"Don't try to beat us on cost reduction—we can still cut a lot more."

Hardware and motion control algorithms are the most frequently cited advantages of Unitree. According to the prospectus, Unitree's quadruped robot gross margin rose from 43.71% in 2023 to 56.72% in 2025, while its bipedal humanoid robot gross margin has remained stable above 60%, reaching 63.18% in 2025. Multiple robot hardware engineers said that Unitree's hardware advantage isn't about superior quality or precision, but rather achieving extreme cost reduction through solution selection and structural design, while rapidly iterating hardware development through shipping volume and delivery speed.

The core component of a humanoid robot is the joint module, with the cost of a rotating joint module primarily composed of motors, reducers, encoders, and communication protocols. A CTO from an embodied intelligence company who has disassembled Unitree's products believes that Wang Xingxing has a "thorough" understanding of robot systems and stands far ahead of others in design solution selection. "From the start, he wouldn't choose solutions that are hard to reduce costs on, and he wouldn't blindly stack component performance." He cited an example: Unitree's robots don't use high-precision encoders but instead use the most common encoders equipped with Hall elements, with costs that can differ by a hundredfold.

The motor is the robot's core component, outputting force and controlling movement speed and action precision. The permanent magnet synchronous motors used in Unitree's robots are composed of silicon steel sheets, permanent magnets, and copper wire, with silicon steel sheets being the core material. The aforementioned person said silicon steel sheets cost four to five thousand yuan per ton, while the best materials currently cost ten to twenty thousand yuan per ton. Most domestic embodied intelligence companies typically purchase finished joint modules or single core components, but Unitree procures basic components like gears and structural parts, assembling them in its own factory.

Motor heating is key to robot lifespan and sustained operation capability. Multiple people close to Unitree said that Unitree's motor heat dissipation is achieved through structural design rather than using more expensive thermally conductive metals with better heat dissipation performance. Additionally, in terms of communication protocol selection, Unitree uses basic communication protocols with relatively lower costs. The aforementioned person mentioned, "It doesn't use the bus protocols commonly used in industry. Many of our customers would look down on the protocols they use and think, 'Can this really work?' But in fact, it does work." The more basic the protocol, the higher the development difficulty, requiring engineers to do more extra work to achieve equivalent results—and the same applies to hardware. Achieving the same effect with cheaper solutions "is a reflection of technical capability."

Multiple embodied intelligence practitioners summarized the common approaches to cost reduction in the robot body industry: on the production side, pushing down external procurement unit prices through larger shipment volumes. "Long-term, this is feasible. But the market is still in its early stages with limited real order volumes, and sufficiently large sales scale itself is a paradox," one practitioner said. Wang Xingxing has focused on cost reduction since the beginning of his entrepreneurial journey, believing that relying solely on mass production to reduce costs is a detour. He has publicly stated multiple times that cost reduction relies first on design—the most fundamental path—and second on mass production. In a 2025 interview, he said, "Many people think that once I have volume, I can reduce costs. That's pure illusion." He also added, "Don't try to beat us on cost reduction—we can still cut a lot more."

Wang Xingxing mentioned in an interview that in 2009, he spent 200 yuan building his first bipedal robot. At that time, he didn't even have power tools and bought a manual drill bit for a few yuan, which made his hands sore from use. Through this penny-pinching process, he learned to optimize workflows, making performance better while keeping production costs as low as possible.

The supply chain is also a reflection of Unitree's "value-for-money" logic. Employees have observed that Unitree's suppliers are mostly concentrated in the Jiangsu, Zhejiang, and Shanghai region, located nearby, mainly small and medium-sized factories, and they go through repeated screening. Unitree also negotiates relatively aggressively with suppliers. A Unitree insider said that when procuring, Unitree asks suppliers, "Do you still want to cooperate?" But quality control consequently comes under pressure. Roland said that Unitree's quality inspection personnel are mostly outsourced, mainly checking appearance, and material quality can vary between batches. "At this cost and speed, the supply chain won't give you particularly good quality control," he said, adding that R&D staff often need to repeatedly address material quality issues. A Unitree employee said that early product return rates were "extremely high," but now they can at least ensure products won't fail within the one-year or six-month warranty period. An investor who has invested in multiple embodied intelligence companies noted that many companies' robots require repairs within one to two months.

Multiple Unitree supply chain insiders said that in cooperation with the supply chain, Unitree is definitely the dominant party. They all mentioned that Unitree's product design iteration speed is very fast and details are scrutinized meticulously. One supplier described Unitree's delivery rhythm as "short, fast, and quick," for which they specially established a liaison team with a three-to-four-week rapid response workflow for design changes. Another supplier said that when they first started contacting Unitree, the company only placed an order for ten units. Ten units made production scheduling difficult even for a company of their modest size. She believes Unitree can only work with small companies that can adapt to its rapid iteration needs, as large supply chain companies can't even fit these orders into their schedules—"If you need delivery within three days, the internal processes at many large companies alone would take three days." The aforementioned person said that even if labor costs were calculated as zero, there's hardly any profit—"Unless a company's strategy is strongly bullish on robotics and firmly committed to entering this track." This is also their reason for wanting to become Unitree's supply chain partners. As Unitree's production scale gradually expands and small factories' production capacity can no longer meet its needs, Unitree is both seeking external companies that can handle its current production capacity and expanding its own production.

After 2025, embodied intelligence has become a clear part of many listed companies' strategic plans, especially companies originally in the automotive supply chain and consumer electronics supply chain, which treat embodied intelligence as their "second growth curve." Many supply chain companies mentioned that Unitree's supply chain is very closed—they don't know which companies are in it and can't get in. "Previously, some listed companies speculated on their stocks using Unitree's name, so Unitree terminated cooperation and became more cautious when seeking listed companies as supply chain partners," one Unitree supply chain insider said. Unitree signs confidentiality agreements with suppliers, and if they publicly promote themselves as Unitree supply chain members or use that to speculate on stocks, Unitree will terminate cooperation with a breach penalty of 5 million yuan. Unitree suppliers believe the 5 million yuan can be understood as a "one-size-fits-all" breach amount—"Whether it places an order of several million yuan or several thousand yuan with you, the breach penalty is still 5 million yuan."

Some suppliers appreciate Unitree's approach. One supplier noted that just as Wang Xingxing said during the IPO roadshow, "We hope investors buy Unitree's stock because they recognize Unitree," they too "just want to steadily complete orders and find more customers." Unitree has almost no "sole suppliers"—the same component is purchased from different suppliers. As for core components, both the prospectus and Unitree executive Chen Li's public statements indicate that all of Unitree's core components are self-developed. Late on January 4, 2026, Unitree's official video account released a video of Wang Xingxing (right) at the training site of the H2 humanoid robot. Photo/IC