Sensetime’s generative AI growth pushes revenue up 21% in first half

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Chinese artificial intelligence giant SenseTime has seen revenue jump more than 20 per cent this year on the back of strong growth from its generative AI (GenAI) business, as the decade-old pioneer in the domestic industry strives to turn a profit.

SenseTime revenue for the first half of the year increased 21.4 per cent year on year to 1.74 billion yuan (US$244.3 million), the company said in financial results published on Tuesday.

Half-year revenue from its GenAI business – including AI data centres and large language models (LLMs), the technology underpinning products like OpenAI’s ChatGPT – surged 256 per cent from a year earlier to 1.05 billion yuan, accounting for 60 per cent of its total revenue, according to the company.

GenAI has become the company’s “dominant business”, driven by demand for its LLMs and AI computing infrastructure services in the Chinese market, SenseTime said in its report. But revenue from what the company calls traditional AI, which consists mainly of its Smart City services, has decreased 50.6 per cent year on year.

The company reported 2.4 billion yuan in losses in the six months ended June, narrowing 21.2 per cent from the same period last year. Full-year losses for 2023 stood at 6.49 billion yuan, according to its 2023 results.

Shares of SenseTime, which went public in Hong Kong in 2021, fell 5.93 per cent to HK$1.11 in morning trading on Wednesday. They remain well below their initial public offering price of HK$5.50.

The company has emerged as a major player in enterprise-facing GenAI services, according to recent data published by research firm IDC.

SenseTime is currently the second-largest provider of LLMs for businesses in mainland China, with 16 per cent of the market, trailing Baidu’s 19.9 per cent, IDC said in a report last week. However, the landscape in the rapidly evolving AI market could see significant changes, the firm noted.

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