BLACK SESAME INTELLIGENCE (02533.HK) announced that for the six months ending June 30, 2024, the company's revenue increased by 69.2% to 18.01 million yuan, mainly due to an increase in sales of autonomous driving products and solutions. The company recorded a profit of 110.48 million yuan for the six months ending June 30, 2024, compared to a loss of 372.91 million yuan in the same period last year.

The overall gross profit of the company increased by 365.3% to 9.01 million yuan. The gross profit margin of the company's autonomous driving products and solutions increased from 12.9% for the six months ending June 30, 2023, to 47.2% for the six months ending June 30, 2024. This is because the company's autonomous driving algorithms integrated in the SoC-based solutions have been improved and verified in the commercial production process, allowing customers to choose solutions with fewer hardware components based on their needs. The gross profit margin of the company's intelligent imaging solutions business increased from 47.5% in the same period last year to 86.6% for the six months ending June 30, 2024. This is mainly due to the increase in revenue generated by the licensing of self-developed software and algorithms with no hardware components and higher gross profit margins. Due to the above reasons, the overall gross profit margin of the company increased from 18.2% in the same period last year to 50.0% for the six months ending June 30, 2024.

The company's research and development expenses increased by 21.8% to 68.73 million yuan for the six months ending June 30, 2024, mainly due to the commercial adaptation of C1200 and ongoing research and development of higher performance A2000 chips.

The company continues to increase its investment in research and development. In the first half of 2024, research and development expenses accounted for 67% of total operating expenses in the same period, and the proportion of research and development team personnel reached 85%. The company is committed to developing more advanced SoC products, expanding its product line, and meeting the demand for Level 3 and above autonomous driving functions. For example, the company is developing the华山A2000SoC, which, according to Frost & Sullivan, will have a design computing power of 250+TOPS and will become one of the world's highest performing vehicle-grade SoCs.

As of June 30, 2024, the company has 58 authorized patents in China, 72 authorized patents in the United States, 121 patent applications in China, and 45 patent applications in the United States. As of the same date, the company has registered two integrated circuit layout designs in China, 96 software copyrights, and registered two software copyrights in the United States, as well as 176 registered trademarks worldwide.

The company's华山A1000 high-performance chip series has been mass-produced and installed in vehicles, supporting Level 2 to Level 3 autonomous driving functions, including memory parking, autonomous parking, and NoA functions on highways and city expressways. At present, the NoA function has covered 13 provinces and cities in China, including Sichuan, Shanxi, and Shandong. As of June 30, 2024, the华山A1000 chip has been successfully applied to mass-produced vehicles such as Geely Lynk 08 and Dongfeng eπ007, Dongfeng eπ008 and other Dongfeng eπ models. The company has obtained SoC mass production intentions for 23 models from 16 automotive OEMs and Tier 1 suppliers.

As an emerging application scenario of intelligent driving technology, the integration of vehicle and road cloud realizes real-time information interaction between vehicles, roads, and traffic facilities through deep integration of software and hardware, thereby effectively reducing transportation costs and improving transportation safety. Relying on the chip and algorithm advantages accumulated in the mass production of passenger cars and commercial vehicles, the company conducts precise perception and fine management based on trajectory analysis of all road traffic participants, including pedestrians and vehicles. So far, the company has carried out a number of vehicle-road cloud integration projects in Hubei, Shenzhen, Luoyang and other places, further expanding its market in the field of intelligent transportation.

The company stated that as the application of its chips and algorithms in the automotive autonomous driving field continues to deepen and mature, and the computing power of its chip products continues to increase, the company will not only expand into more automotive application scenarios, but also actively expand into emerging fields such as humanoid robots.