From "Burning Money" to "Profitable," the LiDAR industry is approaching a turning point, and the robot sector is on the verge of a significant scale-up.

Everyday Economics Reporter | Liu Xi Everyday Economics Editor | Yu Tingting

Recently, Hesai Technology (NASDAQ: HSAI; 02525.HK) and Sensing Technology (02498.HK) both released their Q4 2025 and full-year financial reports. Hesai Technology achieved full-year GAAP (Generally Accepted Accounting Principles) profit, while Sensing Technology posted a quarterly profit in Q4 2025.

The profitability of these leading companies confirms that the laser radar industry has officially shed the “money-burning” label and is entering a profit turning point.

Farewell to the “Money-Burning” Era

According to the financial reports, Sensing Technology achieved its first quarterly profit in Q4 2025, with a net profit of 104 million yuan. For the full year, Sensing Technology’s revenue was approximately 1.941 billion yuan, with a gross profit of about 514 million yuan, an increase of 81.3% year-over-year, and net losses narrowed by 69.9% to 145 million yuan. Hesai Technology went even further, becoming the first laser radar company in the industry to achieve full-year GAAP profit, with a net profit of 440 million yuan. In Q4, revenue exceeded 1 billion yuan, continuing its profitable trend.

Sensing Technology Financial Report Image Source: Hong Kong Stock Exchange Official Website

From a stage perspective, Sensing Technology represents the “establishment of a profit turning point,” while Hesai Technology signifies the “successful operation of a profit model.” Together, they mark the industry’s shift from a “high-investment period” to a “return period.”

The improvement in the profitability of laser radar companies mainly stems from explosive growth on the demand side. According to data from the Gaogong Intelligent Vehicle Research Institute, in 2025, the Chinese market for passenger cars (excluding imports and exports) equipped with pre-installed laser radar will reach 3.2484 million units, a year-over-year increase of 112.07%. The penetration rate of laser radar in new energy vehicles will reach 20.48%.

In terms of market structure, industry concentration further increases. Data shows that in 2025, the three companies Hesai Technology, Sensing Technology, and Huawei together hold over 90% of the market share in the front-mounted laser radar market for passenger cars in China, highlighting a clear head effect.

The rapid growth in demand has directly driven a significant increase in shipments. In 2025, Hesai Technology’s annual delivery volume of laser radar tripled year-over-year, while Sensing Technology’s total sales increased by 67.6% year-over-year.

However, the start of profitability does not mean the pressure has disappeared. Facing intensified competition from automakers, both companies have openly stated that laser radar product prices will continue to be under pressure in 2026. Meanwhile, as technological architecture stabilizes and cost structures continue to optimize, the rate of price decline is expected to gradually narrow, and gross margins will improve.

Hesai Technology Financial Report Image Source: Hong Kong Stock Exchange Official Website

CEO of Sensing Technology, Qiu Chunchao, pointed out that as new products stabilize in ramp-up, sales increase, and advantages in products and chips are released, the gross margin of ADAS (Advanced Driver Assistance Systems) will gradually improve and stabilize. Hesai Technology’s co-founder and CEO, Li Yifan, stated that through increasing the number of vehicles equipped, volume expansion of high-end products like ETX (automotive-grade ultra-long-range laser radar), and overseas market expansion, structural growth is expected to offset the impact of price reductions.

From “Cost-Driven” to “Performance-Driven”

If 2025 is the “profit year” for the laser radar industry, an equally important change is that the industry’s competitive logic is shifting from “cost-driven” to “performance-driven.”

In March this year, Huawei Qian Kun released a new generation of dual optical path image-level laser radar with 896 lines. Subsequently, the Dongfeng brand and Huawei Qian Kun announced that all models would be equipped with this laser radar. Industry experts generally believe that laser radar is entering the “thousand-line era,” and in 2026, a new round of competition in ultra-high-line digital laser radar will unfold.

Image Source: Sensing Technology Official Website

In response, Qiu Chunchao pointed out that high-performance laser radar will become the definite development direction for two reasons: First, as autonomous driving moves from urban NOA (Assisted Navigation Driving) to full-scenario applications, the demand for long-distance small target recognition and complex scene perception continues to rise, making higher-density point clouds a rigid requirement; second, digital architecture allows high-line laser radar to achieve mass production at controllable costs, with higher line counts offering more obvious advantages, even exponentially.

Additionally, different stages of autonomous driving have varying demands for laser radar. Qiu Chunchao said, “L2 and L4 are both competing on performance, just in different ways.” In the past, the L2 market was long considered to be “just competing on cost,” but this was fundamentally due to insufficient supply-side capability. As higher-line products are introduced at near-original costs, automakers are actively upgrading configurations.

For example, after 192-line products entered the market, customers who previously used 64- or 128-line solutions began to reassess and adjust their technical routes. This means the competitive logic in the L2 market will fundamentally shift from “whether it exists” to “whether it is good,” with performance becoming the new core variable.

Qiu Chunchao believes that, from a macro perspective, the industry is undergoing structural changes: the baseline capability of L2 is continuously rising, no longer just low-cost solutions; the threshold for L4 technology is steadily increasing, demanding higher system capabilities; and L3, as a key transitional layer, once mature, will reshape L2 downward and connect L4 upward. In this process, the boundaries between L2 and L3 will be redefined.

Robotics Business Becomes the Second Growth Curve

The improvement in profitability and the shift toward performance-driven development provide a foundation for laser radar companies to explore new business areas. The rapid growth in robotics products is causing a noticeable change in revenue structures within the industry.

Financial reports show that Sensing Technology’s robotics laser radar sales exceeded 303,000 units in 2025, a year-over-year increase of 1141.8%. In Q4 alone, sales reached 221,200 units, a 2565.1% increase year-over-year, accounting for 49% of revenue. Hesai Technology also achieved rapid breakthroughs, with a total of 240,000 related product deliveries in 2025, up 425.8% year-over-year. Qiu Chunchao estimates that this year, Sensing Technology’s robotics sales will reach 800,000 to 1 million units, nearly three times last year’s volume.

At the business level, laser radar companies show clear differentiation. On one hand, they focus on applications that have already achieved large-scale commercialization, such as lawn-mowing robots and logistics AGVs (Automated Guided Vehicles); on the other hand, they actively expand into frontier technologies like embodied intelligence.

Among niche markets, lawn-mowing robots are among the most mature and largest in shipment scale. Hesai Technology recently signed an order with Chase Mii for 10 million JT series laser radars for lawn-mowing robots; Sensing Technology has partnered with Kuma and Wulan Continental, securing exclusive orders from a leading cleaning robot brand. It is expected that by 2026, shipments of lawn-mowing robots will reach 450,000 to 600,000 units.

Image Source: Company Provided

Demand in embodied intelligence robots is also rising rapidly. Qiu Chunchao revealed that the company has already partnered with Zhiyuan, Yushu Technology, and other companies developing humanoid and quadruped robots.

In anticipation of the huge demand for laser radar in vehicle and robotics markets in 2026, leading companies are accelerating capacity deployment to ensure mass production and delivery schedules. It is reported that Sensing Technology has completed a 4 million unit annual capacity plan, and Hesai Technology expects to double its 2025 shipment volume of 1.6 million units to about 3 to 3.5 million units in 2026.

Dongwu Securities pointed out that as robotics expand into open environments, the number of laser radars per robot could increase from 1 to 3 units. By 2030, the market size for robotic laser radars is expected to reach 28 billion yuan, with a compound annual growth rate of 67.9%.