CMB International: SenseTime's FY2025 performance exceeds expectations, and multimodal technology will optimize model cost efficiency

On March 24, SenseTime-W (0020.HK) released its full-year 2025 results. The next day, CMB International published a research note and commentary on the company. The company’s performance came in ahead of expectations; analysts recognized the strong momentum in its generative AI business and improvements in operational efficiency, and maintained a “Buy” rating. The day after the earnings report, SenseTime’s share price hit a high of HK$2.02 intraday, with the intraday high up 5.76%. The market responded positively to the turnaround in earnings and the company’s AI rollout.

The financial report shows that in fiscal year 2025, SenseTime’s total revenue grew 33% year over year, exceeding 5 billion yuan, and was 3% higher than Bloomberg’s consensus forecast, reaching a historical high. CMB International said that the core drivers of the performance beating expectations came from the strong showing of the generative AI business; revenue from relevant operations grew rapidly during the period, becoming the company’s core growth engine. At the same time, the company’s operating quality improved across the board. In the second half, earnings before interest, taxes, depreciation, and amortization (EBITDA) reached 380 million yuan, turning positive for the first time since going public; in the second half, operating cash flow delivered positive net inflows, with capital efficiency and “blood-making” ability reaching a new level.

Meanwhile, the improvement in SenseTime’s profitability exceeded the market’s expectations. According to the earnings report, SenseTime’s loss in fiscal year 2025 narrowed by 58.6% year over year, significantly better than market expectations. CMB International believes that operating leverage continued to release, driving a steady recovery in profitability. The company’s gross margin remained stable, and overall operating efficiency entered a continuous optimization channel.

In terms of business layout, SenseTime’s computer vision business, supported by multimodal agent technology, entered a new round of growth. The project proportion using multimodal and agent capabilities increased significantly, with overseas market expansion and domestic demand jointly supporting steady growth. Innovative businesses advanced steadily. Segments such as autonomous driving completed independent financing and operation, receiving strong recognition from external capital. The compute power foundation continued to be strengthened. As of March 2026, the operating scale of SenseTime’s large installations’ compute power had increased to 40.4 thousand PetaFLOPS, providing solid support for technology iteration and scenario deployment.

In addition, the company’s commercialization is also progressing in parallel. In 2025, SenseTime achieved key breakthroughs in areas such as multimodal large models and spatial intelligence. Its NEO-native architecture significantly lowered model training costs. The company’s native data analytics products such as Xiao Huansun, and creation agent Seko, achieved scaled user coverage. They formed mature commercialization closed loops in vertical scenarios including general office productivity, content creation, and finance, respectively. SenseTime plans to launch a new foundational model based on the second-generation NEO architecture in the second quarter of 2026, further enhancing multimodal capabilities and model cost-effectiveness, opening up greater commercialization space.

Based on the strong momentum in the generative AI business, CMB International raised its total revenue forecast for fiscal years 2026–2027 by 3%-6%. Analysts expect that in fiscal year 2026, the company’s total revenue will grow year over year by 27% to 6.39 billion yuan, with the core growth drive coming from a 35% year-over-year growth rate in the generative AI business. Going forward, the company will continue to deepen multimodal technology, optimize model cost and efficiency, and fully seize opportunities for the commercialization of generative AI, driving high-quality and sustainable business growth.

(Editor: Wang Lei)

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