Hong Kong – SenseTime reported its first IFRS net profit since listing, as an accelerated shift from “model intelligence” to “agentic intelligence” lifted revenue and margins in the six months ended 30 June 2026.

Financial highlights • Revenue rose 23.4% year-on-year (YoY) to RMB 2.91 billion (US$401 million). • Generative AI sales climbed 28.2% to RMB 2.33 billion, accounting for 79.9% of the top line. • Gross profit increased 32.9% to RMB 1.21 billion; gross margin widened to 41.4% (1H25: 38.5%). • IFRS net profit reached RMB 617.31 million, reversing a RMB 1.49 billion loss a year earlier, aided by RMB 1.25 billion in fair-value gains on investments and RMB 521 million from subsidiary disposals. • Adjusted net loss narrowed 67.3% to RMB 385.90 million; adjusted EBITDA turned positive at RMB 384.86 million (1H25: –RMB 540.34 million). • Recurring Revenue more than doubled to RMB 1.14 billion, now 39.3% of total sales. • Overseas revenue advanced 127% YoY, outpacing domestic growth.

Segment performance • Generative AI: RMB 2.33 billion (↑28.2% YoY). • Computer Vision: RMB 496.80 million (↑13.9% YoY) after strategy optimisation. • X Businesses: RMB 86.90 million (↓18.6% YoY) following deconsolidation of certain units.

Cost structure and efficiency • Cost of sales rose 17.5% to RMB 1.70 billion, with higher AIDC depreciation and operations linked to expanded compute capacity. • R&D expense fell 17.1% to RMB 1.76 billion, reflecting disciplined spend. • Administrative expense declined 13.2% to RMB 518 million; selling expense flat at RMB 271 million. • Net finance income was RMB 18 million; gearing remained in net cash territory at –8.6%.

Cash and capital • Cash and cash equivalents: RMB 9.88 billion; term deposits: RMB 3.12 billion. • Total borrowings: RMB 6.08 billion; daily average token service volume exceeded 2.4 trillion in July 2026. • April 2026 share placement raised HK$3.23 billion (≈RMB 2.84 billion) to expand domestic AI compute capacity, accelerate SenseNova model R&D and fund AI integration in verticals.

Strategic developments SenseTime advanced its “one model system, one Token Factory, one Agent Harness” framework, launched multimodal agent SenseNova 6.8-Flash, and open-sourced its U1 model family, attracting over 11,000 GitHub stars within four months. Physical AGI efforts progressed via the Kairos 3.1 world model, while regional expansion included a domestic compute cluster in Saudi Arabia and a planned 40,000 PFLOPS facility in Hong Kong.

Outlook Management targets continued growth in recurring, task-based AI services, deeper market penetration among enterprises and “one-person companies,” and further cost reductions through domestic compute optimisation and energy-compute synergy.

Dividend No interim dividend was declared for 1H 2026.

Compliance & governance The Company confirms adherence to the Corporate Governance Code, save for the combined roles of executive chairman and chief executive officer held by co-founder Dr. Xu Li. All Directors complied with the Model Code for securities transactions during the period.