[cs_content _p=’8008′][cs_element_section _id=”1″ ][cs_element_layout_row _id=”2″ ][cs_element_layout_column _id=”3″ ][cs_element_text _id=”4″ ][cs_content_seo]Horizon Robotics, a leading Chinese AI chip manufacturer, has filed for an initial public offering (IPO) on the Hong Kong Stock Exchange, receiving approval for listing on October 8, 2024. The company, which initially focused on the AIoT (Artificial Intelligence of Things) sector, has now shifted its focus to the automotive industry, positioning itself as a key competitor to NVIDIA in the AI chip space.
Strategic Shift to the Automotive Industry
Founded in 2015, Horizon Robotics began its journey in the AIoT market, collaborating with major domestic appliance brands such as Midea. The company developed its Journey series AI chips, which found success in surveillance and smart city applications. However, after burning through $500 million and facing a financial crunch in 2019, the company had to restructure, downsizing and pivoting towards the automotive sector.
This transition became a turning point for Horizon when it secured a partnership with Changan Automobile, a subsidiary of China South Industries Group Corporation, one of China’s largest defense contractors. This collaboration allowed Horizon to integrate its AI chips into the automotive sector, a move that has been critical for its recent growth.
Competing with NVIDIA in AI Chips
Horizon Robotics has set its sights on competing with industry leader NVIDIA, aiming to deliver high-performance AI chips. Although the company originally planned to produce chips with 1,000 TOPS (trillion operations per second), it adjusted its target to 560 TOPS due to potential restrictions from the CHIPS and Science Act.
Despite its ambitions, Horizon has faced challenges with its system-on-chip (SoC) designs. Most of the company’s shipments have relied on imaging processors from third-party design services since 2018. Its first in-house-designed SoC, Journey 5, has struggled in the market, shipping to only one carmaker since its 2022 launch.
Strategic Partnerships Drive Growth
To solidify its relationship with Changan Automobile and its stakeholders, Horizon Robotics formed a joint venture called Changxian Technology, which is partly owned by China South Industries Group Corporation. This joint venture allows Horizon access to high-level automotive projects and supports the broader adoption of its technology.
Additionally, Horizon collaborates with China North Industries Group Corporation (Norinco), utilizing its Journey AI chips. These strategic partnerships have fueled Horizon’s rapid expansion, with the company shipping 5 million chips in 2023, generating RMB 1.5 billion (approximately $210 million USD) in revenue.
A notable collaboration with Volkswagen Group’s subsidiary CARIAD in December 2023 brought Horizon an investment of RMB 1.3 billion (around $180 million USD) and a contract valued at RMB 600 million (approximately $83 million USD), contributing significantly to Horizon’s annual revenue.
Government Support and Future Outlook
As geopolitical tensions rise, the Chinese government has actively supported domestic firms like Horizon to counterbalance American tech giants, particularly NVIDIA. Horizon’s IPO will be pivotal to its long-term growth, providing much-needed capital to compete on a global scale.
A successful IPO would not only secure Horizon’s future but also represent a major step forward for China’s ambitions in the global AI chip market. With significant government backing, strategic partnerships, and innovative AI technology, Horizon is well-positioned to challenge its competitors and make its mark in the industry.\n\n[/cs_content_seo][/cs_element_layout_column][/cs_element_layout_row][/cs_element_section][/cs_content]
