66.8%. This is the gross margin that Chinese robot corporations UBTECH recorded in its humanoid business in the first half of this year. It is the ratio left after subtracting product cost from revenue, and it does not reflect expenses such as research and development and selling and administrative costs. It rose 19.5 percentage points from a year earlier, while humanoid revenue jumped 15.4 times and unit sales increased more than 20 times. As "economies of scale" emerge among China's leading humanoid makers that had expanded volume while tolerating losses, profitability is rising quickly.
On the 7th, according to UBTECH, boosted by strong robot sales, first-half revenue rose 104.2% from a year earlier to 1.27 billion yuan (about 258 billion won). The overall gross margin also climbed from 35% to 44.7%. UBTECH's humanoid products and services business, which accounted for less than 3% of revenue two years ago, rose to become the largest segment in the first half, making up nearly half of total sales.
When research and development and selling and administrative expenses are reflected, the company's overall bottom line is still in the red, but the size of the loss is shrinking quickly. UBTECH's net loss in the first half was 339 million yuan (about 69 billion won), down about 23% from a year earlier, and the loss based on earnings before interest, taxes, depreciation and amortization (EBITDA) also fell about 46%. Some say that if this trend continues, adjusted EBITDA could turn positive in the second half, with a possibility that net income will swing to a profit next year.
Another Chinese robot corporations, Unitree, is also seeing a virtuous cycle in which expanded mass production leads to cost reductions. According to global investment bank UBS, Unitree's average selling price for robots fell 56% in 2024 from a year earlier and 36% last year, but overall gross margin rose from 43.6% in 2023 to 60.3% last year. The impact came from lowering costs by making core components such as motors and actuators in-house and increasing annual sales to more than 5,000 units.
Chinese makers leveraging mass production are also rapidly expanding their presence in the global humanoid market. According to market research firm Counterpoint Research, global humanoid shipments in the first half exceeded 22,000 units, about three times the level of a year earlier, and Chinese corporations took all of the top five spots by shipments. AgiBot ranked first with about 9,700 units, Unitree was second with about 7,000, followed by Galbot, UBTECH, and Leju. Combined, these five companies account for 86% of the global market.
Korea is still at the stage of knocking on the door of the humanoid market. Rainbow Robotics posted 8.65 billion won in sales in the first half with a Humanoid Robot equipped with wheels on the lower body and two arms on the upper body, but its annual production capacity is around 120 units. The company's overall operating loss was 3.59 billion won, up about 3.9% from a year earlier.
ROBOTIS, which is preparing mass production of a bipedal humanoid, succeeded in turning to an operating profit for the full year last year, but most of its results come from robot joint components. Of 27.2 billion won in first-half sales, 98% came from actuators, the core components of robot joints, while wheeled humanoids accounted for 2%. ROBOTIS plans to mass-produce 1,000 units per year of its bipedal humanoid "AI Sapiens K1" starting next year. Robros, which is selling the bipedal humanoid "Egris-C," has produced 36 units to date and sold 18 for a fee.
An industry official said, "China is first producing finished products by the thousands, lowering component procurement unit costs and refining assembly processes while also accumulating on-site data," and added, "Domestic robot makers have strong component technologies but limited experience in mass-producing the main body, so how quickly they can connect mass-production plans to actual sales and cost reductions will be key to narrowing the gap with China."