Investment Rating - The report maintains a "Buy" rating for Pony AI Inc. with a 12-month price target of US$23.10, indicating an upside potential of 138.1% from the current price of US$9.70 [17]. Core Insights - Pony AI's commercialization trajectory is viewed positively, driven by decreasing hardware and algorithm costs, expanding service coverage, increasing consumer acceptance, and favorable policy support [1]. - The report anticipates that China's robotaxi industry will achieve operating break-even by 2032, with Pony AI expected to reach operating break-even by 2029, faster than the industry average [1]. - Competitive advantages for Pony AI include experience and successful track records, in-house technology with rapid iterations, and ongoing partnerships with various ecosystem players [1]. Summary by Sections Fleet and Technology - Pony AI's Gen7 robotaxis, announced on April 23, feature lower costs and enhanced safety, supporting large-scale commercialization. The Gen7 model has a designed life of 10 years or 600,000 km and includes advanced sensor technology [6]. - The Gen7 models achieve a 70% reduction in Bill of Materials (BoM) costs compared to Gen6, with 80% savings on the car computing unit and 68% savings on LiDARs [6]. Strategic Partnerships - Pony AI has partnered with Tencent to integrate its robotaxi service into WeChat Mobility Services and Tencent Maps, expanding user access and reducing customer acquisition costs [9]. Earnings and Financial Projections - The report revises earnings estimates for Pony AI from 2025 to 2032, reflecting a more optimistic view on cost of goods sold (COGS) reduction. Lower vehicle and autonomous driving kit costs, along with fleet growth, are expected to improve operational leverage and future earnings [10]. - Revenue projections show significant growth, with revenues expected to reach US$3.85 billion by 2032, reflecting a compound annual growth rate (CAGR) of 33% in EBITDA from 2030 to 2032 [11][13]. Valuation - The target price of US$23.10 is based on a discounted EV/EBITDA method with a target multiple of 17.4x for 2030E EBITDA, discounted back to 2025E using a cost of equity (COE) of 11.5% [14].

Investment Rating - The report provides a "BUY" rating for key Robotaxi companies such as Pony AI and Baidu, indicating a positive outlook for their growth potential in the Robotaxi market [19]. Core Insights - The China Robotaxi market is projected to reach a total addressable market (TAM) of US$47 billion by 2035, a significant increase from US$54 million in 2025, driven by decreasing costs of hardware and algorithms [13][24]. - The report emphasizes that the commercialization of L4 autonomous technology is not a question of readiness but rather how companies will capitalize on the rapid advancements in autonomous development [1]. - Positive gross margins are expected at the vehicle level by 2026 in Tier 1 cities, with revenues per Robotaxi projected to reach US$31,000 by 2035 [7][24]. Summary by Sections China Robotaxi TAM Snapshot - The report highlights a substantial growth trajectory for the China Robotaxi market, forecasting a TAM of US$47 billion by 2035, compared to US$54 million in 2025 [13][24]. Ecosystem: Supply Chain of Robotaxi - The supply chain for Robotaxis includes key players such as Pony AI and Baidu, along with semiconductor suppliers like Horizon Robotics and automotive OEMs like Tesla and Xpeng [7][19]. Market Size and Penetration - The report anticipates a fleet size of 1.9 million Robotaxis by 2035, achieving a penetration rate of 25% in the total shared mobility vehicle market [15][24]. - The market size is expected to grow significantly, with a forecast of 700 times the current TAM growth over the next decade [12]. Revenue Generation - Revenue per Robotaxi in Tier 1 cities is expected to reach US$31,000 by 2035, driven by longer operating hours and efficient route planning [7][24]. Cost Reduction - Operating costs for fleet owners are projected to decrease, with costs per vehicle in Tier 1 cities expected to drop to US$19,000 by 2035 [24]. Unit Economics - The report models positive unit economics, predicting profitability by 2026 in Tier 1 cities and by 2031 and 2034 in Tier 2 and other cities, respectively [7][24]. Policy and Insurance Support - Supportive government policies and the development of insurance for the Robotaxi industry are identified as crucial for facilitating growth [7][24]. Future Market Segmentation - The report discusses potential future developments in the Robotaxi market, including the introduction of new vehicle models and shared ownership models to encourage adoption [24].

Investment Rating - The report indicates a positive outlook for the S&P 500, with a target of 5900, suggesting a potential upside from the current trading levels [2]. Core Insights - The S&P 500 return on equity (ROE) for 2024 is projected at 21.1%, marking a 34 basis points increase from the previous year and ranking in the 99th percentile over the past 50 years [2][4]. - The S&P 500's ROE is significantly higher than that of the rest of the developed world, with a gap of 8 percentage points (21% vs. 12%), which contributes to the US stock market's valuation premium [2][14]. - The report highlights that while the S&P 500 is expected to maintain its superior ROE, further widening of the ROE gap may be challenging due to headwinds affecting profit margins [2][31]. - The Magnificent 7 companies, which constitute a significant portion of the S&P 500, are experiencing a slowdown in ROE growth, which may impact overall index performance [33]. Summary by Sections Return on Equity Analysis - The S&P 500 ROE is highest in the Consumer Discretionary (34%) and Information Technology (32%) sectors, while Real Estate has the lowest ROE at 9% [2][10]. - The report utilizes a DuPont decomposition to analyze ROE drivers, identifying higher EBIT margins and asset turnover as key contributors to the ROE increase in 2024 [4][25]. Sector Performance - ROE increased in five out of eleven sectors in 2024, with the most significant expansion in Communication Services (+412 basis points) and the largest contraction in Energy (-537 basis points) [8][10]. - The report notes that the S&P 500 currently trades at a 2.4x greater Price/Book (P/B) multiple compared to the MSCI World ex. US, reflecting the valuation premium associated with higher profitability [10][12]. Future Outlook - Analysts expect the S&P 500 ROE to remain flat in 2025, with a slight increase of 40 basis points in 2026, similar to expectations for the MSCI World ex. US [31]. - The report emphasizes the importance of geographic diversification in investment portfolios due to the anticipated challenges in maintaining profit margins [31].

1 These are based on BOP definitions; the goods trade surplus would be 4.8% of GDP in 2025 (vs. 5.2% in 2024) based on the Customs definition. Investors should consider this report as only a single factor in making their investment decision. For Reg AC certification and other important disclosures, see the Disclosure Appendix, or go to www.gs.com/research/hedge.html. Andrew Tilton +852-2978-1802 | andrew.tilton@gs.com Goldman Sachs (Asia) L.L.C. Hui Shan +852-2978-6634 | hui.shan@gs.com Goldman Sachs (Asia) ...

Investment Rating - The report downgrades Hwatsing and Maxscend to Neutral from Buy due to relatively lower upside potential across the coverage [2][30]. Core Insights - The report remains positive on China Semis, driven by generative AI and autonomous driving trends, with upgrades for SMIC, VeriSilicon, AMEC, and Cambricon to Buy [1][2]. - Hwatsing is a local leader in CMP equipment, expanding into wafer thinning and ion implantation tools, but faces challenges in revenue growth from mature nodes [11][28]. - Maxscend is experiencing slower growth in the Android smartphone market, impacting its revenue and net income forecasts [31]. Summary by Company Hwatsing - Downgraded to Neutral with a 12-month price target of Rmb201, suggesting a 22% upside potential [10][11]. - Revenue estimates for 2025-27E revised down by 4%/5%/6% due to slower contributions from mature nodes CMP tools [2][14]. - Expected revenue growth of 38%/20% YoY in 2025/26E driven by product mix upgrades towards advanced nodes [12][14]. - 1Q25 results showed revenues of Rmb912 million, a 34% YoY increase but 7% below estimates [14][15]. Maxscend - Downgraded to Neutral with a 12-month price target of Rmb86, indicating a 14.9% upside potential [30][31]. - Net income estimates reduced by 36%/25%/4% for 2025-27E due to weaker-than-expected 1Q25 results and slow smartphone market growth [31]. - The company is expanding its product lines from RF discrete to modules, but faces gross margin pressure from pricing competition [31].

Investment Rating - The report does not explicitly provide an investment rating for the transportation industry but discusses various scenarios impacting trade volumes and earnings for 2025, indicating a cautious outlook [2][3]. Core Insights - The report introduces a US Tariff Impact Tracker to assess the ongoing effects of tariffs on global supply chains and freight flow, with a focus on high-frequency data [1]. - It outlines two primary scenarios for 2025: continued pull forward of shipments ahead of a 90-day tariff pause and a potential pause in customer orders due to uncertainty [2]. - The report suggests that trade flows from non-China Asia may remain stable as shippers adjust supply chains, while shipments from China to the US are expected to decline significantly [3]. - UPS anticipates a 25% decrease in China to US business in the second quarter, with overall international revenues projected to decline by only 2% year-over-year [3]. High Frequency Data Summary - Laden container vessels from China to the US have decreased by 23.3% year-over-year on average over the last week, following a previous increase of 22% [6]. - TEUs (Twenty-foot Equivalent Units) from China to the US have dropped by 26% year-over-year on average over the last week, down from a previous increase of 14% [11]. - Planned TEUs into the Port of Los Angeles decreased by 18% year-over-year, with forecasts indicating a further decline of 35% year-over-year in the following week [21]. Trade Volume Trends - The report notes that intermodal traffic on the West Coast increased by 5% on average in week 17, indicating that front-loaded traffic is still impacting volumes [27]. - The Logistics Managers Index shows upstream inventory expansion slowing down, while downstream inventories are expanding at a faster pace, possibly in anticipation of tariffs [47]. - The report highlights that the balance of trade volumes and earnings for the transportation sector remains uncertain, with potential scenarios ranging from a surge in orders to a continued decline [7].

Investment Rating - The report maintains a "Buy" rating for Sanhua, Shuanghuan, and a "Neutral" rating for LeaderDrive, Best Precision, and Moons' Electric [1][42][45][46][49]. Core Insights - The humanoid robot industry is experiencing rapid product iterations and increased R&D focus across various players, indicating a strong long-term total addressable market (TAM) potential despite uncertainties in near-term technological breakthroughs [1]. - The report forecasts 20,000 units of humanoid robots to be shipped in 2025 and 1.4 million units globally by 2035 [1]. - Domestic players are accelerating commercialization efforts, with several auto OEMs like Tesla, XPENG, and Xiaomi testing humanoid robots in their factories, aiming for mass production by 2025-2026 [2]. - The shift in R&D focus from hardware to robotic AI development is evident, with startups introducing various AI models trained on real data to enhance performance [2]. Product Progress - A small scale of commercialization is expected in 2025, with domestic players speeding up public sales of humanoid robots [2]. - Companies like ENGINEAI have started selling humanoid robots at competitive prices, with some models priced below RMB 200,000 [2]. - Major players are establishing production lines with capacities ranging from 10,000 to 50,000 units annually, adjusting expansion based on actual customer orders [6]. Software Development - High-quality real data is crucial for training robotic AI models, with startups focusing on developing their own AI systems [2]. - UBTech is optimizing its training strategy by combining real and simulated data to improve efficiency and reduce costs [2]. Hardware Innovations - The report highlights the emergence of new players in the humanoid robot component market, focusing on product differentiation [7]. - Companies like LeaderDrive and Shuanghuan are developing new reducer products and enhancing their manufacturing capabilities [7][29][31]. Supply Chain Dynamics - The supply chain for humanoid robots is expanding, with various component manufacturers reporting progress in R&D and sample testing [10]. - Companies like Sanhua and Tuopu are preparing for mass production of actuators and other components, targeting significant market shares [26][27]. Market Outlook - The humanoid robot market is projected to grow significantly, with various companies aiming to capture substantial market shares in their respective segments [42][45][46]. - The report emphasizes the importance of continuous innovation and adaptation in the rapidly evolving humanoid robot industry [2][6].

Investment Rating - The report does not explicitly provide an investment rating for the industry or companies analyzed Core Insights - The S&P 500 earnings growth for 1Q 2025 is tracking at 12%, significantly higher than the initial expectation of 6%, primarily driven by positive margin surprises [3][4][6] - There is an elevated level of uncertainty reflected in corporate forward guidance, with a lower proportion of companies providing EPS guidance compared to historical averages [3][10] - Consensus EPS revisions have been negative, indicating that uncertainty is beginning to weigh on demand and investment, with both sales and capex revision breadth turning more negative recently [3][21][22] - A notable increase in the mention of "recession" by S&P 500 companies during earnings calls, rising from 2% last quarter to 24% this quarter, highlights growing concerns about economic conditions [3][26][33] - Companies are quantifying the expected impact of tariffs on their financial metrics, with 22% of reporting companies providing estimates related to tariffs [31][34] Summary by Sections Earnings Performance - Year-over-year S&P 500 EPS growth is tracking at 12%, with better-than-expected margins contributing to positive surprises [3][4] - 51% of S&P 500 companies beat consensus EPS forecasts by more than a standard deviation, slightly above the long-term average of 48% [6][11] Forward Guidance - 17% of S&P 500 companies provided quarter-ahead guidance, slightly below average, while 45% provided FY1 guidance, in line with average [10][20] - 56% of companies guided below consensus FY1 estimates, indicating a more negative outlook compared to historical averages [17][20] Economic Concerns - The frequency of companies mentioning "recession" has increased significantly, reflecting heightened economic uncertainty [26][28][33] - Management commentary has focused on recession risks and the potential impact of tariffs on business operations [3][31] Tariff Impact - Companies are actively discussing the potential impacts of tariffs, with many quantifying expected costs and mitigation strategies [31][34][40] - The estimated tariff-related costs for various companies range widely, with some projecting impacts of hundreds of millions of dollars [34][43]

Investment Rating - The report assigns a Neutral rating to Tesla Inc. with a 12-month price target of $235, indicating a potential downside of 16.1% from the current price of $280.26 [21][26]. Core Insights - Tesla's ability to leverage its Full Self Driving (FSD) software in China is crucial for its future stock performance, given the size of the Chinese vehicle market and the competitive landscape for ADAS software [1][15]. - China has emerged as Tesla's largest market for new vehicle sales, attributed to higher BEV penetration rates compared to other regions [2][3]. - Tesla's TTM share in the US BEV market has decreased to approximately 45%, while its share in Europe has fallen to the low double-digit range; however, its share in China has remained stable in the high single-digit range [6][8]. Summary by Sections Market Dynamics - The Chinese market is characterized by a BEV adoption rate of over 30%, significantly higher than that of the US and select European countries [11]. - Consumer sentiment towards Tesla in China has been more favorable compared to North America and Europe, as indicated by stronger consumer scores and net buzz metrics [9][14]. Competitive Landscape - Tesla's FSD offering faces competition from local brands in China that provide advanced driver-assistance systems (ADAS) as standard features, which could impact Tesla's long-term economics related to autonomy [16][20]. - The report highlights various local competitors offering similar or superior features at competitive prices, which may challenge Tesla's market position [20]. Financial Projections - The report projects Tesla's revenue to reach approximately $97.69 billion in 2024, with an EBITDA of $16.01 billion [26]. - The analysis includes a downside scenario where Tesla's stock could drop to around $150, assuming slower volume growth and margin improvement, while an upside scenario could see the stock rise to approximately $345 [21].