Hello, I'm your financial analysis assistant. This news article about "Green Harmonic" tells a very typical story of how a company that was at the forefront of a trend (the "pig on the wind") has to adapt to a change in that trend.
In simple terms, humanoid robots have become popular, and Green Harmonic, which manufactures the core components (reducers), has made its first big profit. However, it realized that its competitors are engaging in price wars, and customers are starting to want to produce their own components, making the business of just selling parts increasingly difficult. As a result, Green Harmonic decided to change its strategy: it will raise funds on the Hong Kong stock market while developing more complex "joint components" and even planning a "Plan B" (no longer relying solely on harmonic reducers).
Let me break down this news into five key points to help you understand the underlying logic in plain language.
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1. impressive performance, but declining value: The dilemma of increased volume and lower profit margins
Key point: Although sales have increased, profits are not as easy to come by.
The news mentions that in the first half of 2026 (note: there might be a timekeeping error in the original text; it should refer to recent or 2025 data, but I'll interpret it based on the current context as the latest financial report period), Green Harmonic's revenue grew by 38%, and its profit increased by 31%. That sounds good, right? After all, humanoid robots (embodied intelligence) have started to be mass-produced, and key customers like "Customer 19" (likely referring to leading manufacturers like Yuzhu) have moved from sample testing to large-scale purchases.
However, if you look at the "gross margin" indicator, something doesn't seem right:
- Previously: The gross margin for selling one harmonic reducer was around 34% or more.
- Now: The overall gross margin has dropped to around 32%, and the gross margin for its core product, the harmonic reducer, has even decreased by 1.5 percentage points.
Why is the profit margin lower despite higher sales?
It's like running a restaurant: before, you sold 100 bowls of noodles a day, making a profit of 30 yuan per bowl; now, you sell 150 bowls a day, but due to market competition or increased labor and equipment costs, you only make 25 yuan per bowl. Although the total revenue has increased, the value of each yuan has decreased. This indicates that the era of maintaining high profits simply by selling more parts is coming to an end.
2. Competitors are cutting costs: Price wars driven by scale
Key point: Competitors not only have better technology but are also cheaper, which is the most direct threat.
The news mentions a comparison with "Laifu Harmonic," which recently went public on the Hong Kong stock market:
- Laifu's performance: Revenue and shipments have doubled.
- Key change: Its cost per unit has dropped from 482 yuan to 351 yuan, a reduction of 27%, and its gross margin has increased from 20% to 29%.
What does this mean?
It means the industry has entered a phase of "scale competition." Before, the focus was on who had the best technology; now, it's about who has the lowest costs and the highest capacity utilization. Laifu has achieved this through vertical integration (managing more production steps itself) and process optimization. For Green Harmonic, it's like a high-end smartphone manufacturer suddenly facing a competitor with similar specifications but a 20% lower price and much larger production capacity. If Green Harmonic can't reduce its costs, its market share and profit margins will be squeezed.
3. Customers are taking control of their supply chains: Manufacturers are starting to develop their own core components
Key point: Previously, robot companies like Yuzhu relied on Green Harmonic for components; now, they are developing everything themselves.
- Why? When robot sales were in the hundreds, it wasn't economical for them to build their own production lines. But with sales reaching tens of thousands, producing components in-house can significantly reduce costs (BOM costs) and speed up product iteration.
- Consequence: Green Harmonic realizes that a customer like "Customer 9" might buy its reducers today and then build its own production line tomorrow due to strategic changes, no longer relying on Green Harmonic.
This is like: You used to supply tires to car manufacturers, but now they say, "We want to build our own tire factory." Your business is at risk.
Green Harmonic is under dual pressure: competitors are cutting prices, and customers are taking over the supply chain.
4. Green Harmonic's "Plan B": Moving from selling parts to selling complete modules
Key point: Since selling parts alone isn't enough, it plans to sell semi-finished or fully assembled modules.
In response to these challenges, Green Harmonic has taken two key actions:
Action 1: Diversify its product range. It used to specialize in harmonic reducers (a type of rotary joint component). Now, it's developing planetary reducers, ball screws (for linear motion), and integrated electric cylinders.
- Purpose: The joint structures of humanoid robots are not yet standardized. Some use harmonic reducers, some use planetary reducers, and some use ball screws. If Green Harmonic only focuses on harmonic reducers, it might be out of the game if future trends change. By covering various technologies, it ensures it can serve all customers.
Action 2: Deepen its product offerings. It's moving from selling simple components to selling complete joint modules.**
A joint module includes a reducer, motor, encoder, and even control algorithms.
- Why this? If customers want to develop their own components, integrating the motor, reducer, sensors, and control board is time-consuming, costly, and prone to errors. Green Harmonic provides a ready-to-use module that saves them this hassle.
- Logic: By offering integrated solutions, it counteracts customers' desire to develop everything themselves, arguing that while self-development might be cheaper, it's slower, more expensive, and more error-prone.
5. Strategic moves: Listing on the Hong Kong stock market and investing in flexible manufacturing
Key point: Listing on the Hong Kong stock market allows for international financing, especially for strategic acquisitions and research and development. Green Harmonic may use the funds to acquire overseas teams or technologies to address weaknesses in areas like planetary reducers and control algorithms.
- Why delay capacity expansion? The original plan to produce 1 million units by the end of 2026 has been postponed to 2028.
This might seem contradictory since there seem to be many orders. The reason is that the humanoid robot market is not yet at the stage where large-scale standardization is necessary. Orders are diverse: one customer wants one specification, another another, and so on. Building large-scale standardized production lines would be inefficient if customer needs change. Instead, Green Harmonic is investing 100 million yuan in a "flexible manufacturing system" that can quickly switch between different types of reducers.
Conclusion: Green Harmonic is experiencing a period of identity anxiety and evolution.
The core logic of this news is as follows:
1. The era of easy profits from the humanoid robot boom is ending due to price cuts and customer self-development.
2. The competition has shifted from technical precision to cost and scale, as well as integration capabilities.
3. Green Harmonic's strategies include:
- Diversifying its technology to avoid reliance on a single product.
- Upgrading its products to provide integrated solutions to retain customers.
- Adjusting its manufacturing to be more flexible and responsive to diverse demands.
- Using capital to acquire new technologies and capabilities.
Implications for everyone: If you follow the robotics industry, focus not on who sells the most but on who holds the power to define standards. Green Harmonic is trying to transform from a passive parts supplier into a provider of modular solutions that define joint standards. If it succeeds, its valuation will shift from a manufacturing company to a technology integration company, potentially opening up new profit opportunities. However, if it can't develop faster, cheaper, or more reliably than its customers, it may face difficulties.
This is a battle over the重新 definition of supply chain boundaries, and Green Harmonic is working to secure a strong position in the value chain.