PATEO (02889) announced its financial results for the first quarter of 2026, with the group achieving a year-on-year revenue increase exceeding 100% and a significant improvement in operating profit margin. The substantial revenue growth compared to the same period last year is primarily attributed to: (1) the effectiveness of the company's strategy to upgrade its intelligent cockpit solutions, with high-end solutions showing robust growth; (2) increased contributions from overseas markets, as aftermarket intelligent cockpit projects for internationally renowned luxury brands have commenced global deliveries; and (3) the expansion of AI applications and business, with AI software and cloud-based intelligent services contributing new incremental revenue.
From the perspective of business execution and strategic positioning, the company has further strengthened its market leadership in the AI integration and premium segment of intelligent cockpit solutions. Its flagship product based on the Snapdragon 8295 platform continues to see increased adoption among domestic OEMs. Concurrently, the company's collaboration on intelligent cockpits using the Kirin 9610A high-end platform is deepening, with downstream demand growing rapidly. With the mass production and delivery of Qualcomm's next-generation 8397/8797 platforms and the launch of new Harmony Intelligent Driving models, the market penetration of large AI models on the vehicle side is expected to rise continuously. The company is poised to benefit from the industry trend of simultaneous volume and price increases for high-end intelligent cockpit solutions.
The company's overseas operations continue to make positive progress, accelerating the advancement of its globalization strategy. Focusing on intelligent cockpits, AI, and vehicle intelligence, PATEO is deepening its cooperation and exchanges with leading international OEMs, global technology firms, and industry ecosystem partners. Its brand influence and business opportunities in key markets such as Europe and Japan are steadily increasing. Notably, a premium aftermarket intelligent cockpit project developed in collaboration with an internationally renowned luxury automotive brand has successfully passed customer acceptance. The related products will be sold and delivered in global markets including Europe and the Middle East. Testing and validation for another overseas luxury brand's front-load intelligent cockpit project are nearing completion, gradually moving into the customer acceptance and mass production preparation phase.
Regarding overseas talent development and localized operations, the company has officially appointed Dr. Stefan Ortmanns as the Head of European Business, who will be fully responsible for strategic planning and business expansion in the European market, further accelerating the company's globalization process and local operational capabilities.
At the ecosystem cooperation level, PATEO recently signed a strategic cooperation agreement with Omowei Group. The two parties will engage in joint development focused on high-performance cross-domain integration and general artificial intelligence technologies, aiming to jointly expand the global market for Software-Defined Vehicle (SDV) domain controllers and AGI applications. Furthermore, the company has established a strategic partnership with Horizon Robotics. They will collaborate to form platform-level overseas solutions in the two core areas of intelligent cockpits and intelligent driving. By integrating customer resources both domestically and internationally, they aim to create comprehensive solutions tailored to local needs, promoting the global export of "Chinese solutions."
The company is actively advancing its AI-centric strategic layout, continuously increasing R&D investment around the deployment and application of large AI models. It has built an AI technology system encompassing on-device model deployment, cloud service coordination, multimodal interaction, and AI Agents. Leveraging NVIDIA's accelerated computing chips, the company is developing large vehicle-side models and actively exploring the deployment of AI BOX in vehicles. Its projects are strategically positioned in cutting-edge areas such as Physical AI and AI Agents, while exploring innovative business models like computing power billing and in-vehicle token-based charging.
Regarding mergers and acquisitions, the company has recently reached cooperation intentions with Ping An Capital and China Minsheng Bank respectively. Ping An Capital will provide various forms of financial support totaling up to $10 billion, while China Minsheng Bank will offer an indicative credit line of up to RMB 2.5 billion. The company will, at an opportune time in the future, pursue mergers and acquisitions that align with shareholder interests and its strategic development direction.
PATEO will continue to focus on AI technology as its core, adhering to the strategic direction of integrating software, hardware, chips, and cloud services. It aims to provide AI solutions for the automotive and mobile terminal industries and build a comprehensive AI application ecosystem.