Nomura Initiates Coverage on Unitree Robotics: Bullish on 'Cost Blade' Advantage, Sets $150 Billion Market Cap Target

According to mainland media reports, Nomura Securities recently released its inaugural coverage report on Unitree Robotics, China’s leading robotics pioneer, assigning a 'Buy' rating and setting a target price of CNY 370 per share—corresponding to a market valuation of approximately CNY 150 billion.

This report reveals how Unitree Robotics has emerged as the world’s only humanoid robot manufacturer achieving scalable profitability, overcoming fierce competition through extreme cost control and astonishing product iteration speed.

Full Vertical Hardware Integration: Two Core Moats

Nomura’s report presents a key conclusion: Unitree’s core competitiveness lies not in algorithms, but in hardware vertical integration. The firm develops all hardware components in-house, reducing outsourced parts to just 10–20% of total cost, while launching four humanoid robot models within 26 months—a dual moat that competitors cannot replicate in the short term.

Specifically, Unitree independently designs and manufactures the four core components of robotic joint modules: motors, harmonic/planetary gear reducers, drivers, and LiDAR sensors. In the Bill of Materials (BOM) for humanoid robots, around 80–90% are covered by in-house design, roughly 50% involve both in-house design and manufacturing, and only 10–15% rely on third-party modules.

Nomura believes this 'know-how stays internal, cost stays internal' model enables Unitree to maintain strong cost advantages and gross margins, even as competitors shift toward modular assembly where value flows to suppliers.

Debunking the Myth of 'Unattainable' Humanoid Robots

The report conducts an in-depth analysis of the complete BOM for the G1 base model, revealing a total material cost of only about CNY 41,574. Nomura highlights that the largest hardware cost driver is the 'joint module,' accounting for 66.2% of the entire BOM (32.5% for large joints, 33.7% for small joints)—meaning whoever controls joint costs holds pricing power.

Interestingly, computing modules account for just 3.2% of total cost, with the main processor (SoC) costing around CNY 380. This shows that the cost-reduction logic for humanoid robots differs fundamentally from smartphones or PCs: Moore’s Law offers limited help; the real breakthrough lies in iterative improvements in mechanical design and manufacturing processes.

Nomura emphasizes that U.S.-sourced components represent only a tiny fraction (2–8%) of the base model BOM. Even under potential FCC (Federal Communications Commission) technology supply bans, the actual impact would be relatively limited. The true risk lies not in the supply chain, but in market access.

Financial Health: The Only Profitable Humanoid Robot Company Globally

In contrast to cash-burning peers like Tesla’s Optimus or Boston Dynamics, Unitree’s financial performance stands out as an 'anomaly' in the robotics industry, according to Nomura. For fiscal year 2025, Unitree achieved total revenue of CNY 1.699 billion (up 332.6% year-on-year), with stable gross margins above 60%. Excluding share-based compensation expenses, its Non-GAAP net profit margin reached 34.8%, demonstrating robust profitability.

Revenue structure also reached a pivotal turning point: in 2025, humanoid robot revenue accounted for 51.8% of total sales, surpassing quadruped robots (41.6%) for the first time and becoming the primary revenue source. Unitree adopted a 'volume over price' strategy, reducing the average selling price (ASP) of humanoid robots from CNY 593,000 in 2023 to CNY 166,000 in 2025, while unit sales surged from 5 units to over 5,000.

Nomura forecasts that with new production capacity coming online in 2027, humanoid robot shipments will explode further, potentially reaching 115,000 units by 2028.

Market Reality: The Gap from Research Toy to Industrial Tool

Despite impressive valuations, Nomura remains cautious, noting that current demand for humanoid robots remains heavily concentrated in 'non-productive' domains.

Data shows that approximately 73% of Unitree’s current humanoid robot revenue comes from research institutions. In projected 2026 demand, industrial and commercial innovation scenarios account for only about 5%, with the remainder largely from rentals, performances, consumer use, and government procurement.

Nomura argues that current shipment volumes only validate 'manufacturability,' not 'demand sustainability.' The true inflection point will come when the first repeat order is placed by an unaffiliated industrial customer using operational budgets—not pilot project funds. Additionally, the 'brain' of embodied artificial intelligence (Embodied AI) still requires 2–3 years to mature, and there is currently a 20-fold gap in high-quality physical interaction data—an obstacle that must be overcome before Embodied AI achieves its 'ChatGPT moment.'

Geopolitical Risk: FCC Policy as a Structural Constraint

The report specifically warns investors about the impact of U.S. FCC policy. Starting July 2026, foreign-manufactured (defined by production location, not corporate nationality) advanced robotics equipment will be added to the covered list. While existing models like G1 and H2 are protected under a 'grandfather clause,' new models will be effectively locked out of the U.S. market.

Nomura assesses that FCC restrictions are forward-looking and structural. Although Unitree can hedge by expanding into European, Southeast Asian, and Middle Eastern markets, the long-term uncertainty of U.S. market access remains a key variable limiting further upward revisions to its valuation.