Black Sesame International Holding (2533) H1 2024 earnings summary

Executive summary

• Revenue for the six months ended June 30, 2024, rose 69.2% year-over-year to RMB180.1 million, driven by increased sales and mass production of autonomous driving SoC products and solutions.

• Gross profit surged 365.3% to RMB90.1 million, with gross margin improving from 18.2% to 50.0% year-over-year, supported by higher-margin software and algorithm licensing.

• Net profit reached RMB1,104.8 million, reversing a net loss of RMB3,729.1 million in the prior year, mainly due to a RMB1,931.8 million fair value gain on financial instruments issued to investors.

• Adjusted net loss (non-IFRS) was RMB602.3 million, reflecting ongoing high R&D investment and excluding fair value changes and share-based compensation.

• The company completed its IPO on August 8, 2024, with gross proceeds of HKD1.036 billion and automatic conversion of preferred shares to ordinary shares.

Financial highlights

• Revenue from autonomous driving products and solutions increased 85.5% year-over-year to RMB167.3 million, while intelligent imaging solutions revenue declined 21.1% to RMB12.9 million.

• Cost of sales rose 3.4% to RMB90.1 million, with a significant shift toward higher-margin software licensing in imaging solutions.

• Research and development expenses grew 21.8% to RMB687.3 million, accounting for 67% of total operating expenses.

• General and administrative expenses increased 38.8% to RMB182.5 million, mainly due to higher share-based compensation.

• Cash and cash equivalents stood at RMB920.0 million as of June 30, 2024, down from RMB1,306.6 million at year-end 2023.

Outlook and guidance

• Plans to accelerate commercialization of existing and new SoC products, including mass production of Huashan A1000, Wudang C1200, and launch of A2000 in Q4 2024.

• Expansion of partnerships with domestic and international OEMs and Tier 1 suppliers, with anticipated chip deliveries to leading NEV companies in H2 2024.

• Focus on developing next-generation autonomous driving algorithms and intelligent imaging solutions, including BEV algorithms and AIGC applications.

• Intends to expand into emerging fields such as humanoid robots, vehicle-road-cloud integration, and international markets, especially the US and Europe.