Gain Insight into Business Nature, Strike at the Core of Enterprises

Author | Chen Ye

On June 12, Seres' (601127.SH, 09927.HK) A-share stock price saw a modest uptick of 1.42%. However, over the preceding eight months, its A-share stock price had plummeted more than 60% from its peak, while its H-share stock price had also tumbled nearly 60%. The combined market capitalization of its A- and H-shares has shrunk by 280 billion yuan.

As a seasoned automaker based in Chongqing, Seres managed to stage a remarkable turnaround by partnering with Huawei to launch the AITO brand.

Recently, the company unveiled the AIVA brand, targeting the AI-driven smart car sector, in what has been termed a move to 'de-Huawei-ize'.

01 Rising Revenues, Stagnant Profits

On the evening of June 11, Seres announced that it had repurchased 885,200 A-share shares through centralized bidding transactions on the same day, accounting for approximately 0.05% of the company's total share capital, with a repurchase amount of 60 million yuan.

This marked Seres' fifth repurchase operation in the past two months, with a cumulative repurchase of over 3.55 million shares and a cumulative amount exceeding 280 million yuan.

Previously, at the end of March 2026, Seres unveiled a repurchase plan, proposing to repurchase 1 billion to 2 billion yuan worth of A-share shares using its own funds within the next 12 months. The repurchased shares would be used entirely for cancellation to reduce registered capital.

From the perspective of the secondary market, Seres' A-share stock price reached an all-time high of 173.55 yuan on September 30, 2025, and has since been on a downward trajectory, hitting a temporary low of 66.46 yuan on June 11, 2026. This represents a plunge of over 60% in more than eight months, with its market value evaporating by over 180 billion yuan, currently standing at less than 120 billion yuan.

Meanwhile, Seres' H-share stock, which made its debut on the Hong Kong Stock Exchange in November 2025, immediately broke its issue price. On June 11, 2026, it hit a new low since its listing at 55.5 Hong Kong dollars. Seres' H-share stock has accumulated a decline of approximately 58%, with its market value evaporating by over 100 billion Hong Kong dollars.

Fundamentally, Seres' performance growth has hit a plateau.

After years of losses, Seres finally turned a profit in 2024. In 2025, it reported revenue of 165.1 billion yuan, a year-on-year increase of 13.69%, hitting a record high. However, its net profit attributable to the parent company was only 5.957 billion yuan, a slight year-on-year increase of 0.18%, while its net profit excluding non-recurring items was 5.136 billion yuan, a year-on-year decrease of 7.84%.

This scenario of 'rising revenues without corresponding profit growth' indicates that Seres is actually making less money.

Financial reports reveal that Seres has significant expenses, particularly in marketing and R&D.

In 2024, Seres' selling expenses reached 19.184 billion yuan and climbed to 24.194 billion yuan in 2025, a 26.12% increase. In 2024, its R&D expenses were 5.586 billion yuan and grew to 7.954 billion yuan in 2025, a 42.41% increase, significantly outpacing revenue growth.

In the first quarter of 2026, Seres reported revenue of 25.746 billion yuan, a year-on-year increase of 34.46%. However, its net profit attributable to the parent company was only 754 million yuan, a year-on-year increase of just 0.89%, including 628 million yuan in government subsidies. Its net profit excluding non-recurring items plummeted to 103 million yuan, a year-on-year decrease of 73.87%. Its gross profit margin dropped to 26.24%, a year-on-year decrease of 1.38% and a quarter-on-quarter decrease of 2.43%.

As of the end of the first quarter of 2026, Seres' asset-liability ratio was 65.92%. In the first quarter of 2026, its net cash flow from operating activities was -20.95 billion yuan, compared to 28.91 billion yuan at the end of 2025.

02 Betting Big on AI for Car Manufacturing

Seres' origins can be traced back to the Phoenix Spring Factory founded by Zhang Xinghai in 1986.

After undergoing multiple business transformations, the company ventured into automotive manufacturing by establishing a joint venture with Dongfeng Motor in 2003, known as Dongfeng Xiaokang. It listed on the Shanghai Stock Exchange in 2016 as 'Xiaokang Shares' and rebranded as 'Seres' in 2022, fully focusing on new energy vehicles.

In the first five months of 2026, Seres' sales data was not encouraging. In January, the company sold 40,012 Seres vehicles (same below); sales plummeted to 10,003 in February, rebounded to 20,234 in March, delivered 30,003 in April, and grew to 30,187 in May. The year-on-year growth rates showed a fluctuating decline, at 143.50%, -33.34%, 47.74%, 10.29%, and -17.18%, respectively.

Seres' profitability is deeply intertwined with Huawei.

In 2021, Seres and Huawei embarked on a cross-border collaboration, empowering each other across the entire chain from R&D, technology, and manufacturing to sales and services. At the end of that year, the deeply collaborative brand 'AITO' was officially launched, followed by the successive introduction of four SUV models: AITO M5, M7, M8, and M9.

In the first quarter of 2026, Seres' cumulative sales of new energy vehicles reached 78,500 units, a year-on-year increase of 43.9%.

The AITO series accounted for approximately 90% of Seres' sales.

The high-end model AITO M9 has cumulatively delivered over 280,000 units, remaining the sales champion in the 500,000-yuan segment for 21 consecutive months. The AITO M8 has cumulatively delivered 160,000 units, retaining the championship in the 400,000-yuan segment.

Notably, since its deep collaboration with Huawei, Seres has paid Huawei over 75 billion yuan in procurement fees from 2022 to 2025, covering comprehensive costs such as parts, technology licensing, and channel services.

Seres expects its associated transaction amount with Huawei-controlled Shenzhen Yinwang Intelligent Technology Co., Ltd. for procurement of goods and acceptance of services in 2026 to reach 26 billion yuan, a year-on-year increase of approximately 16.4% from the 22.335 billion yuan limit in 2025.

A simple calculation reveals that in 2025, with AITO delivering 426,000 units, for every AITO sold, Seres' procurement amount from Shenzhen Yinwang Intelligent Technology Co., Ltd. exceeded 50,000 yuan. Seres is now attempting to reduce its reliance on Huawei and seek new growth avenues.

On June 9, Saido Technology, jointly controlled by the Chongqing State-owned Assets Supervision and Administration Commission, Seres Group, ByteDance, CATL, and others, officially launched the AIVA brand. Collaborating with ByteDance's Volcano Engine, it proposed a car-making path of 'AI defines the car, AI comes first, then the car.'

According to the plan, the AIVA's first model, the ME7, is positioned as a 'crossover coupe SUV,' targeting the mainstream market above 200,000 yuan, and is set to debut in 2026. Before the launch event, AIVA sparked online discussions due to the similarity of its brand name in design to Avatr.

Li Bo, President of the AIVA brand, explained the origin of the AIVA name, which stands for Artificial Intelligence Voyage Ahead, symbolizing AI accompanying users on their journey forward and seeing the future, while also being homophonous with 'love me'.

The exposure of the Saido Technology brand led the outside world to equate Saido with 'Doubao Car' and 'ByteDance car manufacturing.'

ByteDance officially clarified, 'Saido is not a car brand launched by ByteDance or Doubao, and ByteDance has no equity cooperation with Saido,' emphasizing that 'ByteDance has no plans to manufacture cars or launch a car brand.'

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The images in this article are sourced from the internet.