This is Mobileye's second IPO, but its valuation has
plummeted. Mobileye was valued at about $50 billion when Intel
"secretly" filed with the SEC in March. However, Mobileye has
recently updated its prospectus again. Based on the number of shares issued and
the issue price, its valuation has been reduced to about US$14.4-16 billion,
which is similar to the valuation at the time of Intel's acquisition.
Although the decline in valuation cannot ignore macro
factors, more importantly, the overlord of the ADAS era is gradually losing its
edge.
On the one hand, in the face of the siege of startup
competitors such as NVIDIA, Qualcomm, and even Horizon, Mobileye's computing
power is stretched. Compared with the 254TOPS computing power of NVIDIA's Orin
chip in the same period, the computing power of EYEQ5 is only 24TOPS; on the
other hand, The "black box" solution with highly coupled software and
hardware has been unable to adapt to the development of car companies. New car
companies such as Weilai and Ideal have abandoned them one after another, and
even traditional car companies such as BMW, Volkswagen, GM, Mercedes-Benz and
other customers have followed suit. Switch to another platform.
In the new round of competition in the ADAS market,
Mobileye is slowly falling behind.
But even if the macro environment is not optimistic and
the business is cold, Intel still wants to list Mobileye at this time. What is
the reason?
Combined with Intel's second-quarter financial report
this year, revenue was US$15.321 billion, down 22% year-on-year; net loss was
US$454 million, turning from profit to loss year-on-year, the first net loss in
nearly 30 years. After the earnings report, Intel's stock price fell 10%.
Also, Intel has struggled in the chip market. Not only
will it be threatened by rivals such as AMD and Apple, but the total CPU market
share has also dropped from nearly 80% a year ago to less than 65%.
Gone are the days of "Intel inside".
In the prospectus, Mobileye said the IPO proceeds will be
used for working capital and general corporate purposes, and to repay some of
Intel's debt.
That is to say, the purpose of Intel's spin-off of
Mobileye this time is not only for the prospect of autonomous driving, but also
for self-help.
However, it is not so easy to use subsidiaries to fight
fires, and Mobileye's position in the market is also at risk.
Forerunners
lack strength
Despite the constant rumors, it is undeniable that
Mobileye is still the leader in the ADAS market.
Since its establishment in 1999, Mobileye has quickly won
most of the market share in the ADAS field, with a global market share of up to
70%, including Nissan, Cadillac , BMW, GM, Volkswagen and other auto
manufacturers have deployed Mobileye's ADAS solutions. For a long time, the
other players only got their share.
Behind the high market share, on the one hand, for some
car companies that do not have the ability to self-research algorithms,
Mobileye is the best choice for "getting on" autonomous driving. In
addition, Mobileye cooperates with Tier-1 manufacturers by providing
self-developed chips and algorithms. After packaging the chips and algorithms,
Mobileye provides autonomous driving solutions to OEMs, thereby accumulating a
huge customer base.
In terms of financial data, Mobileye’s prospectus shows that
in the first half of 2022, Mobileye’s revenue was $854 million, and in fiscal
2021, Mobileye’s revenue was $1.386 billion, a year-on-year increase of 43%.
Revenues were $879 million and $967 million, respectively. From 2019 to 2021,
Mobileye's EyeQ SoC shipments were 17.5 million, 19.7 million, and 28.1
million, respectively. The actual shipment in the first half of 2022 was 16
million, and shipments are also increasing year after year.
In 2021, Mobileye will be at its peak.
But after the debut of the new car-making force, the
situation of the Mobileye family's dominance began to change.
Although Mobileye still maintains a leading position in
the industry in terms of shipments and revenue, it has become an indisputable
fact that it is not favored by the new forces of car manufacturers.
In 2016, Tesla took the lead in abandoning Mobileye.
Since then, "Wei Xiaoli" who adopted the Mobileye EyeQ4 chip also
left it and turned into the arms of NVIDIA Orin. In addition to the new
car-making forces, even traditional major customers such as BMW, Volkswagen,
and GM have successively announced their "breakup" with Mobileye.
Mobileye was "disgusted" because the previous
"black box" ADAS solution was no longer viable for new energy smart
vehicles.
In order to achieve higher perception capabilities, most
smart cars use multi-sensor fusion perception solutions, and the increase in
the number of sensors also increases the requirements for computing power. The
computing power requirement of L2 autonomous driving only requires 2-2.5TOPS,
but the computing power requirement of L3 autonomous driving requires
20-30TOPS, and it needs more than 200TOPS to L4.
Comparing the chips of different companies, it can be found
that Mobileye's EyeQ chip does not have an advantage in computing power. Taking
EyeQ5 as an example, the computing power of a single chip is 24TOPS, while
NVIDIA's Orin single computing power reached 254TOPS in the same period.
Although the newly launched EyeQ Ultra has reached the computing power of
176TOPS, it will not be available until the end of 2023. At present, the
multi-sensor fusion solutions of car companies such as NIO, Zhiji, and Xiaopeng
have relatively high requirements on computing power. For example, Xiaopeng’s
G9 computing power has reached 508Tops, and the computing power of NIO ES7 has
also reached 1016TOPS. , if you use the Mobileye solution, you need to stack
more chips.
At the same time, the long iteration cycle is also what
Mobileye is criticized for. It is reported that the iteration speed of Mobileye
EyeQ chip is 3-4 years, and there is a gap of 4 years between the release time
of EyeQ3 and EyeQ4. Nvidia's product update cycle is 2 years, and Qualcomm's is
1 year.
With the deepening of automobile intelligence, users have
also put forward a lot of personalized needs. Facing the needs of users, car
companies cannot rely on the same set of solutions if they want to
differentiate themselves. After 2020, with the new car-making forces such as
Ideal and Xiaopeng abandoning Mobileye successively, the unbundling of software
and hardware has also become a key word for car companies.
And this is undoubtedly a fatal blow for Mobileye, which
is highly coupled with software and hardware. Because Mobileye's closed black
box solution does not support car companies to modify the algorithms, and
vehicle data is not shared with car companies, before Mobileye and Jikr
provided the highway driving assistance software package to Jikr 001 through
OTA this year, many times Car companies cannot independently upgrade software
through Mobileye's black box solution, which greatly limits the freedom of car
companies.
According to SAIC Chairman Chen Hong's "Soul
Theory", autonomous driving capability is the core competitiveness of car
companies, and Mobileye's bundled sales model is tantamount to holding the
lifeblood of car companies in their hands. , especially dangerous.
Cheng also Xiao He defeated Xiao He. Mobileye started out
because of the business model of software and hardware packaged and sold, and
now it is deeply shackled by this model.
Insufficient computing power, long iteration cycle, and
high coupling of software and hardware have resulted in the lack of stamina for
Mobileye, a pioneer. It is not difficult to understand why Mobileye's valuation
will be adjusted again and again: the capital market does not buy it, not
because its current situation is not good, but because it is not optimistic
about its future expectations.
Changes to Mobileye
Times have changed, and Mobileye has to wake up from a
sweet dream.
Mobileye, which has lost customers, has fallen behind in
technology, and is deeply stuck in development bottlenecks, is naturally aware
of the current unfavorable situation and has tried to make changes.
As early as 2018, Mobileye founder Amnon Shashua
announced that starting from the next chip EyeQ5, Mobileye's business model
will be changed from closed to open. Judging from the subsequent release of
EyeQ5, this open version of the chip does support programmable operations.
At the 2022 CES exhibition at the beginning of this year,
Mobileye launched the EyeQ Ultra system integrated chip with a computing power
of 176TOPS. It adopts a 5nm process technology and consumes less than 100W. The
main goal of this chip is to achieve L4 autonomous driving.
At the same time, there are two new EyeQ SoCs, EyeQ 6L and
EyeQ 6H. The former is aimed at L1~L2 autonomous driving, while the latter
focuses on solving all L2+ ADAS functions, and can also support third-party
applications including visual parking and driver monitoring.
It is worth noting that in order to allow car companies
to gain more flexibility in the EyeQ 6H and EyeQ Ultra chips, in July this
year, Mobileye released the EyeQ Kit, a software development kit, to provide
car companies with a more open ecosystem. and rich development tools.
Specifically, EyeQ Kit enables car companies to develop
software freely on the platform, and supports the embedding of third-party
application software, thereby reducing costs. In addition, automakers can use
the EyeQ Kit to gain access to a full suite of Mobileye solutions including
computer vision, road information management (REM) autonomous vehicle mapping technology
and other driving strategies.
Simply put, this toolkit allows car companies to obtain
complete services based on Mobileye’s years of technology accumulation, and can
be customized and developed according to user needs to achieve differentiation.
Based on these changes, it is not difficult to see that
Mobileye is gradually letting go, and gradually transforming from a pure
"chip + algorithm" supplier to a high-level autonomous driving travel
service provider.
But judging from the current situation, except that the
new car jointly developed by Krypton and Mobileye will be equipped with six
EyeQ 5 system integrated chips, there is no news about other car companies and
Tier 1 equipped with EyeQ 6 and EyeQ Ultra chips. .
It’s not good to be closed. Now that customers are open,
they still don’t buy it. Where is the problem?
First of all, Mobileye's openness is limited, and the
role of EyeQ Kit is limited to the two newly released chips, EyeQ 6H and EyeQ
Ultra, while EyeQ 6L is mainly for the L1-L2 assisted driving market.
Second, the current business model of autonomous driving
solutions has also changed. The mainstream solution is that car companies
choose sensors and algorithms provided by different suppliers or self-developed
algorithms after selecting chips based on product performance and cost
considerations. For example, the ideal autonomous driving solution is NVIDIA
Orin + Hesai LiDAR + self-developed autonomous driving algorithm. Although
Mobileye has decoupled software and hardware, the problem is that many car
companies have insufficient algorithm development capabilities, and even if
Mobileye provides tools, they will not be able to use or not work well.
Image: Nvidia Orin
In addition, Mobileye's changes are slightly "long
overdue". At present, NVIDIA's Orin has achieved mass production, and not
long ago, its Thor chip with a computing power of up to 2000TOPS has also come
out. Mobileye's EyeQ Ultra, which can meet L4 autonomous driving, will not be
available until the end of 2023.
It's too late to wake up, how should Mobileye find new
breaking points? For Mobileye, the night ahead may be even longer.
AB side of the coin
The former king fell to the altar, and the plot of
"Scarring Zhongyong" was repeated on Mobileye, but at the same time,
through the rise and fall of Mobileye, we can also see that the pattern of the
entire industry is being reshaped.
Pictured: Intel CEO Henry Kissinger
From an international point of view, the previous
"three-legged" situation of Mobileye, Nvidia and Qualcomm began to
disintegrate, and Nvidia's momentum was particularly strong. Although NVIDIA
can't beat Mobileye in terms of market share for the time being, from the
perspective of computing power and customer acceptance, NVIDIA's performance on
autonomous driving chips is even brighter. In addition to sitting firmly on the
throne of chips in the smart cockpit, Qualcomm has also been actively deploying
autonomous driving chips in the past two years. It is reported that all
Volkswagen car brands will use Qualcomm self-driving SoCs from 2026.
Mobileye's prospectus shows that China is Mobileye's
second largest revenue region after the United States, but in recent years, the
development of China's autonomous driving chip industry has not been inferior.
At present, Huawei's MDC intelligent driving computing platform has released
four products with different computing power, MDC210, MDC300, MDC610 and
MDC810. BAIC Polar Fox HI, Great Wall Auto Salon Mecha Dragon, and Nezha S all
use the MDC 810 computing platform, with a computing power of up to 400TOPS.
In addition, the domestic core forces represented by
Horizon, Black Sesame Intelligence and Xinchi Technology also have the momentum
of "shooting the front waves on the beach". Take Horizon's newly
released Journey 5 as an example. After the release of Journey 5, the Ideal L8
Pro became the first model in the world to adopt the Horizon Journey 5, and the
L7 Pro will also be equipped with the Horizon Journey 5. In addition, the
Journey 5 also won BYD and FAW Hongqi's models. Order.
Old rivals are chasing after them, new players continue
to exert their strength, and Mobileye is struggling.
So why is Intel sending Mobileye to the stock market at
this time?
Backed by the big Intel tree, Mobileye's old capital can
still eat for several years. But the fact is that Intel’s revenue in the second
quarter of this year was US$15.321 billion, a year-on-year decrease of 22%. It
was the first time in 30 years that it had a net loss. After the financial
report was announced, Intel’s stock price fell by 10%. And in order to cut
costs, Intel is planning to lay off thousands of jobs recently.
On the contrary, with the good momentum of autonomous
driving, Mobileye's revenue in the second quarter of 2022 increased by 41%
year-on-year to $460 million, which is Intel's fastest-growing business.
However, Mobileye's state is not optimistic. Mobileye
posted a net loss of $75 million in the fiscal year ended December 25, 2021,
compared with $328 million and $196 million in the last two fiscal years.
There may be two reasons for Mobileye to be spun off and
listed at this time: one is to understand Intel's urgent needs; the other is to
use the power of capital to accelerate the development of Mobileye before the
large-scale application of autonomous driving.
"For Intel, this is a very right time. Now the
market has very high growth expectations for EyeQ5, autonomous driving
platforms and other businesses. Therefore, Intel can get the most from the
market's high expectations." Analysis by Morgan Stanley Teacher Harlan Sur
wrote in the research report.
In fact, as early as December last year, Intel had
already announced plans to spin off Mobileye. At that time, Intel CEO Henry
Kissinger said that most of the funds raised will be used to build more chip
factories. In addition to building factories, the independent Mobileye can also
ease Intel's financial pressure. In this prospectus, Mobileye stated that the
IPO proceeds will be used for working capital and general corporate purposes,
and to repay some of Intel's debt.
From Intel's point of view, it has been losing ground in the
"game" with AMD, and AMD is occupying more and more server and PC
market share. In the competition with Nvidia, the latter also took away a lot
of the cake in the GPU field, resulting in Intel's living space being gradually
squeezed.
Therefore, for Intel, it is the top priority to spend money
on R&D.
However, although Mobileye is also difficult to protect
itself, after all, the thin dead camel is bigger than the horse, and Mobileye
itself also has many advantages and market opportunities.
At this stage, the focus of autonomous driving chips has
changed from emphasizing large computing power to more cost-effectiveness.
Mobileye, which started with a "low-cost, low-power" cost-effective
solution, still maintains a fine tradition of doing its best on the premise of
ensuring performance. Possibly reduce power consumption and cost. For example,
the EyeQ 6L, the follow-up product of the EYEQ 4, is only 55% of the price of
the EYEQ 4. Although the power consumption information has not been disclosed
yet, it is officially said that this is an ultra-low power consumption chip.
In addition, Mobileye is also actively deploying L4
autonomous driving. At the beginning of the year, it announced a comprehensive
cooperation with Krypton, and plans to launch the world's first L4 autonomous
vehicle in 2024.
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