we anticipate that it will penetrate into a broader range of vehicle pricing segments with small models featuring it as a standard configuration and further driving our flywheel of scale and cost optimization. Because of this, I think the gross margin for the ATS product will be rather reasonable. Even though we didn't specifically disclose for them, gross margins will have.

我們預計它將滲透到更廣泛的車輛價格區間，小型車型將以該技術作為標準配置，從而進一步推動我們的規模和成本優化飛輪效應。因此，我認為ATS產品的毛利率會相當合理。雖然我們沒有特別揭露，但毛利率肯定會有變化。

Okay, thank you. And my second question is what do you see other competitors that they have within the order for the robo-taxis LiDAR? Could you tell us more about the -- for the robot [hold], do you some robotics order? Thank you.

好的，謝謝。我的第二個問題是，您認為他們在無人駕駛出租車雷射雷達訂單方面還有哪些其他競爭對手？能詳細介紹一下機器人[保持]的情況嗎？您是否訂購了一些機器人？謝謝。

You are talking about the robotics, right?

你指的是機器人技術，對吧？

Yeah. (spoken in foreign language)

是的。（用外語說）

Right. So the question is do we have a specific product for robotics industry. And depending on the definition of robotics, we always had -- now ADAS sensors, for example, (inaudible), they wouldn't offer ADAS products. So we always had that. And having said that, we do recognize that there have been a lot more embodied AI and robotics applications who would benefit from even more miniaturized product with a lower price point. And so we are looking into that.

正確的。所以問題是，我們是否有專門針對機器人產業的專用產品？根據機器人技術的定義，我們一直都有──例如，現在的ADAS感測器，（聽不清楚），他們不會提供ADAS產品。所以我們一直都有這個。話雖如此，我們也意識到，還有很多實體人工智慧和機器人應用會受益於價格更低、體積更小的產品。所以我們正在調查此事。

And we do have a lot of interest and some of the orders already at a reasonably large scale and from the non-ADAS industry. But we don't have plans to disclose their names yet, but we have been aggregating them into the generic robotics sector, or else -- and now ADAS sector.

我們確實收到了很多關注，並且已經收到了一些相當大的訂單，這些訂單來自非ADAS行業。但我們目前還沒有計劃透露他們的名字，但我們一直將他們歸類到通用機器人領域，或者——現在又歸類到 ADAS 領域。

Yeah, I think industrial robotics has always been part of our AM business. And remember that we are the global leader in AM, capturing most of the market worldwide. And all thanks to the best performance of our mechanical spinning LiDARs. For example, if I look at the recent news in July, we just signed a deal with Westwell to speed up the global expansion in AD for logistics. And our LiDARs can, of course, be used in many kinds of robotics applications, namely logistics, mining trucks, last-mile delivery, robotics, electronics, even human -- robotics in the future potentially. We see huge growth opportunities ahead, I will say. And then also, stay tuned for our IAA event in Germany in September this year.

是的，我認為工業機器人一直是我們積層製造業務的一部分。請記住，我們是增材製造領域的全球領導者，佔據了全球大部分市場份額。這一切都要歸功於我們機械旋轉式光達的卓越性能。例如，如果我看一下 7 月的新聞，我們剛剛與 Westwell 簽署了一項協議，以加快 AD 物流的全球擴張。當然，我們的雷射雷達可以應用於多種機器人應用領域，例如物流、礦用卡車、最後一公里配送、機器人、電子產品，甚至未來也可能應用於人機互動領域。我認為，我們未來將迎來巨大的成長機會。此外，請關注我們今年9月在德國舉辦的IAA活動。

[Jackie Zhong], CICC.

[鐘傑]，中金公司。

Management team, thank you for taking my questions. I’m Jackie Zhong from CICC. So congratulations on this quarter results. I have two question to ask.

管理團隊，感謝你們回答我的問題。我是來自中金公司的鐘嘉琪。恭喜你們取得本季的良好業績。我有兩個問題想問。

The first one is regarding to the Level 3. Just now mentioned that Level 3 requires certain level of redundancy. So I want to go to more specific regarding the conditions. So are there any scenarios or conditions that can only be met with LiDAR so that make LiDAR a factor to our Level 3? Thank you.

第一個問題與3級有關。剛才提到過，3級需要一定程度的冗餘。所以我想更具體地說明一下情況。那麼，是否存在只有光達才能滿足的場景或條件，使得光達成為我們3級自動駕駛的因素？謝謝。

Yeah, that is a very good question in a sense that if you think about Level 3 and the function of safety requires that. First, you need to have multiple measures of the same mark check in case one fails, right? That's the nature of such assistance. And then, directly to your question, where we see the best use of LiDAR being the one that stepped up one camera sale. There are two main scenarios. And those are not hypothetical cases. Those are the data we see from the 100, 200 of sensors which have shipped and the one that are operating on the road, we get those feedbacks.

是的，從某種意義上說，這是一個很好的問題，因為如果你考慮 3 級安全功能，你就會明白這一點。首先，你需要對同一指標進行多道測試，以防一道測試失敗，對吧？這就是此類援助的本質。然後，直接回答你的問題，我們認為 LiDAR 的最佳用途是促進了一台相機的銷售。主要有兩種情況。這些並非假設案例。這些是我們從已發貨的 100 到 200 個感測器以及正在路上運行的感測器中獲得的數據，我們得到了這些回饋。

One is -- they call that general objects. And for EV functions, if you have an object like a truck laid down sideways on a highway or an unidentified object, lots to cargo that type of object, your network training would require your system to have seeing such an object in a path to be able to recognize that. That's one.

其中之一是──他們稱之為一般物件。對於電動車功能，如果高速公路上出現側翻的卡車或不明物體，或者有很多貨物需要裝載這類物體，那麼網路訓練將要求系統能夠識別路徑上的此類物體。這是其中之一。

The other is generally at night. Again, I encourage you to look into the Wall Street Journal datasets, which I think, they include more than 200 cases. And if you look at those cases, a lot of them are generally in the change of lighting condition, especially in darkness or in or out of the tunnels in which your computer vision is struggling to see anything until it's too late and that is where a LiDAR could reliably and stably and precisely identify the best timing to break or not.

另一種情況通常發生在晚上。我再次建議您查閱《華爾街日報》的資料集，我認為其中包含了 200 多個案例。如果你觀察這些案例，你會發現很多案例通常都與光照條件的變化有關，尤其是在黑暗中，或者在隧道內外，電腦視覺很難看清任何東西，直到為時已晚。而光達則可以可靠、穩定、精確地辨識煞車或不煞車的最佳時機。

So those are the two scenarios we consistently see across different -- even Level 2 Plus Plus applications. But again, as said, for Level 2 Plus Plus, you can always blame the human. And that's not a big deal if machine fails because humans are supposed to be the backup plan. And Level 3, you're giving humans freedom to not to pay attention. And that is a big safety risk.

所以，這兩種情況我們在不同的申請中，甚至在二級加強版申請中，都會反覆看到。但是，正如前面所說，對於 2 級以上的情況，你總是可以把責任歸咎於人。如果機器故障，那也沒什麼大不了的，因為人本來就是備用方案。第三級，你給了人類不去關注的自由。這是一個很大的安全隱憂。

And we also talked about the introduction of regulations, mandating higher safety standards, for example, the Level 3 policy rolling out from China and also the AEB speed requirements rolling out from NHTSA. I think with these kinds of safety standards rolling out, the [count] per vehicle financially will be higher as well. That means that LiDAR -- the number of LiDARs per car can potentially increase. That will be beneficial to us financially. Hope that answers your question, Jackie.

我們還討論了引入法規、強制執行更高安全標準等問題，例如中國推出的 L3 政策以及美國國家公路交通安全管理局 (NHTSA) 推出的 AEB 速度要求。我認為隨著這些安全標準的推出，每輛車的經濟效益也會提高。這意味著每輛車的雷射雷達數量可能會增加。那將為我們帶來經濟上的好處。希望這能解答你的疑問，傑基。

Yeah, that's very clear.

是的，這一點很清楚。

So for my second part, I have few mini questions regarding to the ATX product. The first one is how is the progress of ATX to the integrator with headlight. I guess, there should be some -- there probably would be some technical issues with that.

第二部分，我有一些關於ATX產品的小問題。第一個問題是 ATX 與整合商的整合進展如何，以及大燈的整合進度如何。我想應該會有一些——但可能會有一些技術問題。

And the second mini question is regarding how do you guys achieve a lower cost for ATX other than the economies of scales. Do we employ more maybe the Chinese supply chain, et cetera? Thank you.

第二個小問題是，除了規模經濟之外，你們是如何降低 ATX 的成本的？我們是否應該更多地利用中國的供應鏈等等？謝謝。

So I'll do the second question first. The way we achieve a lower cost for ATX are a few things. The first is that the level of economies of scale, as we expect millions of units to be shipped over the lifetime of such a product, and we already see that.

那我先回答第二個問題。我們降低 ATX 成本的方法有以下幾點。首先是規模經濟效益，我們預計此類產品在其生命週期內將出貨數百萬台，而且我們已經看到了這一點。

And second is the further -- into level of integration and ASICs because it's using our gen 4 semiconductor. Well, if you remember AT was gen 2. And so that is a major improvement on the level of integration. Integration in semiconductor industry means half the savings because you just use less area -- part of the wafer to build such a chip.

其次，由於採用了我們的第四代半導體，因此在整合度和專用積體電路 (ASIC) 方面有了更大的提升。嗯，如果你還記得的話，AT是第二世代的。因此，這在整合程度上是一個重大進步。半導體產業的整合意味著可以節省一半的成本，因為你只需要使用更少的面積——晶圓的一部分來製造這樣的晶片。

Number three is the product definition fit in a sense that AT's areas was more generic because that's the first time we define ADAS forward-looking sensor. By the time of ATX, we had hundreds of thousands of sensors of experience knowing where to focus and where we can relapse, with respect a little bit to achieve a relatively similar higher performance. So we are able to fine-tune such a sensor and to fully utilize what is needed and then cut costs as a part that is not necessary.

第三點是產品定義契合度，從某種意義上說，AT 的區域劃分更加通用，因為這是我們第一次定義 ADAS 前視感測器。等到 ATX 的時候，我們已經擁有數十萬個感測器，累積了豐富的經驗，知道應該在哪裡集中精力，以及在哪些方面可以稍作調整，以達到相對類似的更高績效。因此，我們可以對這種感測器進行微調，充分利用所需功能，然後削減不必要的零件成本。

With the combination of those three factors, we are able to achieve a superior cost to performance ratio.

綜合這三個因素，我們能夠達到優異的性價比。

And with regards to your first question about integration, we signed a partnership together with Marelli several months ago to integrate our ATX LiDARs into the headlights. And remember that Marelli is, of course, one of the most famous Tier 1 suppliers for global OEM, so that's about integration. I think ATX can be applied to many placements on the cars, and we will be seeing large adoption for the ATX products starting in 2025 and even bigger volume in 2026.

至於你提出的第一個關於整合的問題，幾個月前我們與馬瑞利簽署了合作協議，將我們的 ATX 雷射雷達整合到前大燈中。當然，別忘了馬瑞利是全球 OEM 廠商中最著名的 Tier 1 供應商之一，所以這關乎整合。我認為 ATX 可以應用於汽車上的許多位置，我們將在 2025 年開始看到 ATX 產品被廣泛採用，並在 2026 年實現更大的銷售。

Thank you. That concludes our question-and-answer session. I'd like to turn the call back over to the company for closing remarks.

謝謝。我們的問答環節到此結束。我想把電話轉回給公司，請他們做總結發言。

Thank you once again for joining us today. If you have further questions, please feel free to contact our IR team. That concludes today's call and we look forward to speaking to you again next quarter. Thank you and goodbye.

再次感謝您今天蒞臨。如果您還有其他疑問，請隨時聯絡我們的投資者關係團隊。今天的電話會議到此結束，我們期待下個季度再次與您交流。謝謝，再見。

Thank you, everyone.

謝謝大家。

This concludes today's conference call. You may now disconnect your lines. Thank you very much.

今天的電話會議到此結束。現在您可以斷開線路了。非常感謝。