Unitree Robotics' profits plunge 53% days before critical Star Market IPO hearing

Unitree Robotics, a leading Chinese humanoid robot maker, revealed a sharp decline in first-quarter profits just days before its crucial initial public offering (IPO) hearing on the Shanghai Stock Exchange's Star Market. According to a regulatory filing, adjusted net profit plummeted 52.4% to 40.3 million yuan (US$5.9 million) from 84.8 million yuan a year earlier, even as revenue climbed 68.1% to 422.8 million yuan. The company attributed the profit squeeze to a significant increase in research, development, and sales expenses, along with rising competition in the humanoid robot sector and a cooling of broader market hype. The filing also warned that if commercial adoption of general-purpose robots stalls or the short-term robot leasing market weakens, growth and margins could face further pressure.

The IPO hearing, scheduled for June 1, is a major milestone for Unitree, which aims to raise 4.2 billion yuan (US$618.9 million) to fund robot body development, embodied AI models, and manufacturing facilities. The news of the upcoming hearing sparked a buying frenzy among retail investors on Tuesday, driving up shares of companies with direct exposure to Unitree, including its pre-listing shareholders and upstream suppliers. However, the profit plunge casts a shadow over the IPO, as investors weigh the company's rapid scaling against shrinking margins. The outcome of the hearing could signal the market's appetite for humanoid robotics firms amid intense competition and cost pressures.