Lidar Sector Roundup: Ouster’s Physical AI Bet

Investors can’t get enough of the companies creating the “brains” of artificial intelligence (AI), with memory chip stocks like SanDisk [SNDK] and Micron [MU] seeing historic rallies in 2026. 

But what about the companies manufacturing the eyes of AI?

Lidar, or light detection and ranging, is a type of sensor that projects high frequency lasers and measures the time it takes for photons to return in order to create 3D maps of anything from highways to ancient ruins and marine topography. Widely used in transportation safety, cartography and even archaeology, lidar became an essential technology for the automotive sector with the rise of autonomous driving technology. 

Now, with scores of companies pivoting towards robotics as a future revenue stream, the same sensors are being fitted to everything from drones to humanoid robots, allowing them to “see” the world around them. 

Here, we examine the most recent developments for three leaders of the lidar sector – Ouster [OUST], Hesai [HSAI] and Aeva [AEVA] – their financials, and the headwinds and tailwinds facing each. 

Ouster presents: A unified platform

San Francisco-based Ouster is explicitly positioning itself as more than just a lidar manufacturer. The February 2026 acquisition of StereoLabs added AI vision software and cameras to its portfolio, allowing the company to offer what it has termed “physical AI’s first unified sensing and perception platform”. This expanded platform conceivably allows Ouster to provide machine vision solutions to clients in a range of markets, including drones and robotics, in addition to existing automotive, industrial and smart infrastructure verticals. 

A mid-June agreement with AIM Intelligent Machines hinted at the scope of potential applications for this platform. Expanding on a pre-existing collaboration, the agreement will see Ouster supply AIM with digital lidar sensors to convert conventional heavy machinery used in mining, construction and defence operations into AI-powered autonomous fleets. The impending IPO of Agility Robots, a manufacturer of bipedal warehouse robots and an important Ouster client, has further underlined the importance of lidar products in physical AI deployment. 

The full impact of this repositioning has yet to be seen, however, with robotics and other physical AI applications still relatively early in their development. In its Q2 2026 earnings, announced on 6 August, Ouster recorded $55m in revenue, up 56% year-on-year, with 17,000 sensors shipped – both record numbers. Approximately 53% of the sensors were lidar, and industrial and smart infrastructure verticals remained the two largest contributors to revenue. During the quarter the firm launched its Rev8 product, the world’s first native colour lidar sensor, which has been integrated into a number of applications, including partner Nvidia’s [NVDA] DRIVE and Jetson platforms. StereoLabs’ wrist-mounted stereo vision camera ZED X Nano was another prominent launch in the quarter, intended for robotics, data collection and machine learning applications. 

At present, the company remains unprofitable, making a GAAP net loss of $18m in Q2, a $2m improvement on the year-ago figure.

Management guided revenue of $54.5m-57.5m for Q3, an increase from previous guidance as Rev8 production ramps up. 

OUST shares saw strong performance over the first half of the year, reaching a four-year high of $63.79 on 30 June in the wake of its agreement with AIM Intelligent Machines. As of the 15 September close, OUST was trading at $32.79, up 51.52% in the year to date and up 13.26% in the past 12 months. 

Hesai’s trouble by association

Shanghai-based Hesai Technology commands approximately one-third of the global lidar market, serves customers in over 40 countries and is the first company in the sector to achieve full-year profitability. It provides lidar solutions to a range of clients in the robotics and autonomous vehicle space, and was selected as a lidar provider for Nvidia’s autonomous vehicle platforms in January 2026, alongside Aeva.

That said, its China ties have been frequently flagged as a risk for investors. Hesai was blacklisted as a national security threat in 2024 by the US Department of Defense and, while a recent legal victory could force the DoD to reconsider the designation, concerns remain. In late August, TechCrunch reported that the federally funded Idaho National Laboratory was investigating how Hesai’s lidar sensors could potentially be used to transmit sensitive information or even disable autonomous vehicles. 

Management has previously dismissed similar claims, arguing that data collected by Hesai sensors are accessible to the companies operating the vehicles, not to Hesai itself, and the sensors remain an integral part of a range of technology manufactured and deployed in the US. 

Q2 2026 earnings missed analyst estimates, with non-GAAP EPS of $0.01 coming in below targets by $0.06. However, revenue rose 21.9% y/y to $126.9m and total shipments rose 78.4% to nearly 630,000, buoyed by a 193.4% increase in robotics lidar shipments. Management emphasised Hesai’s core position in the physical AI supply chain, with its sensors used in a number of Chinese companies developing humanoid and industrial robots. The company is targeting revenue of RMB1.1bn-1.15bn in Q3, and lidar shipments of up to 3.5m in 2026.

Strong commercial performance has done little to boost the company’s shares. A margin decline in Q1 and concerns over the company’s exposure to China have seen HSAI fall out of favour with investors, even as names like OUST ride the current AI boom cycle. HSAI stock closed at $16.49 on 15 September, down 26.38% in the year to date and down 44.66% in the past 12 months.

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Aeva bets on a photonics pivot

As Ouster and Hesai focus their efforts on sensors for physical AI, their Mountain View, California-based peer Aeva is targeting another more immediately profitable AI-adjacent business.

In its Q2 2026 earnings call on 6 August, the company launched its Optical Connectivity business, announcing the signing of a joint development agreement for cutting-edge photonics products with an unnamed major hyperscaler. Production is expected to begin in H2 2027. CEO Soroush Dardashti underlined the scale of the agreement, saying it “has the potential to exceed multiple millions of units annually with revenues in the multiple hundreds of millions of dollars per year”.

In the near term, however, Aeva remains reliant on its 4D lidar and perception solutions for automotive and industrial applications. Revenue for the quarter came in at $6.1m, up 11.34% y/y with a non-GAAP loss per share of $0.41 beating analyst estimates by $0.02. Non-GAAP operating loss widened from $25.1m in the year-ago quarter to $26m, but liquidity reached $302.9m by the end of the quarter, supported by a $115m follow-on equity offering in June.

Like OUST, AEVA stock has benefitted somewhat from the current AI investment boom, though it has seen significant volatility, rallying sharply in the wake of earnings before dropping back down to prior levels. As of the 15 September close AEVA shares were trading at $14.19, up 6.85% year-to-date but down 12.30% in the past 12 months. 

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Lidar leaders: OUST vs HSAI vs AEVA

This is how the three stocks currently compare.

Source: Yahoo Finance

OUST has seen the strongest performance of the three in the year to date, although it has lower growth estimates and remains unprofitable. Oppenheimer initiated a ‘buy’ rating for Ouster in mid-July, and as of 15 September, the average price target for OUST stock on Yahoo Finance was $59.40, representing an upside of 81.15%, with five ‘buy’ ratings and one ‘hold’. 

Hesai’s strong financials and dominant market position both support a positive outlook for its stock, though the company’s exposure to China amid continuing geopolitical tensions could prove a key headwind. Of the 20 analysts surveyed by Yahoo Finance in September, five rated HSAI stock a ‘strong buy’ and 15 rated it a ‘buy’, with an average price target of $28.40. 

Aeva is betting on a relatively significant pivot, though management underplayed the investment required in the Q2 earnings call and underlined the potential revenue opportunity. Its lidar business is still loss-making, as its high P/S ratio suggests, and investors will be banking on future growth rather than current financial strength. Of the five analysts surveyed by Yahoo Finance in September, three rated AEVA stock a ‘buy’ and two a ‘hold’, with an average price target of $30.00.

Conclusion

Lidar applications have expanded from mapping to sectors as diverse as transportation, defence and industry. The demand for advanced sensors amid the deployment of physical AI, both via robots and autonomous vehicles, presents a key opportunity for lidar companies moving forward, although that deployment is still in an early stage. Both Ouster and Hesai are positioning themselves as the platform of choice for physical AI, with the US focus of the former and the dominant market position of the latter forming the basis for their respective bull cases. Aeva, meanwhile, remains much smaller in terms of scale but could capture significant growth from the data centre boom if its photonics pivot pays off. 

All three companies are expected to report Q3 earnings in the first two weeks of November, which should give investors a clearer view of the state of the lidar sector.