The collaboration, which centers on providing the German automaker with AI foundation models, brain processing units, and specialized engineering services, remains a cornerstone of the Chinese tech firm's growth strategy. However, the anticipated infusion of capital is being weighed against a stark reality: softer demand for new vehicles across China and an increasingly aggressive competitive landscape.

Analysts at Daiwa have adjusted their outlook, lowering the company’s 2026 to 2028 revenue forecasts by 6% to 18%. The most significant hit appears in the 2028 profit projection, which has been slashed by 60%. This downward revision stems from the front-loading of essential engineering and validation expenses required to deliver on the Volkswagen contract. Consequently, the firm has lowered its target price for Horizon Robotics shares from HK$10.60 to HK$6.30, though it maintains a buy rating on the stock, which last traded at HK$4.44.