The big winner of intelligent driving equity emerges

Author | Chai Xuchen

Editor | Zhou Zhiyu

At the beginning of this year, a wave of equal rights in intelligent driving swept through the automotive industry, and the big winners behind it have begun to emerge.

On August 27, Horizon released its mid-year report for 2025, once again showcasing a "surging" growth rhythm. The financial report shows that Horizon's total revenue during the period reached 1.57 billion yuan, a year-on-year increase of 67.6%. The core engine of its growth is the mid-to-high-end intelligent driving solution business driven by the wave of "equal rights in intelligent driving."

During the period, Horizon's product solution business had a total shipment volume of 1.98 million sets, achieving a doubling. Among them, the shipment volume of mid-to-high-end product solutions reached 980,000 sets, a staggering increase of 6 times compared to the same period last year, accounting for nearly half of the total shipment volume, while contributing 80% of the revenue from the product solution business.

Due to the increased proportion of mid-to-high-end products, the per-vehicle value of Horizon's product solutions has risen significantly, increasing by nearly 70% year-on-year, driving the total revenue of the product solution business to grow 3.5 times compared to the same period last year, with revenue of 778 million yuan.

"Horizon’s core strategy for the next five years is to sprint wildly in intelligent driving, aiming to be the world’s number one, ten times better than the second place, at which point the OEMs will embrace you." The ambition of founder Richard Yu seems to be gradually becoming a reality along with the narrative of equal rights in intelligent driving.

Data shows that in the first half of 2025, the penetration rate of assisted driving for independent brands rose from 51% at the end of 2024 to 59% in the first half of 2025. This is even higher than the penetration rate of 44% for new energy vehicles during the same period. This indicates that the market's demand for intelligent driving functions, especially high-level intelligent driving, has surpassed the demand for electrification itself.

Currently, the penetration rate of assisted driving in China's passenger cars has reached 65.6%, with the proportion of high-level intelligent driving functions rapidly increasing to 32.4%. At the same time, the installation rate of NOA as standard equipment in new energy passenger cars has reached 27%. Clearly, the market is officially transitioning from popularization to advancement. Canalys predicts that this year, the penetration rate of L2 and above intelligent driving functions in the Chinese market will further increase to 62%.

"Striving for higher is the main theme of the next stage of the intelligent driving industry," Richard Yu judged at the earnings conference. Horizon is not only a beneficiary of this trend but also a leader. Financial report data shows that in the first half of 2025, Horizon's market share in China's ADAS (basic assisted driving) market and the overall assisted driving computing solution market for independent brands reached 45.8% and 32.4%, respectively, both ranking first and further consolidating its market leadership.

He revealed at this earnings conference that since most of this year's orders will be delivered in the second half of the year, mainly for new cars from Geely, Chery, and Changan, he remains optimistic about the annual shipment volume, expecting it to reach 4 million sets, with the shipment volume of the Zhengcheng 6P and HSD also reaching tens of thousands of sets, and the average product price for the year will continue to increase Market demand expectations have been fully met, but domestic intelligent driving players are not solely dominated by Horizon. Competitors like Momenta, Pony.ai, and WeRide are also racing ahead. To achieve the "ten times better than the second place" FLAG mentioned by Yu Kai, Horizon's "FSD"—Horizon Super Drive (HSD) is about to enter the market.

Recently, Wall Street Insight experienced HSD in downtown Shanghai ahead of schedule. It is understood that the new version of HSD is not an incremental patch on the existing architecture, but rather built from scratch based on its leading Journey series chips, adopting a soft and hard combined "one-stage end-to-end" architecture to create an intelligent system that can continuously observe, think, decide, and operate like a human driver.

In terms of user experience, the biggest highlight of this HSD is that it instills greater trust in passengers, with its vertical speed control reflected in starting at traffic lights and automatic following, showing a balance of tension and relaxation. Therefore, HSD is referred to by industry insiders as the intelligent driving system closest to the Tesla FSD experience. This is a key card for Horizon's upcoming land grab.

"HSD will be a nuclear-level product." The nuclear power that Yu Kai speaks of lies not only in the high-level experience but also in the price.

Currently, passenger cars priced over 100,000 yuan account for 80% of the overall sales of passenger vehicles in the Chinese market. With a market space close to 20 million vehicles, Horizon has the opportunity to bring the per-vehicle cost down to several hundred dollars (not exceeding 7,000 yuan).

Yu Kai's strategy is thus reflected; Horizon aims to truly bring the previously high-priced urban NOA into the popularization stage.

As of now, HSD has secured targeted models from multiple car manufacturers, with mass production plans for related models scheduled for the second half of 2025. Yu Kai stated that HSD will become a standard configuration in the next 2 to 3 years, with future models priced between 100,000 to 150,000 yuan all equipped with urban NOA solutions. Horizon's internal plan is to deploy millions of HSD units in the next 3 to 5 years.

It can be said that Horizon has now entered a harvest period, with HSD opening up vast growth space for Horizon, which has also raised expectations in the capital market. Just one day after the mid-year financial report was released, Horizon's Hong Kong stock closed with a 14.7% increase.

However, Yu Kai and Horizon are not yet at the stage to pop champagne in celebration. Currently, Horizon is still in the investment phase, with an adjusted operating loss of 1.11 billion yuan, still some distance from profitability. The main reason for the loss is the company's investment in the R&D of high-end solutions like HSD, particularly the increasing costs of cloud services required for model training. Yu Kai stated that this strategic investment helps the company seize the trend of high-end product structure and is a necessary expenditure for growth.

Yu Kai mentioned that Horizon is seizing the opportunity to invest firmly in HSD R&D and increase cloud computing resources for model training and iteration. "This year, Horizon's expenses on cloud computing training have increased at least threefold compared to last year." In other words, Horizon is currently in a critical period of harvest and investment. On one hand, the "simultaneous increase in volume and price" of mid-to-high-end solutions is translating into tangible revenue growth; on the other hand, to secure victory in the rapidly evolving battle for intelligent driving, the company must continue to strategically increase investments in next-generation technologies such as HSD. From the perspective of loss data, Horizon is still some distance away from "opening champagne to celebrate," but it has already seized a favorable position in the industry wave of "moving upwards."

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