Hesai's Second Act: From Lidar to Full-Stack Robotics Infrastructure
SGI segment posts first revenue, guidance tripled as actuation modules and spatial intelligence turn the company into a physical AI platform.
HSAI · Earnings Call · 2026-08-18
A New Engine Comes Online
The second quarter of 2026 is a clear inflection point for Hesai Group. The company, long known as a lidar maker, is now formally reporting two engines: the core lidar business and Strategic Growth Initiatives (SGI). CFO Andrew Fan opened the segment discussion with the headline: “we now manage and report our business through 2 segments: our core lidar business and our strategic growth initiatives or SGI” — Peng Fan, CFO · 2026-08-18. The numbers back it up — SGI posted its first-ever revenue of RMB 45 million (USD 7 million), driven by early demand for robotic actuation modules. That success prompted management to “raise our full year 2026 SGI revenue guidance from RMB 100 million to a range of RMB 200 million to RMB 300 million” — Peng Fan, CFO · 2026-08-18, with expectations of roughly USD 100 million in 2027 and breakeven that same year.
Meanwhile, the core business remains healthy: total revenue rose 22% year-over-year to RMB 861 million, gross margin held at 40%, and GAAP net income climbed 60% to RMB 71 million — a fifth straight profitable quarter. Lidar shipments reached 628,000 units, up nearly 80% year-over-year, with robotics lidar growing 193%. The company's long-standing dominance in China's long-range ADAS lidar continues, with a 44% share per Gasgoo. Yet the real news is the pivot.
The second quarter of 2026 marks a major turning point for Hesai. We are opening a truly exciting new chapter in our history.
Why Actuation Works
The robotic actuation business is the most tangible proof that Hesai's expertise in precision electromechanical systems transfers beyond spinning mirrors. CEO David Li explained that lidar and actuator joints share the same underlying physics of position, speed, and force control. The company rebuilt the actuation stack from scratch, achieving roughly 3x torque density and a 37% smaller package than leading products. The first major customer is Sharpa, a humanoid startup of which Li is a co-founder — a relationship that raises governance eyebrows but also provides a real-world proving ground.
The supply arrangement with Sharpa is material: Hesai is seeking to raise the annual cap under its supply framework from RMB 100 million to RMB 300 million. In just a few months, cumulative actuation module shipments exceeded 10,000 units, with monthly production capacity ramping toward 10,000. The goal is six-digit volumes in 2027. This is not a lab experiment. Sharpa's robot is expected to work a full Dairy Queen shift in Shanghai later this year — a world-first zero-retrofit commercial deployment.“Actuation modules started generating revenues in the second quarter of 2026 and are ramping fast.” — Yifan Li, CEO · 2026-08-18
The Spatial Data Play
If actuation is the muscle, Kosmo is the learning brain. This spatial intelligence platform combines an AI spatial camera, algorithms, 3D asset generation, and cloud services to digitize physical spaces into high-fidelity, interactive models. The use cases span robotics training, film production, tourism, and advertising — essentially turning the physical world into a reusable digital library.
Prototypes shipped in July, and within seven days Hesai had orders from leading humanoid companies like Galbot. Already, Kosmo can reconstruct a 200-square-meter restaurant in about one-fifth the time of a leading alternative, with 4-millimeter text on a menu remaining legible. This is the kind of step-change that supports a subscription-and-licensing revenue model — a potentially higher-margin recurring stream compared to hardware sales. The company expects Kosmo to contribute revenue starting in Q3 2026, with a contribution of low eight-digit RMB for the year.“<keyword id="2942764fa4">robotic lidar</keyword> shipments in the second quarter almost tripled compared with the same quarter last year” — Yifan Li, CEO · 2026-08-18, a reminder that the existing sensing business is still compounding.
Not Just Another Robotics Story
The broader market is waking up to physical AI — global keywords like "AI data centers" and "HPC data centers" show heavy capital flows into compute and infrastructure. But Hesai is among the few companies with a full-stack hardware play across sensing, intelligence, and actuation. This is not a me-too pivot: management has been telegraphing it for over a year, and the prior quarters' calls repeatedly referenced "eyes and muscles of physical AI." In the May 2026 call, CFO Andrew Fan already said “SGI is expected to be accretive to group gross margin over time” — Peng Fan, CFO · 2026-05-19 — now those words are turning into actual numbers.
What changed most is the tangibility. SGI is no longer a promise; it's a segment with revenue, guidance, and a clear pathway to breakeven. The SGI revenue narrative has shifted from R&D to commercialization, and the confidence is backed by an order book and a raise. The biggest question mark is governance — the Sharpa relationship is intertwined with CEO David Li, but the company has committed to fair-market terms and arm's-length transactions. For investors, the pivot opens a much larger addressable market than automotive lidar alone.“SGI commercial momentum has significantly exceeded our expectations.” — Peng Fan, CFO · 2026-08-18
The near-term risk is the execution risk of scaling two new businesses simultaneously while defending the lidar fortress. But Hesai has a track record of turning engineering complexity into mass production. If the SGI ramp goes as planned, the company could emerge as a rare pure-play "picks and shovels" supplier for the entire physical AI ecosystem — not just automakers.