Goldman Sachs maintains Buy on Roborock, expecting 2Q growth resilience to be stronger than market concerns

Overview

This report is Goldman Sachs' preview of 2Q26 earnings for leading Chinese cleaning appliance/RVC companies, focusing on Roborock and Ecovacs. Although both companies' share prices have underperformed the durable consumer goods coverage universe and the CSI300 year to date, and the market is concerned about a high domestic base, slowing overseas demand, intensifying competition, and cost and FX pressure, the report believes the industry's and leaders' fundamentals in 2Q26 remain broadly resilient.

Core views

The core view is that Roborock is superior to Ecovacs. Goldman Sachs expects Roborock's 2Q26 revenue/profit to grow about 27%/20% YoY, benefiting from RVC share gains, floor washer expansion, overseas channel expansion, and margin recovery driven by reduced investment in the washer-dryer business; Ecovacs is expected to post about 15%/15% YoY revenue/profit growth, which is healthy but relatively slower, while facing greater pressure from domestic competition and a high base. The report maintains Buy on Roborock and Sell on Ecovacs.

Analysis framework

The report analyzes multiple dimensions including demand, market share, pricing, margins, EPS revisions, target price, and relative risk-reward. On demand, it uses domestic 618 data, Moojing market share, RVC app downloads, Amazon US sales, and ASP data; on earnings, it evaluates factors such as costs, FX, expense ROI, contraction in loss-making businesses, tariff refunds, and investment income; on valuation, it uses 2028E EPS, exit P/E multiples, and discounts back to 2027E using a 9.5% cost of equity.

Methodology notes

• Valuation methodsExit P/E discounted target price

  Multiply 2028E EPS by the target exit P/E and discount it back to 2027E using a 9.5% cost of equity to derive the 12-month target price.

  Roborock's Rmb170 target price is based on a 17x exit P/E; Ecovacs' Rmb56 target price is based on a 16x exit P/E.

• Factor analysisGS Factor Profile

  Goldman Sachs compares stocks against the market and industry peers using four attributes: Growth, Financial Returns, Multiple, and Integrated.

  Growth is based on forward sales, EBITDA, and EPS growth; Financial Returns are based on ROE, ROCE, and CROCI; Multiple is based on valuation metrics such as P/E, P/B, dividend yield, EV/EBITDA, and EV/FCF.

• M&A scoringM&A Rank

  Goldman Sachs assigns scores from 1 to 3 to rate the probability of covered companies being acquired.

  1 indicates high probability, 2 indicates medium probability, and 3 indicates low probability; if a company is rated 1 or 2, M&A factors may be incorporated into the target price.

Asset mapping & comparison

Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).

• Beijing Roborock Technology (688169.SS)

  Core recommended name, rated Buy by Goldman Sachs.

  Strengths

  A global RVC leader with expanding overseas channels, including entry into US offline retail channels such as COSTCO; domestic and overseas share gains, expansion into new categories such as floor washers and robotic lawn mowers, and potential margin recovery after reduced investment in loss-making businesses.

  Weaknesses

  Still exposed to costs, FX, competition, and potential increases in US tariffs; marketing investment in new categories could also weigh on profitability.

  Comparison

  Compared with Ecovacs, Roborock is growing faster, seeing more visible overseas share gains, and showing stronger resilience in an industry slowdown scenario.

  Risks

  Intensifying competition at home and abroad, slower-than-expected new product launches or expansion into new categories, excessively high marketing investment for new products, weaker consumer confidence due to macro softness, and higher US tariffs.

• Ecovacs Robotics Co. (603486.SS)

  Peer comparison name, rated Sell by Goldman Sachs.

  Strengths

  One of China's cleaning appliance leaders, with dual brands Ecovacs and Tineco, online and offline channels, and a full product portfolio; it still has room to gain overseas share.

  Weaknesses

  Greater competitive pressure in domestic RVC and floor washers, higher risk of slower growth under a high base, and maintaining share may hurt margins.

  Comparison

  Compared with Roborock, Ecovacs is expected to grow more slowly in 2Q26 and offers inferior risk-reward.

  Risks

  If macro demand recovers faster, product development/expansion exceeds expectations, or competition eases, Ecovacs could face upside risk.

Key data

• Expected 2Q26 YoY revenue/profit growth for Roborock+27%/+20%The report expects Roborock to continue outperforming the industry, with accelerating revenue and margin recovery.
• Expected 2Q26 YoY revenue/profit growth for Ecovacs+15%/+15%Growth is mainly driven by overseas revenue and investment income, but is slightly slower than Roborock.
• Roborock domestic online market shareRVC 35%, floor washers 29%Moojing data show YoY gains of 10ppt/13ppt in 2Q26 across JD and Taobao+Tmall channels.
• Ecovacs/Tineco domestic online market shareRVC 30%, floor washers 28%Up 2ppt/down 3ppt YoY respectively, broadly stable overall.
• Overseas RVC industry growthabout 40% YoY growthBoth app downloads and Amazon US sales data show overseas demand remained strong in 2Q26.
• Roborock overseas download growthabout 55% YoY growthThe report believes Roborock has achieved notable market share gains in markets such as the US.
• Roborock EPS revision2026E-28E raised by 3%-12%Reflects improved assumptions for demand, share, and margins.
• Roborock target priceRmb170Based on 2028E EPS, 17x exit P/E, and discounting at a 9.5% cost of equity.
• Ecovacs target priceRmb56Based on 2028E EPS, 16x exit P/E, and discounting at a 9.5% cost of equity.

Impact & implications

The report's investment implication for Roborock is positive: against the backdrop of pressure on industry valuations and share prices, if domestic demand resilience, overseas channel expansion, and margin recovery continue to materialize, Roborock has favorable relative return potential. For the industry, RVC pricing is more stable than floor washers, overseas growth is faster than domestic growth, and leading Chinese brands continue to gain global share, which are the main themes over the short to medium term; however, competition, geopolitics, tariffs, energy prices, and FX will still affect earnings visibility.

Risks

• Competition in domestic and overseas markets may intensify, especially from rivals such as Dreame, potentially creating pressure on pricing and margins.
• Overseas demand may be dragged down by elevated energy prices, geopolitics, and weak macro consumption.
• Cost inflation, FX volatility, and changes in US tariffs may affect profitability.
• Slower-than-expected expansion into new categories or product launches could weaken incremental revenue.
• Overly aggressive marketing and brand investment could compress near-term margins.

What to watch

• Roborock's sales contribution from US offline channels, especially COSTCO.
• Ongoing growth in RVCs and floor washers across Europe, the US, and APAC markets.
• Whether demand continues after the domestic 618 shopping festival, and whether industry growth slows under a high base.
• ASP trends for RVCs and floor washers, especially online pricing pressure for floor washers.
• Whether expansion or subsidy strategies by competitors such as Dreame intensify again.
• The actual contribution of tariff refunds, investment income, and contraction in loss-making businesses to margins.