Investment Rating - The report maintains a "Buy" rating for the company [1][3] Core Views - The company reported a revenue of 1.74 billion RMB for the first half of 2024, representing a year-on-year growth of 21.4% [1] - The net loss for the same period was 2.48 billion RMB, which is a 21.2% reduction compared to the previous year [1] - The adjusted EBITDA loss was 1.89 billion RMB, narrowing by 6.7% year-on-year [1] - The company’s cash flow from operating activities showed a net outflow of 3.52 billion RMB, widening the gap by 1.72 billion RMB compared to the same period last year [1] Business Analysis - Revenue from generative AI reached 1.05 billion RMB, growing by 100% year-on-year [2] - Traditional AI revenue fell by 50.6% to 520 million RMB, primarily due to a significant decline in smart city business [2] - Smart vehicle revenue doubled to 170 million RMB, with 705,000 units delivered, marking an 80% increase [2] - The total number of GPUs deployed by the company reached 54,000, with total computing power exceeding 2.0 PFLOPS [2] - The total workforce decreased by 6.9% to 4,672 employees by the end of June 2024 [2] - The company’s financial income increased by 180 million RMB year-on-year, while tax credits decreased by 120 million RMB [2] Profit Forecast, Valuation, and Rating - Projected revenues for 2024, 2025, and 2026 are estimated at 4.24 billion RMB, 5.49 billion RMB, and 6.89 billion RMB, respectively, with growth rates of 24.6%, 29.3%, and 25.5% [3] - Expected net losses for the same years are projected at 4.69 billion RMB, 4.07 billion RMB, and 3.53 billion RMB, with year-on-year reductions of 27.1%, 13.4%, and 13.2% [3] - The company is valued at 9.8x, 7.6x, and 6.0x price-to-sales ratios for the years 2024, 2025, and 2026, respectively [3]

Investment Rating - The report maintains a target price of HK$1.36 for SenseTime, reflecting a 15.3% upside from the current price of HK$1.18 [4]. Core Insights - SenseTime's total revenue for 1H24 grew by 21% YoY to RMB1.74 billion, with an adjusted net loss narrowing by 3% YoY to RMB2.33 billion, indicating improved net loss margin [2][3]. - The generative AI (Gen AI) business is identified as the key growth driver, with revenue increasing by 256% YoY to RMB1.05 billion, accounting for 60% of total revenue in 1H24 [2][3]. - The report anticipates total revenue growth to accelerate to 33% YoY in 2H24, driven by robust demand in the Gen AI sector [2][3]. Financial Performance Summary - Revenue projections for FY24E, FY25E, and FY26E are RMB4.36 billion, RMB5.48 billion, and RMB6.60 billion respectively, with adjusted net losses expected to be RMB3.51 billion, RMB2.52 billion, and RMB1.72 billion [3][5]. - The gross profit margin (GPM) for 1H24 was 44.1%, with expectations of a gradual decline to 38% by FY26E due to increased operational costs [2][5]. - The adjusted net margin improved by 33 percentage points YoY to -134% in 1H24, reflecting operational leverage and cost control [2][5]. Market Position and Competitive Edge - SenseTime has become the third largest AIDC service provider in China with a market share of 15.4% as of 2H23 [2]. - The company has a strong AI infrastructure with operational computing power exceeding 20,000 PetaFLOPS, expected to surpass 25,000 PetaFLOPS by the end of FY24 [2][3]. - The report highlights SenseTime's independence from direct competition with suppliers and clients, enhancing its competitive edge in the Gen AI market [2].

好以下我先来宣读免责声明今天的讨论可能会包含前瞻性陈述前瞻性陈述涉及内在风险及不确定因素可能导致实际业绩偏离当前的预期有关该等风险及不确定因素的详细论述请参阅商舱集团向香港交易所递交的最新公告内容本次会议中所提供的一切前瞻性陈述均基于我们认为截至今日合理的假设 商量集团并不承担更新该等陈述的任何义务除非适用法律定有规定本次讨论还包含某些非国际财务报告准则的财务措施仅供比较之用此外在今天的会议中管理层将以中文做预先准备的发言口译员将在英文会议线路上提供英语同声翻译 详细信息请参阅我们的业绩公告若原话和翻译有出入请以管理层的原话陈述为准稍后徐立博士将首先向大家介绍商汤2024年上半年的整体表现接下来由徐冰介绍集团的业务进展再由王征向大家回顾公司的财务表现 在管理层的讲解之后我们会进行一个简单的问答环节好下面有请徐立博士发言好的谢谢市委也谢谢线上的关注商场的朋友们欢迎大家参加我们2024年的中期业绩的发布会首先这一页我来给大家介绍一下我们上半年的业绩的亮点 这是我们去年实施转向生成式AI的业务重组后的第二次的业绩报告我们也看到了很不错的态势上半年的集团总收入是17.4亿元同比增长了21.4%海外收入同比增长超过40 ...

Financial Performance - For the six months ended June 30, 2024, total revenue reached RMB 1,739.7 million, representing a year-on-year increase of 21.4%[6] - The gross profit for the same period was RMB 766.8 million, with a gross margin of 44.1%, up from 45.3% in the previous year[6] - The company reported a net loss of RMB 2,477.2 million, a reduction of 21.2% compared to the previous year's loss[6] - The adjusted EBITDA for the period was RMB (1,889.6) million, a decrease of 6.7% year-on-year[6] - Operating loss for the six months ended June 30, 2024, was RMB 2,721.5 million, compared to RMB 3,347.3 million for the same period in 2023[26] - Adjusted EBITDA loss improved slightly from RMB 2,025.9 million in 2023 to RMB 1,889.6 million in 2024[26] - The loss for the period was RMB 2,477.2 million, a decrease from RMB 3,142.6 million in the previous year[74] - Total comprehensive loss for the period was RMB 2,405,234 thousand, a decrease from RMB 2,606,540 thousand year-over-year[76] Revenue Breakdown - The revenue from generative AI reached RMB 1,051.2 million, showing a significant growth of 255.7% and accounting for 60.4% of total revenue[7] - The revenue from the "Jueying" smart car business reached RMB 168.1 million in the first half of 2024, representing a year-on-year growth of 100.4%[17] - Revenue increased by 21.4% from RMB 1,433.1 million for the six months ended June 30, 2023, to RMB 1,739.7 million for the six months ended June 30, 2024, driven by growth in generative AI and smart vehicle revenues[27] - Generative AI revenue surged by 255.7%, rising from RMB 295.5 million to RMB 1,051.2 million, accounting for 60.4% of total revenue[27] - Smart vehicle revenue grew by 100.4%, increasing from RMB 83.9 million to RMB 168.1 million, primarily due to increased product production and V2X-related services[28] - Traditional AI revenue declined by 50.6%, falling from RMB 1,053.7 million to RMB 520.4 million, as the company shifted focus from smart city projects to generative AI[28] Operational Highlights - The overseas business revenue grew by 40.1%, contributing 18.5% to the total revenue[7] - The AIDC service's operational capacity exceeded 20,000 PetaFLOPS, up from approximately 12,000 PetaFLOPS at the end of March 2024[11] - The company has over 3,000 industry-leading clients utilizing its large model and AIDC services[10] - The company achieved a market share of 16% in the large model platform sector, ranking second in the industry[8] - SenseTime's AIDC service market share ranks third in the industry, with a projected annual compound growth rate of 57.3%, reaching nearly RMB 200 billion by 2028[12] Research and Development - Research and development expenses increased by 6.1% to RMB 1,892.2 million, with a workforce of 3,399 R&D personnel[7] - The "Riri Xin" model achieved a 400% increase in overall usage during the reporting period, with significant growth in user numbers and average usage per user[14] - The "Riri Xin" model 5.5 version improved overall capabilities by approximately 30% compared to version 5.0, enhancing multi-modal capabilities significantly[14] - The financial model capabilities are being utilized by major clients such as China Bank and China Merchants Bank for various business scenarios[15] - The "Dai Ma" medical model is being implemented in major hospitals, enabling intelligent diagnosis and patient management throughout the medical process[15] Cash Flow and Liquidity - The total cash and cash equivalents as of June 30, 2024, were RMB 7,626.5 million, down from RMB 9,423.5 million as of December 31, 2023, representing a decrease of 19.1%[51] - The net cash used in operating activities for the six months ended June 30, 2024, was RMB (3,523.8) million, compared to RMB (1,804.8) million for the same period in 2023, indicating a significant increase in cash outflow[52] - The net cash used in investing activities for the six months ended June 30, 2024, was RMB (1,068.2) million, primarily due to purchases of property, plant, and equipment[54] - The net cash generated from financing activities for the six months ended June 30, 2024, was RMB 2,722.7 million, mainly from the net proceeds of common stock placements and borrowings[55] Shareholder and Corporate Governance - The company received the "ESG New Benchmark Enterprise Award" for its commitment to sustainable development through AI technology[22] - The company was recognized as one of the "Best Employers" and "Most Digitally Responsible Employers" by Forbes in 2023[24] - The board emphasized the importance of maintaining compliance with international financial reporting standards to ensure transparency[177] - The company is focused on enhancing shareholder value through strategic investments and improved financial performance metrics[178] Future Outlook - The company plans to continue focusing on market expansion and new product development to drive future growth[76] - The company provided a positive outlook for the next quarter, projecting revenue growth of A% based on current market trends and user engagement[178] - New product launches are expected to contribute an additional B million in revenue, with anticipated market expansion into C regions[178] - Market expansion strategies include potential acquisitions, with the company evaluating E targets to strengthen its market position[178] - The company has implemented new strategies to improve operational efficiency, aiming for a reduction in costs by F% over the next fiscal year[178]

Financial Data and Key Metrics Changes - Group revenue for the first half of 2024 reached RMB 1,740 million, representing a 21.4% increase year-on-year [6] - Generative AI revenue surged to RMB 1,050 million, accounting for 60% of total group revenue, up from 21% last year [12] - EBITDA loss reduced by 26.5% and overall loss decreased by 21.2% in the first half of 2024 [8][42] - Gross profit margin remained at 44%, consistent with the previous year [42] Business Line Data and Key Metrics Changes - Generative AI revenue increased by 256% year-on-year, becoming the primary driver of revenue growth [39] - Sensors revenue doubled to RMB 1,168 million, accounting for 10% of group revenue [12] - Traditional AI revenue was RMB 520 million, contributing 30% of group revenue, indicating a decline [40] Market Data and Key Metrics Changes - Overseas market revenue grew by 40% year-on-year, now accounting for 18% of total revenue [13][41] - The Chinese intelligent computing services market is projected to grow at a CAGR of over 50% for the next five years, reaching nearly RMB 200 billion by 2028 [21] Company Strategy and Development Direction - The company is focused on generative AI, leveraging deep synergies between large models and infrastructure to enhance model capabilities and reduce costs [7][39] - The strategic pivot towards generative AI has been more successful than anticipated, with significant growth in various sectors including intelligent hardware, electric vehicles, and finance [10][12] - The company aims to expand its operational computing power to 25,000 petabytes by the end of the year [19] Management Comments on Operating Environment and Future Outlook - Management expressed optimism about the generative AI market, highlighting its rapid growth and the need for companies to invest in large models [9][76] - The competitive landscape is described as fierce, with significant investments required to maintain competitiveness [8][39] - Management emphasized the importance of balancing long-term growth with short-term investments [8] Other Important Information - The company has deployed over 50,000 GPUs, with total computing power exceeding 20,000 petabytes, positioning it as a key player in the AI infrastructure market [18] - The SESNOVA large model series has shown significant improvements, with version 5.5 released in July 2024, enhancing capabilities and real-time interaction [24][25] Q&A Session Summary Question: What are the potential applications for edge AI in collaboration with smartphone manufacturers? - Management is optimistic about edge AI prospects, emphasizing the growth of the user base and the potential for new application models beyond smartphones, including IoT devices [52][54] Question: How is the company planning to scale computing power resources? - The company is focusing on improving operational efficiency while expanding computing power, adopting a strategic approach to maintain competitiveness [58][59] Question: What are the core capabilities of the next generation large model? - Management discussed the importance of reasoning and high-order data in enhancing model capabilities, emphasizing the need for better data and model architecture [63][66] Question: Which products or services predominantly contribute to the increase in generative AI revenue? - The company is focusing on the commercialization of its technological expertise in AI infrastructure and large models, which has led to significant growth in generative AI revenue [72][76] Question: What is the current progress in commercializing end-to-end algorithms in the autonomous driving sector? - The company is dedicated to a pure visual technology path for autonomous driving, leveraging its computational resources to support automakers in developing advanced driving technologies [81][84]

Investment Rating - The report maintains a target price of HK$1.5 and an OUTPERFORM rating for SenseTime Group [6][4]. Core Insights - SenseTime launched the first streaming multi-modal AI interaction model "SenseNova 5.5" in China, which shows a 30% performance improvement over "SenseNova 5.0" and is comparable to GPT-4o [2][4]. - The upgraded end-side model "SenseChat 5.5 Lite" has improved accuracy by 10%, increased inference speed by 15%, and reduced first package latency by 40% [2]. - The gap between the launch of SOTA models in China and the U.S. has been shortened to 2 months, with SenseTime successfully iterating to "SenseNova 5.5" in just over 50 days after "SenseNova 5.0" [5][6]. - The company has over 3,000 government and enterprise clients using its models, indicating strong market penetration [2]. - SenseTime's generative AI business is expected to exceed 50% of group revenue this year, driven by continuous technical advancements [6]. Summary by Sections Product Launch and Performance - During the WAIC, SenseTime introduced "SenseNova 5.5" and "SenseChat 5.5 Lite," showcasing significant advancements in multi-modal AI capabilities [2][4]. - "SenseNova 5.5" integrates cross-modal information for real-time interaction, enhancing user experience and supporting multi-task processing [2]. Competitive Positioning - The report highlights that SenseTime's advancements have significantly reduced the time required to catch up with benchmark models like GPT-4o, showcasing its industry-leading R&D capabilities [5][6]. - The technical validation of "SenseNova 6.0" has been completed, ranking it first on HuggingFace's global list for models below 12B [5]. Financial Outlook - The company is expected to achieve profitability at the group level within the next 1-2 years, with a strong focus on generative AI and leveraging profits from its computing power segment to fund R&D [6].

[Table_MainInfo] 公司研究/信息服务 证券研究报告 商汤-W(0020.HK)公司报告 2024 年 07 月 14 日 股票数据 0[7Ta月b1le2_日S收to盘ck价(In港fo元] ) 1.38 52 周股价波动(港元) 0.58-1.96 总股本/流通股(百万股) 35142/27622 总市值/流通市值(百万港元) 48496/38119 市场表现 恒生指数对比 1M 2M 3M | --- | --- | --- | --- | |-------------------------|-------|-------|-------| | 绝对涨幅(%) | -8.3 | -9.5 | 95.6 | | 相对涨幅(%) | -4.0 | -2.7 | 91.7 | | 资料来源:海通证券研究所 | | | | 分析师:杨林 Tel:(021)23183969 | --- | |----------------------------| | Email:yl11036@haitong.com | | 证书:S0850517080008 | | 分析师:杨蒙 | | Tel:(021) ...

Investment Rating - The report initiates coverage with a "Buy" rating for the company [3][4]. Core Insights - SenseTime is a leading AI enterprise in China, focusing on generative AI, with a strategic shift in business focus to this area in 2023. The company aims to leverage its capabilities from computational infrastructure to large model deployment, anticipating significant growth driven by AI terminal and multimodal model demand [3][16]. - The generative AI market is expected to grow rapidly, with projections indicating a global market size of $150 billion and a Chinese market size of approximately $13 billion by 2027, reflecting compound annual growth rates of 85.7% and 86.2%, respectively [3][23]. - The company has established a leading AI computational infrastructure, SenseCore, capable of supporting the entire lifecycle of trillion-parameter large models, which positions it well for future growth [3][25]. Summary by Sections 1. Earnings Forecast and Valuation - Revenue projections for SenseTime are estimated at 45.76 billion, 60.05 billion, and 77.06 billion RMB for 2024, 2025, and 2026, respectively. The net profit is expected to be -4.54 billion, -2.93 billion, and -1.44 billion RMB for the same years [10][14]. - The company is valued using a price-to-sales (P/S) ratio, with a target price set at 2.25 HKD based on a comparable company average P/S of 15.16 for 2024 [3][14]. 2. Generative AI Business Growth - The generative AI business has seen explosive growth, with revenue reaching 1.18 billion RMB in 2023, a 200% year-on-year increase, and now accounting for 35% of total revenue [17][21]. - Traditional AI business revenue has declined by 41% to 1.84 billion RMB, reflecting a strategic reduction in reliance on lower-quality cash flow segments like smart city projects [17][18]. 3. Technological Capabilities - SenseTime's SenseCore infrastructure supports large model training and has achieved over 90% acceleration efficiency in its training clusters, with a total operational computing power of 12,000 P and 45,000 GPUs [25][27]. - The company has rapidly iterated its "日日新" large model, achieving performance levels comparable to leading international models like GPT-4 Turbo [28][30]. 4. Market Potential - The generative AI sector is positioned as a key growth driver across various industries, with significant investments and developments occurring in finance, education, healthcare, and more [23][24]. - The report highlights the potential for generative AI to transform productivity and operational efficiency across sectors, indicating a broad market opportunity [21][23].

Investment Rating - The report maintains an "Outperform" rating for the company [3][5][10]. Core Insights - The company is experiencing revenue growth driven by generative artificial intelligence, with the launch of SenseNova 5.0 outperforming GPT-4 Turbo in Chinese scenarios [3][10]. - The generative AI segment has generated revenue of 1.1837 billion yuan, a year-on-year increase of 199.9%, accounting for 34.8% of total revenue, up from 10.4% in 2022 [3][10]. - The smart automotive segment, represented by the company's product, generated 383.7 million yuan, a 31.1% increase, with its revenue share rising from 7.7% in 2022 to 11.3% [3][10]. - Traditional AI business, including smart city initiatives, saw a revenue decline of 41.1%, with its revenue share dropping from 81.9% to 53.9% [3][10]. - The company is significantly reducing its reliance on the smart city segment, which now accounts for less than 10% of total revenue [3][10]. Financial Summary - The company's market capitalization is 20.76 billion HKD (approximately 2.65 billion USD) [3]. - The current share price is 0.80 HKD, with a target price set at 1.50 HKD [3][5]. - Revenue projections indicate a decrease from 3.809 billion yuan in 2022 to 3.406 billion yuan in 2023, followed by an expected increase to 4.480 billion yuan in 2024 and 6.053 billion yuan in 2025 [3][18]. - The net profit is projected to improve from a loss of 5.414 billion yuan in 2023 to a loss of 1.938 billion yuan in 2025 [3][18]. - The company’s asset net value is projected to decline from 23.155 billion yuan in 2023 to 19.484 billion yuan in 2024, before recovering to 32.173 billion yuan in 2025 [6][19]. Valuation Methodology - The report employs a NAV valuation method, assigning a multiple of 2.0 times the asset net value, leading to a target price of 1.50 HKD per share [6][10]. - The report highlights the scarcity of available computing infrastructure as a key factor in the company's valuation [3][10]. Product Development - The SenseNova 5.0 model has been trained on over 10TB of text data, significantly enhancing its understanding of Chinese language and cultural contexts [3][10]. - The model utilizes a mixture of experts (MoE) approach, allowing for more accurate contextual understanding in specific industries [3][10]. - The deployment of AI servers and cloud-based AI functionalities is becoming increasingly urgent due to rising demand [3][10].

Investment Rating - The investment rating for the company is "Outperform the Market" [1] Core Insights - The company has launched the "SenseNova 5.0" large model system, which matches the performance of GPT-4 Turbo, showcasing its strong technological capabilities and opening new growth opportunities [4][8] - The company has established a comprehensive "cloud, edge, and end" model product matrix, positioning itself as a leader in the industry [5][7] - The financial forecast indicates a significant revenue growth trajectory, with expected revenues increasing from 3,406 million HKD in 2023 to 9,657 million HKD by 2026, reflecting a compound annual growth rate (CAGR) of approximately 45% [6][16] Summary by Sections Investment Information - The stock closed at 1.19 HKD, with a market capitalization of 39.83 billion HKD and a circulating market value of 30.88 billion HKD [1] Market Performance - The company has shown strong absolute and relative performance compared to the Hang Seng Index, with a 70% increase over the past month [2] Financial Information - Revenue is projected to grow from 3,809 million HKD in 2022 to 6,647 million HKD in 2025, with a year-on-year growth rate of 37% in 2024 and 43% in 2025 [6][16] - The gross margin is expected to improve from 44.07% in 2023 to 69.84% by 2026, indicating enhanced profitability [6][16] Product Development - The "SenseNova 5.0" model has significantly improved capabilities in knowledge, mathematics, reasoning, and coding, making it suitable for various applications in education and finance [4][8] - The company has also made advancements in multimodal capabilities, achieving top rankings in authoritative benchmark tests [8][14] Strategic Partnerships - The company has formed strategic partnerships with major players like Kingsoft and Xiaomi to enhance its AI applications across different sectors [7][8] Future Outlook - The report suggests a reasonable valuation range of 2.40 to 3.00 HKD per share, based on a price-to-sales ratio of 16-20 times for 2024 [8]