(Yicai) Aug. 29 -- SenseTime, a Chinese artificial intelligence firm, said its first-half gross profit rate fell by more than 20 percentage points to 45.3 percent because of rising sales costs of hardware and AI data center products.
SenseTime’s costs surged 63 percent to CNY780 million (USD107 million) in the six months ended June 30 from a year earlier, the Beijing-based company announced yesterday. About 86 percent of the costs were subcontractors’ charges and hardware costs, of which the latter increased because of the intense competition between tech firms on large language models.
Net loss narrowed 2 percent to CNY3.1 billion (USD425.6 million) in the first half from a year earlier, and revenue rose 1.3 percent to CNY1.4 billion, SenseTime noted.
Revenue from the LLM and AI generated content business segment surged 670 percent in the period, with AIGC alone generating CNY280 million worth of revenue.
SenseTime cut investment in research and development. Its R&D expenses fell 12.4 percent to CNY1.8 billion in the first half from the same period last year, mainly because of lower staff welfare and operating and cloud service expenses, the company noted.
Moreover, media reports yesterday claimed SenseTime is laying off employees in multiple business departments.
SenseTime adjusts its strategies based on market and development changes and optimizes its organizational and talent structure to better develop its business, the firm told Yicai, adding that it is operating well and will continue to bring in experienced talents and outstanding college graduates.
Shares of SenseTime [HKG: 0020] were trading up 2 percent at HKD1.53 (20 US cents) as of 3.25 p.m. today.
