2Q26 Beat Expectations; Share Gains and Business Mix Improvement Drive Profit Recovery

Overview

Ninebot Ltd's 2Q26 results exceeded Goldman Sachs expectations. Revenue growth accelerated mainly driven by stronger-than-expected robotic lawn mower business, while the profit beat benefited from increased contribution from high-margin robotic lawn mowers. Goldman Sachs believes that even amid weak industry demand, the company can continue to gain share through its product portfolio, brand, offline channels, and new product capabilities. Looking to the second half, although robotic lawn mower growth will slow due to seasonality, electric two-wheelers entering peak season, product mix improvement, and stronger discount discipline are expected to sustain growth and drive sequential profit recovery.

Core views

The investment thesis mainly includes three points: first, the domestic electric two-wheeler business continues to gain share through R&D, intelligent features, a dual-brand product matrix, and channel expansion, and is expected to increase service revenue such as membership fees; second, robotic lawn mowers benefit from the structural trend of robots replacing traditional equipment, and the company has further expansion potential through its brand, product portfolio, and offline channels; third, overseas markets provide long-term incremental growth, as rising electric bicycle penetration in developed markets and electrification of fuel-powered two-wheelers in ASEAN could open up growth opportunities. In the short term, accelerated electric two-wheeler sales and product mix improvement are expected to offset seasonal slowdown in robotic lawn mowers, supporting continued revenue growth of over 20% in 3Q26 and further acceleration in revenue and profit on a low base in 4Q26.

Analysis framework

The report derives quarterly performance from semiannual data and compares actual results with Goldman Sachs forecasts and the prior quarter's yoy trend. It then breaks down sales volume, revenue, gross margin, and seasonal changes by electric two-wheelers, electric scooters, robotic lawn mowers, electric bicycles, and all-terrain vehicles, and updates 2026E to 2028E earnings forecasts. Valuation uses a forward P/E methodology, supplemented by comparison of the current valuation with the three-year historical average.

Methodology notes

• Earnings analysisQuarterly earnings derivation method

  Derive second-quarter revenue and profit growth from first-half cumulative data combined with first-quarter performance

  Based on 1H26 cumulative revenue and net profit as well as 1Q26 growth rates, the report estimates 2Q26 revenue growth of 28% yoy and net profit growth of 2% yoy, and compares these with Goldman Sachs forecasts.

• Earnings forecastSegment forecasting method

  Forecast revenue, growth rates, and margins separately by major product line

  The forecasts focus on peak-season acceleration in electric two-wheelers, seasonal changes in robotic lawn mowers, customer mix in electric scooters, regional expansion of all-terrain vehicles, and gross margin differences across businesses.

• Valuation methodsForward P/E valuation method

  Target price is determined by forward EPS, exit P/E, and cost of equity

  The Rmb64 target price is based on 2028E EPS applying a 16x exit P/E and discounted to 2027E using a 9.5% cost of equity.

• Relative valuationHistorical valuation range comparison

  Compare the current forward P/E with the company's historical average

  The company currently trades at about 17x and 12x 2026E and 2027E P/E, below its three-year average forward P/E of about 21x, supporting the report's positive view on risk-reward.

Asset mapping & comparison

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

• Ninebot Ltd (689009.SS)

  Directly covered company in the report, with Buy rating maintained

  Strengths

  Product portfolio covers electric two-wheelers, scooters, robotic lawn mowers, and all-terrain vehicles; the company has brand, R&D, intelligent capabilities, offline channels, and overseas expansion potential, while a rising share of high-margin businesses helps profit recovery.

  Weaknesses

  Some businesses have clear seasonality; electric two-wheelers are affected by national standard transitions, cost increases, and subsidy phase-outs; robotic lawn mower gross margin is unlikely to recover to the historical level of about 55% in the short term.

  Comparison

  Currently trading at about 17x and 12x 2026E and 2027E P/E, below the three-year average forward P/E of about 21x; the report believes valuation does not match the outlook for sustained share gains and profit recovery.

  Risks

  Weakening macro consumption, delayed new products, intensified competition, tariffs or anti-dumping duties, rising raw material costs, and overseas expansion falling short of expectations.

Key data

• 1H26 revenueRmb14,358mnUp 22% yoy
• 1H26 net profitRmb1,008mnDown 19% yoy
• 2Q26 revenue growthUp 28% yoyAccelerated from 15% in 1Q26 and 1% above Goldman Sachs forecast
• 2Q26 net profit growthUp 2% yoySignificant improvement from a 55% yoy decline in 1Q26 and 8% above Goldman Sachs forecast
• 2Q26 core operating profitUp 22% yoyClear recovery from a 22% yoy decline in 1Q26
• 2026E revenueRmb26,719mnExpected to grow 25.6% yoy
• 2026E operating profitRmb2,279mnExpected to grow 21.5% yoy, with operating margin of 8.5%
• 2026E to 2028E EPSRmb2.45/Rmb3.58/Rmb4.55Raised by 2.1%, 1.9%, and 2.1% versus previous forecasts, respectively
• 2026E robotic lawn mower revenueRmb4,003mnExpected to grow 100% yoy
• Target price and upsideRmb64/51.1%Target price raised from Rmb62; report current price is Rmb42.35

Impact & implications

The earnings beat and upward revision to earnings forecasts reinforce the logic of market share gains and profit recovery. Short-term catalysts come from peak-season electric two-wheeler sales, new product launches, product mix upgrades, and tighter discounting. Medium-term growth is driven by increasing robotic lawn mower penetration, regional expansion of all-terrain vehicles, and electrification in Southeast Asia. If the company achieves revenue growth of over 20% in 3Q26 and further accelerates on a low base in 4Q26, the current forward valuation, which is below the historical average, may re-rate.

Risks

• A weaker macro environment could depress household disposable income and consumer confidence.
• New product launches or expansion into new categories may be slower than expected.
• Intensifying competition in domestic and overseas markets could affect sales volume, pricing, and margins.
• Potential tariffs or anti-dumping duties could weaken the profitability of overseas businesses such as robotic lawn mowers.
• Higher-than-expected raw material costs could further compress gross margins.
• After robotic lawn mowers enter the off-season, growth will fall significantly from the level of over 150% in 2Q26.
• Electric two-wheeler demand remains affected by factors including national standard transitions, cost increases, and subsidy phase-outs.

What to watch

• Whether 3Q26 revenue can continue to grow by more than 20%, and whether profit growth can accelerate sequentially.
• Electric two-wheeler sales volume, average selling price, gross margin, and discount discipline improvement during peak season.
• Whether the growth momentum reflected by 1mn additional electric two-wheeler shipments from end-June to end-July can continue.
• Whether robotic lawn mowers can achieve the 2026 target of doubling sales volume, and whether 2H26 gross margin can improve sequentially.
• Progress in mitigating the impact of potential anti-dumping duties through three partner factories in Southeast Asia.
• Expansion progress in the Vietnam market, growth of all-terrain vehicles in Europe, and development in other overseas regions.
• Launches of new electric bicycle products and delivery of medium- to long-term sales targets.