Text/Yang Jianyong
As the first of the four AI dragons, Syndym was listed before AI unicorns such as Megvii and Yuncong. Although the listing process was bumpy and even postponed for a while, it was finally successfully listed on the Hong Kong Stock Exchange on 30 December 2021. At the beginning of the listing, it was favored by investors, and the market value once exceeded HK$320 billion. Despite the recent correction, the market capitalization is still as high as HK$211.1 billion, up 63.63% from the issue price of HK$3.85. So, the capital market performance is strong, attracting countless eyes, this AI unicorn created by more than 3,000 scientists is the color of the color?
Losses continued to widen, and SenseTime was mired in losses
In 2021, SenseTime's revenue was RMB4.7 billion, up 36% year-on-year, with an annual loss of RMB17.177 billion, and a cumulative loss of more than RMB37.7 billion in the past four years. Among them, in 2018, 2019 and 2020, the loss was 3.432 billion yuan, 4.967 billion yuan and 12.158 billion yuan respectively. Of course, the large losses were mainly due to the fair value losses of preferred stock. The adjusted EBITDA loss in 2021 was 1.418 billion yuan, and the total adjusted loss in the past four years exceeded 3.4 billion yuan. Continuous loss is one of the biggest problems, losses not only show a trend of rising year by year, but also the amount of losses is amazing.
Not only SenseTime, but other AI unicorns are also in a state of long-term loss. From 2018 to 2020, the loss of GreenIng Deep Pupil was 74.55 million yuan, 418 million yuan and 78.2 million yuan respectively, and the cumulative loss in three and a half years was 570 million yuan, and the expected loss in 2021 was 65 million to 80 million yuan. In 2018, 2019 and 2020, Yuncong Technology lost 181 million, 1.708 billion and 690 million yuan respectively, with a loss of 323 million yuan in the first half of 2021 and a cumulative loss of 2.9 billion yuan in three and a half years. Yitu Technology lost more than 7.2 billion yuan during this period, and Megvii Technology and Yuntian Lifei were also in a loss situation.
Artificial intelligence has broad prospects, but on the road to artificial intelligence of "poetry and distance", artificial intelligence commercial application scenarios will be the core of AI unicorns. Players on the artificial intelligence track, the final competition is the ability to land technology, which is also an important basis for measuring the strength of AI. In the business process, AI unicorns have shown strong growth momentum. This is mainly due to the strong demand for artificial intelligence technology from all walks of life, so far the AI unicorns have shown a strong growth trend in revenue.
In the entire artificial intelligence market, edge artificial intelligence, computer vision, etc. are the most potential markets. According to an earlier Gartner survey, respondents to organizations investing in AI said they had the highest amount of investment in computer vision plans, averaging $679,000 over two years. According to the market report combining IDC and Sullivan, SenseTime has ranked first in The Market Share of Computer Vision Applications in China for three consecutive years.
Compared with other machine vision manufacturers, through the report, it can be seen that SenseTime HAS a strong landing ability. Combined with revenue, revenue has grown strongly over the past few years. Revenue in 2018 was 1.853 billion yuan, and by 2020 it will grow to 3.446 billion yuan, with a compound annual growth rate of 36.4%, and revenue in 2021 will increase by 36.4% year-on-year. Xu Li, CEO of SenseTime, said: "2021 is the most important year for SenseTime's development since its inception, our business has recorded accelerated growth, and our research and development has achieved a series of major breakthroughs to consolidate the foundation for future development. ”
In the landing scenario of SenseTime AI, smart business and smart city realization are strong
In terms of business model, with high scalability, its general artificial intelligence infrastructure SenseCore integrates the R&D and production capabilities into a unified underlying layer, providing a smooth, standardized, end-to-end artificial intelligence model production process. With SenseCore, a wide range of AI models that can be scaled and adapted to a wide range of scenarios can be mass-produced. By the end of 2021, SenseCore has produced more than 34,000 commercial models, an increase of 152% compared to 13,000 in 2020. With the support of SenseCore, SenseTime has accelerated the landing of AI technology in the four major sectors of smart business, smart city, smart life and smart car.
Among the four major business segments, smart cities performed well. By the end of 2021, a total of 140 cities have deployed SenseFoundry City Ark at SenseTime, an increase of 48% compared to the end of 2020. In addition, the number of AI models carried by urban rafting increased to 22,400, an increase of 156% compared with the end of 2020. With the improvement of the coverage and penetration rate of the City Ark in various cities, it has opened up the performance growth space. In 2021, the smart city segment achieved revenue of 2.14 billion yuan, an increase of 56.5% year-on-year, which is not only the largest business segment of SenseTime, accounting for nearly 50% of the total revenue, but also the strongest growth rate of each sector.
Secondly, as senseTime's second largest business segment, smart business also performed strongly, including leading customers in the state grid, Beijing-Shanghai high-speed rail, softbank, Alibaba Cloud and other industries, with a cumulative number of 922 customers. Because many industry leaders use their SenseFoundry-Enterprise Ark platform, one-stop access to more than 13,000 AI models to build various industry applications, realize the digital intelligent upgrade of enterprise production activities, space operations, and process management, and drive the commercial sector to become SenseTime's largest sector, accounting for 41.7% of total revenue, and achieve revenue of 1.96 billion yuan in 2021, an increase of 31.8% year-on-year.
Overall, thanks to the self-built SenseCore, a new intelligent infrastructure that integrates intelligent computing power, general algorithms and development platforms, tens of thousands of AI models produced have empowered more than 1 billion IoT devices in cars, mobile phones, urban spaces and commercial spaces, performing trillions of AI reasoning operations every day, realizing SenseTime's vision of connecting the physical world and the digital world.
Of course, the artificial intelligence market brings together many heavyweight players, and SenseTime not only has to face the same type of computer vision unicorns such as Megvii, Yuncong, and Yuntian Lifei, but also Huawei and BAT heavyweight technology giants, but also faces traditional giants such as Hikvision and Dahua. Previously, SenseTime noted that competitors may have a longer history of business operations, or will have or will have access to more financial resources, more advanced technical capabilities, and a wider customer base and relationships than we do.
In addition, as SenseTime expands into areas such as cloud services, competitors, the basis of competition will be different, facing more competitors. In the face of market competition, SenseTime raised HK$5.552 billion to enhance research and development capabilities, including expanding the computing power of AIDDC, strengthening the design of AI chips and developing its own AI chip solutions, and enhancing the capabilities related to AI models. As SenseTime invests heavily in R&D to support product and service innovation, it will benefit from the increasing efficiency of AI model production as SenseCore's technology and production capabilities continue to improve.
At last
Artificial intelligence intelligence empowers the transformation of thousands of industries and boosts the acceleration of industrial intelligence. Due to many factors such as the perfect service of technology giants and the ability to land scenes, the use of artificial intelligence to help all walks of life in transformation and upgrading is also reaping industry development dividends. For AI unicorns, in the face of an increasingly fierce competitive environment, whether they can maintain sustained growth also faces great challenges. At present, in the landing scenario of SenseTime AI, smart business and smart city are the core sectors, and the proportion of the two accounts for 87% of the total revenue, which can be seen in the strength of SenseTime AI on these two tracks. With the investment in artificial intelligence from all walks of life will increase, for players on the artificial intelligence track, it is expected to continue to harvest this market dividend.
Jianyong Yang, a contributor to Forbes China, is committed to in-depth interpretation of cutting-edge technologies such as the Internet of Things, cloud services and artificial intelligence.