East Sea Securities: Facing Competition with Continuous Innovation, the Global Potential of the Sweeping Machine Industry is Promising.

East Sea Securities released a research report stating that in recent years, top companies in the sweeping robot industry, such as Siasun Robot & Automation, have continued to upgrade their basic functions and integrate various cutting-edge technologies to enhance user experience and reduce market homogenization competition. The application of these innovative technologies has allowed the sweeping robot industry to maintain strong growth momentum. Chinese top brands have contributed significantly to the market and in the first quarter of 2025, the top 4 global intelligent sweeping robot shipment volumes were all Chinese brands, with the development of cross-border e-commerce providing a breakthrough for Chinese brands to enter overseas high-end markets. Focus on domestic sweeping robot companies such as Ecovacs Robotics (603486.SH) and Beijing Roborock Technology (688169.SH). East Sea Securities' main points are as follows: Improving domestic sales data, brand continuous innovation According to Oviyun net data, in the first half of 2025, the domestic retail sales volume of sweeping robots increased by 41.1% year-on-year, with a 40.7% increase in sales volume. In recent years, top companies have integrated various cutting-edge technologies, such as bionic robotic arms, self-cleaning, AI interaction, etc., on the basis of continuous upgrading of basic functions, aiming to enhance user experience and reduce market homogenization competition. The application of these innovative technologies has allowed the sweeping robot industry to maintain strong growth momentum. In addition, sweeping robot products have deepened their understanding of user pain points in design and improved their level of intelligence. The application of bionic robotic arm technology allows the sweeping robot to adapt more flexibly to various floor environments, especially hard-to-reach hygienic blind spots. The self-cleaning function significantly reduces the user's cleaning burden. The introduction of AI interaction technology enables the sweeping robot to provide personalized cleaning solutions. Mid-year promotions in the industry saw a decrease in average prices, with potential brand differentiation in the future According to Oviyun net online monitoring data, the average online retail prices of sweeping robots in May, June, and July this year decreased by -4.9%, -5.0%, and +4.3% year-on-year, while the proportion of retail sales in the high-end market was 13.7%, 16.1%, and 16.6%, respectively. The performance in May and June can be attributed to major promotion events. Looking at the performance from the beginning of the year to the 33rd week (mid-August), the average online retail price of sweeping robots has remained basically flat year-on-year. In terms of price segments, according to the July online monitoring data, the highest proportion was in the price range of 3500-4000 RMB, at 21.8%. In terms of specific brand pricing, Zhiyuan and DJI focus on the high-end market. The T80 model launched by Ecovacs Robotics this year lowers the price of the previous X9 model's water-carrying technology, expanding the price range. In addition, Ecovacs Robotics introduced a mini model this year with a subsidized price below 2000 RMB. This model is a new product targeting young consumers, with a smaller body size and a variety of color choices, catering to the needs of consumers looking for cost-effective options. In addition, there are also cost-effective models on Taobao's new product list, such as Midea's Lingmou sweeping robot V16 Pearl Edition, with a subsidized price below 2000 RMB. The global sweeping robot market has considerable potential As product quality improves and market education advances, sweeping robot products are gradually gaining recognition from more consumers. According to IDC data, the global intelligent sweeping robot market shipped 20.603 million units in 2024, a year-on-year increase of 11.2%; with annual sales revenue reaching 9.31 billion USD, a year-on-year increase of 19.7%. Technological upgrades are driving up the average price of products in the sweeping robot market, with the average price rising by 7.6% to 452 USD in 2024. In the first quarter of 2025, the global sweeping robot shipment volume increased by 11.9% year-on-year. Chinese top sweeping robot brands contribute significantly to market growth power According to IDC data, the top 4 global intelligent sweeping robot brands in the first quarter of 2025 were all Chinese brands, with Beijing Roborock Technology leading in market share. During Prime Day in 2025, Beijing Roborock Technology ranked first in the corresponding category market share on all Amazon channels in Europe, the United States, and Australia; outside of Amazon, sales in North America and Northern Europe increased by 57% and 97% year-on-year during the summer promotion compared to the same period last year. As for Ecovacs Robotics, after years of accumulation, it has established a rich overseas sales network and built a global brand image through multi-category layout, such as introducing a floor washing robot. Looking back, the development of cross-border e-commerce in recent years has provided a breakthrough for Chinese brands to enter overseas high-end markets, while the first-mover advantage in areas such as multi-functional base stations has allowed top brands to transition towards value competition. While continuing to innovate their products, Chinese sweeping robot companies are still exploring opportunities in various overseas market segments. For example, looking at the penetration rate of sweeping robots, there are still significant differences between emerging markets like Southeast Asia and mature markets in Europe and the United States, and with the promotion of product categories, there is great potential for growth. Risk warning: Risks of product and technology iteration falling short of expectations, risks of macroeconomic demand falling short of expectations, risks of fluctuations in raw material prices, risks of intensified market competition, risks of overseas trade policies and exchange rate fluctuations.