Megvii Financials and Growth Examined

Published Aug 30, 2019 11:14 AM

Megvii has already received more than a billion dollars in investment. Now, the company, a top China facial recognition provider, has filed for an IPO this week on the Hong Kong Stock Exchange.

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This 500+ page IPO document reveals significant details into the size, growth, and usage of AI inside of China.

In this post, we look at the firm's financials, growth, City IoT focus, and the possible competitive threat to Hikvision & Dahua, including:

  • Megvii Background
  • Deeply Unprofitable, Growing Fast
  • Principal Verticals
  • Main Customers Mostly Security/Surveillance SIs
  • Low International Presence
  • City IoT Largest Segment By Far
  • Covered Cities, Revenue Per Customer Booming
  • Capitalizing on AI Camera Switch
  • Threat to Hikvision and Dahua?
  • Alibaba Ownership Stake Impact
  • US Sanctions Risk
  • Conclusion

********

****** *** * **** ******** ** PRC **** ************ ******** (**** ~*/**** of ***** *******), *********** *********** ********* and *****'* ****** ********. *** ******* Megvii *** ********* ***** *****' ****** success ******* ** ** ****, **** 95% ** ******'* ******** ********* ** China.

Megvii **********

******, ****-***** *** *******++********, ******** ****** *********** *** ** solutions ** *** *********** *** ********** sectors (***********, ******, *********** ***********, ***.) Megvii ** *** ** *****'* **** face *** ******** - ******** ****** over $* ******* - ***** ********,*********, ************. *** ****, **'* ** *******, has *,*** ********* ** ** **** its *** ******.

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Fast *******, **** *** $***+ ******* ******* **** ****

**** ******** *******, *** **** *** **** ******* of ~$*** *******, **** ** **** revenue ********, ******* *** **** ** pace ** ******** $***+ ******* ******* in ****.

** ******* ***** ************ ** ******* has ******** **** **** ***** ** revenue *** ******, **** **** ****-***** specialists **** ******** ***** **** **** of ******** ** ******* *** **** (*** ***** ******** ********).

************

**** **** ******** ****** ** ************, losing ****** **** * ******* ******* last ****, ******** *********** **** ** a ***-*** ****** ** *****-***** ************ and *&* ********.

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** *** ***** ****, ***** **** high ****** **** (******** ******** *********) and ******* ******** ******* **** ** attractive ** ********* ** *** ******* scales **.

Low ************* ********

****** ***** **% ** *** ******* inside *****, *** *** ******:

****** *** ***** ****** ******, ** generated *.*%, *.*%, *.*% *** *.*% of *** ******** **** ******* ******* of *** *** ** ****, ****, 2018 *** *** *** ****** ***** June **, ****, ************."

**** ** *** ** * *********** of ******* - *** ***'* ***** internal ******, *** *******'* ******* *** deploying ** / ****** *********** (******** ****** ***** ************ *****: **** Skynet ** ***** ****), ****** ***'* ******* ** ************** ** foreign *****.

Main *********

****** ******* *** ******** **** * main *********:

  • "******** ***" (*.*. ****** *********** ** unlock ***********)
  • "**** ***" (***** ******/****** ************ *****, residential *********)
  • "****** ***** ***" (***** ********* *** retail)

***** ** ***** ********* ** ****:

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City *** ****** */*** ** *******

**** ****** ****** **** ** ******** face *** ************** ** "**** **% of *******-***** ***********" ** ***** **** year, **** *** ** ** *** its **** ********* *******, ****** ** 73% ** *** ******* *** *** first *** ****** ** **** (~$*** million). **** *** ******* **** **** quadrupled ****-**-****, ************* ****** ****** **** the ***** *****:

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Clients ****** ********/************ ***********

**** ** ******'* ******* *** ******* integrators ** *** **** ************ *** smart ********* *****:

** ****, *** *** **** ********* included (*) * ****** ********** ** China *** ***** **** ********** *********, (ii) * ****** ********** ** ***** for ***** **** ********** *********, (***) a ****** ********** ** ***** *** smart ********* *********, (**) * ******** of ****************** ******* ** ***** *** (v) * ****** ********** ** ***** for ***** ********* *********"

***** ******* *** **** ******* ********* for **% ** ******'* ******* ** 2019.

Covered ****** & ******* *** ******** *******

** **** ***, ****** **** ** now ****** *** ***** ******, ****** twice ** **** ** * **** ago:

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***** ***** ******** ********* ******** **** 430 ** *** ***** ** *** year ** *** *****, ******* ******* per ******** ******** *** **** **** doubled ** ~$***,***.

*** *** ********* *** *** ***** / **** ***** ***** ****** *** Megvii.

City *** ******* *******

**** *** ** * ******* ******, with ***** ******** ** ***** ****** and "********* **********" (***** ********, *.*. face-based ****** ******* ** *********-*** ************) expected ** **** **** ********* **** over $* ******* **** **** ** over $** ******* ** ****:

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AI ******* ******** ** ***** ******* ******

****** ******* ** ********** ** *** switch ** ** ******* ** *****'* smart ******, ***** ** ********* **** a **% ******** **** ****, ********** to **** **% ** ****:

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********** ** ******* *** ***** ********,******* ** *** *** *** "****-*****" (i.e. ***-**-***) ******** ** "**-********* *** devices":

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****** ******* *** *** ****** ******, which *** **** ****** *** "************** extract **** ***** ** ********, ****** human *******, *****, ******** *** ******* plates, ** *** ***** ***":

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**** *** **** ******** ************ ***** cameras *** *** *** ******** ***** source *** ** ****** **** **** the *********** ** **** *********.

Threat ** ********* *** *****?

******'* **** *** ***** ***** ********* Dahua *** *********'* ********* *****. *** firms ********* *** **** *** ********** surveillance *****, *********** $*.* ******* ** ******** *****.

****** ****** *** *** ******* *** companies ** *** *** ******, ****** is **** ** **** *** ****** as "*** *********-*********** *** ******** ********" [******** *****]:

****** **** *****, ** **** ****** a *********** ****** ******** ** *****’* City *** ********, *****used ** ** ********* ** *********** ******** *************

****** *** ** ******** ** *********/***** in **** ***** ********** "*** **-******* players" (****** *** *** ******* ** our ******* ** ******* ****):

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**** *****'* ****** ************ ********* ** AI *******, ** ****** ******* ** capture **** ******, ** ***** **** a ****** ****** ** * *** part ** *********/*****'* ********. ***** ** no ********* ** ****, *******, *** it's ***** ****** **** ******** *********** *** **** *************** *** ********* **** ***** ************ on ********* '** *******' ** ***** cities ** ***** *** *** *****.

Alibaba ********* ****** ** ************

******* ** * '********* ********' **** Megvii, **** * **.**% ***** ** the *******. **** '***********', ** **** describe, ***** **** ** ****** ** their ********* **** ***** ************ *** competition **** ************ **********. ******* ** a **** ***** *******, **** ** larger **** *********, **** ********* ** expand **** ***** **** / **** surveillance. ********, ********,******* **** * *********** ********** **** Uniview, *****'* **** ******* ****** ******** competitor.

*** *********** ** *******, ******, *** Uniview *** *** ********* ** ** a *********** ****** ** *** ***** surveillance.

One *** ******'* ****** ********* ***** ** ********

************* *** *****, ****** *** ******** ************* *** ***** ** ******* ******* * '********* ******* ****' ** the ******** ****** ******** ***** **********. The **** **** ********* ********* ********* that ***** *** ****** ** ************* identify ******* ** ********* ****** ********,*** *** ********.

******* ** **** ****** *********** ********** *** ** *********, ***** **** ********* *** ***** and ***** ***** ************ *****. ********* on *** **** ** ********, ****** could ** ****** **** ***** **** US ********** (** ** ** ***** to *** '****** ****') ** ** ******* ****** **** the ** *** *** ** ****** frozen (** *** **** *********** *********). ** ******* ****** *** **** its **** ****"*** ** *** *****"******** **************** ****** ********* *****:

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** *** *** ******, ****** *** not ******* ********, *** *** ******** that ********* ** ********* *****:

***** ** ****** *** *********** ** our **********, ******** *** *********, ****** the ********* ** *** ****** *****, and *** ****** ** ******** *********, require *********** ********** **** *** ********* and ******* ** ** *****, ********* or ****** **** ** ***** ** modify *** ******** ******** *********, *** of ***** *** **** * ******** and ******* ****** ** *** ********, financial ********* *** ******* ** **********.

****** **** ********* *** ******** ** an "** ****** *********" *****, *********, includes *** ***** ********** ******* ** Schneider **************** ************ *** **** ***-*** ******. ********** has ** ****** ********** ** ************* *********-**********.

**********

****** ***** ********* ********* *** *****'* global ******* *****, ****** ** * protected **** ****** *** ****** ******. Whether **** ** ******** ** *** current *** ** **-***** ******** *** unprecedented *** ************ ******** ******* ** be ****. ************, ******, ** ******** on **** ***, ****** ***** * long-term ****** ** ********* *** *****.

Comments (5)
Avatar
Gerald Becker
Aug 30, 2019
Quanergy Solutions

***** **** *******! ******** ***** ******* into *** ****** ** *****.

JH
John Honovich
Dec 09, 2019
IPVM

******'* ******* ********** ********* ** ********** going ** ** $*** ******* ******* in ****,*** *******:

******* *** **** ******* ** ******** by **** **** ***% ****-**-**** ** around $*** *******, *** ******* ******** with *** ****** ****.

*** *** ******** *** ********* ***** to ** $*+ ******* ** ******* this ****, ***** ***** ********* ** 5x *** ****** **** ***** ***-***** facial *********** / ***** ************ ** provider ******** **** ** **** ****.

JH
John Honovich
Apr 06, 2020
IPVM

******:********* ******** ******** **** ** ******, "********* ** ********* ******* *** *********" they *** ****:

**** ******* * **** *.*% ** 2019’s ****** **** ***** **** **** tripling ***** ** *** ***** *** months ** *** ****...

****** **** ***** ** *** ****** for *.* ******* **** ($*** *******) ** ***** ** ****** **%, a ****** ******** **** *** ****** said, ****** *** ** ** ********** discussing ******** *******.

********* ***** ****, ************, **** *********** fever ******* *** *** *** ******* stream *** *** *******.

IC
Isabella Cheng
Jan 14, 2021
IPVMU Certified

****** ** ******* ** *** * new *** ***** ******* ** ****** through **** *** ******* **** ** released *** ***** ********** **** ** August ****. ** ** ********* ******* when ****** **** ****.

** ********* ****, ************ * ******* ********** ********* **** CITIC ********** *** ***** ** **** on *** **** ***** ******* ***** Depository ******** (***), ********* *** ************ *** ******* ********** ********** ****** posted ** ******* **, ****. **** are **** ** ***** ***-*****-***** ********* within *****. ****** ** ********** ********** in *** ****** *******.

**** ************ *** *** ******* **** any **** ****** ********* ****. **** will ****** *********** ** ** ***** Megvii's ***.

U
Undisclosed #1
Jan 15, 2021

* ** ** ******* ** *** VC$$$ *********. ******* *** ******* ***** should ***** ********* ***** ** ****** trajectories.