Horizon (09660) announced: Income growth exceeds market expectations, HSD production driving business acceleration.

On July 21st, Horizon (09660) issued an announcement. The announcement showed that the company expects its continuous operating revenue in the first half of 2026 to reach 1.93 billion to 2.08 billion RMB, a year-on-year increase of 24.8% to 34.5%. The upper limit of the revenue growth guidance is higher than the market's general expectation of about 25% to 30%, exceeding market expectations overall. The announcement indicated that revenue growth is mainly driven by two major business segments: on one hand, the product solutions business continues to grow, benefiting from the company's continuously strengthened market position and steady increase in market share, as well as the full-scenario urban NOA solution HSD by Horizon beginning to scale up mass deployment; on the other hand, the licensing and services business maintains strong growth, authorizing underlying technologies - including BPU, AI basic models, and various toolchains - to a wider range of customers. The announcement pointed out that the above-mentioned growth is supported by the company's unique business model, which is similar to the combination of ARM and Android, authorizing platform-based fundamental technologies to numerous customers in the entire ecosystem. At the same time, the company's profit quality remains robust. It is expected that the gross profit of the continuous operating business in the first half of the year will reach 1.16 billion to 1.37 billion RMB, with a corresponding gross profit margin of approximately 60% to 66%. Against the backdrop of the market generally expecting the gross profit margin to be maintained around 60%, the company has given a guidance of up to 66% gross profit margin, reflecting the high threshold and strong competitiveness brought by the company's ARM+Android platform-based business model. The announcement also noted that the estimated net profit for the period is 3.5 billion to 4 billion RMB, mainly affected by the fair value changes of convertible loans issued to CARIAD. This income is a non-cash accounting treatment, mainly stemming from fluctuations in the company's stock price, and does not affect the company's main operational performance and cash flow. From an operational perspective, the company expects the adjusted net loss to remain stable and overall controllable, without significant expansion, reflecting further improvement in operational efficiency, continuous release of economies of scale, and continuous improvement in profitability.