1. What Happened? : Seegene AI’s Earnings Shock

Seegene AI’s H1 2025 revenue plummeted by 84.4% year-on-year, pushing the company into a severe crisis. The downturn is primarily attributed to the significant underperformance of its core AI facial recognition system business, which the growth in the AI facial authentication solution segment couldn’t offset. The company also reported operating and net losses, further weakening its financial standing.

2. Why Did This Happen? : Core Business Struggles and Financial Risks

  • Core Business Decline: Increased competition and declining demand in the AI facial recognition system market led to a sharp drop in revenue.
  • High SG&A Expenses: Excessive selling, general, and administrative expenses negatively impacted profitability.
  • Financial Risks: Convertible bond issuance and derivative liabilities introduced instability to the company’s financial structure.
  • Customer Concentration: High reliance on a few key clients poses a risk to business stability.

3. What’s Next? : An Uncertain Future, But Opportunities Remain

The short-term outlook appears bleak. Recovery hinges on revitalizing the AI facial recognition system segment and accelerating the growth of the AI facial authentication solution business. In the long run, successful development and monetization of the medical AI business will be crucial. However, new ventures are inherently uncertain and require time.

4. What Should Investors Do? : Proceed with Caution

Seegene AI is navigating challenging waters. Investors should exercise extreme caution and closely monitor the company’s strategic execution and ability to adapt to market changes. The short-term investment appeal is very low, and future investment decisions should be contingent on the company’s progress and performance.