Horizon Robotics, a Chinese autonomous driving technology provider, aims to raise US$696 million through its Hong Kong IPO, potentially providing a boost to the city's listing market after a prolonged downturn. The company will issue 1.36 billion shares, priced between HKD3.73 and HKD3.99 (approx. US$0.48-0.51) each. If successful, the IPO will be the largest in Hong Kong this year, exceeding China Resources Beverage's US$650 million offering launched earlier.
Whether Chinese autonomous driving chips can secure a foothold in the global market remains uncertain. Following Black Sesame Technologies' (BST) IPO, Horizon Robotics will proceed with its own listing on October 24 in Hong Kong. Backed by Alibaba and Baidu, Horizon is also one of TSMC's major customers and a primary supplier for Volkswagen in China.
Key investors in Horizon Robotics include Alibaba, Baidu, automaker BYD, and battery giant CATL. Its long-anticipated Hong Kong IPO has attracted substantial interest, positioning the company as a bellwether in China's autonomous driving industry.
Since entering mass production in 2021, Horizon Robotics has rapidly expanded its product line, facing international competition from Mobileye and Nvidia, and domestic rivals like BST and Hubei Siengine Technology. The company has established itself as China's largest supplier of mass-produced ADAS and high-level autonomous driving solutions.
Horizon Robotics is projected to reach a valuation of HKD52 billion following its IPO, according to Sina and Pandaily. Cornerstone investors—including Alisoft China (an Alibaba subsidiary), Baidu, Participations 1, and the Ningbo Yongning Gaoxin SP fund—will invest US$220 million collectively, helping stabilize the company's post-listing performance and growth prospects in the autonomous driving sector.
A Horizon executive revealed that shipments of the Journey series computing solutions have surpassed 6 million units. The executive noted that client partnerships have expanded significantly across the industry. As China accelerates efforts toward domestic alternatives for autonomous driving chips, key local automakers have placed large orders, driving Horizon's rapid revenue growth in recent years.
From 2021 to 2023, Horizon Robotics posted revenues of CNY467 million (approx. US$63.98 million), CNY906 million, and CNY1.552 billion, reflecting a compound annual growth rate of 82.3%. In the first half of 2024, revenue surged 151.6%, totaling CNY935 million, underscoring the company's accelerated growth.
Volkswagen stands as Horizon Robotics' largest customer. In the first half of 2024, Carizon—a joint venture between Horizon and Volkswagen—generated CNY351 million in licensing revenue, contributing 37.6% of Horizon's total revenue. Volkswagen owns 60% of Carizon, with Horizon holding the remaining 40%.
Despite impressive growth, Horizon Robotics remains in the red. Between 2021 and the first half of 2024, it incurred losses of CNY1.1 billion, CNY1.89 billion, CNY1.64 billion, and CNY800 million, respectively. The company attributes these losses to substantial investments in early-stage chip research and development, essential for maintaining a competitive edge in the fast-evolving autonomous driving sector—a common challenge for startups striving for technological leadership.
Horizon Robotics relies heavily on TSMC for its semiconductor manufacturing. Industry analysts note that while Horizon's chips still lag behind Nvidia and Mobileye in areas such as toolchains and ecosystem development, they have proven to be stable and reliable within the Chinese market.
Sources indicate that Horizon's competitive edge lies in its cost-effectiveness. Huawei's autonomous driving platform, for instance, costs over CNY100,000, while Horizon offers comparable solutions for a fraction of the price. Founder and CEO Kai Yu disclosed that the Journey 5 chip is priced at half the cost of Nvidia's Orin.
The company's dependence on TSMC for chip manufacturing highlights the importance of maintaining a stable supply chain, particularly if Nvidia's high-performance chips become unavailable in China.
In early 2024, Horizon Robotics launched HorizonSuper-Drive, a flagship all-scenario autonomous driving solution powered by the Journey 6 chip. Offering 560 TOPS of computing power, the Journey 6P chip supports full-stack tasks such as sensing, planning, decision-making, and control. Its capabilities extend to key autonomous driving scenarios, including highway NOA, urban NOA, and automated parking.
Amid US sanctions, Horizon Robotics has become a key alternative for many Chinese automakers, offering solutions tailored to local market needs. However, the company faces the critical challenge of closing the technological gap with Nvidia, whose Thor chip delivers 2,000 TOPS of computing power, raising the stakes in the race for leadership in autonomous driving technology.
