Hesai Group appeals DoD designation to U.S. Court of Appeals

SHANGHAI - Hesai Group (NASDAQ:HSAI), a lidar solutions provider with a market capitalization of $3.17 billion, announced Monday it has filed a Notice of Appeal challenging the U.S. District Court for the District of Columbia’s decision that upheld its designation under Section 1260H of the National Defense Authorization Act. The company’s stock has shown remarkable performance, delivering a 395% return over the past year according to InvestingPro data.

The appeal, filed July 13, contests the U.S. Department of Defense designation which Hesai claims "lacks both factual and legal bases," according to CEO Yifan David Li.

In its statement, Hesai noted the District Court acknowledged the DoD found no evidence that Hesai’s products have been used for military purposes, nor any direct or indirect connection between the company and the Chinese military.

The court’s decision instead focused on the location of Hesai’s R&D centers within certain industrial districts and the theoretical potential for lidar technology to have military applications.

"Hesai has never developed, supplied, or certified products for military use, as its products are solely for civilian and commercial uses," the company stated in its press release.

The Shanghai-based company develops lidar solutions for applications including passenger and commercial vehicles with advanced driver assistance systems, autonomous driving vehicles, and non-automotive uses such as delivery robots.

While pursuing legal remedies, Hesai said it remains focused on delivering lidar solutions to its global customers across more than 40 countries through its offices in Shanghai, Palo Alto, and Stuttgart. Financial data from InvestingPro shows the company maintains a strong balance sheet with a current ratio of 4.06 and has achieved 24.2% revenue growth in the last twelve months. Currently trading near its 52-week high, detailed analysis and 15+ additional ProTips are available through InvestingPro’s comprehensive research reports.

The company, which is listed on Nasdaq, stated it will "vigorously pursue all legal avenues to protect its reputation and seek fair treatment." Investors seeking deeper insights into Hesai’s financial health, valuation metrics, and growth prospects can access detailed analysis through InvestingPro’s exclusive research reports, which provide comprehensive coverage of over 1,400 US-listed companies.

In other recent news, Hesai Group has reported notable developments that are capturing investor attention. Goldman Sachs has raised its price target for Hesai to $23.30, maintaining a Buy rating, following the company’s strong first-quarter 2025 results, where revenue met expectations and net profit exceeded them due to improved gross margins and reduced operating expenses. Similarly, Morgan Stanley increased its price target for Hesai to $23 while keeping an Equal-weight rating, citing the growing adoption of LiDAR technology in advanced driver-assistance systems. Jefferies also initiated coverage on Hesai with a Buy rating, highlighting its leadership in the LiDAR market and projecting significant revenue growth.

Additionally, Hesai’s AT series LiDAR technology has been chosen for Cadillac’s new electric VISTIQ SUV, marking the first in-cabin LiDAR deployment in the automotive industry. This partnership with Cadillac is expected to enhance vehicle safety and design. Furthermore, Hesai has been named the primary LiDAR supplier for Pony.ai’s new Robotaxi fleet, which will feature Hesai’s AT128 LiDAR sensors. This collaboration underscores Hesai’s pivotal role in advancing autonomous driving technologies.

These recent developments indicate Hesai’s strategic positioning in the LiDAR market and its collaborations with major automotive players, which could potentially drive further growth and innovation in the industry.

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