Two Shenzhen giants defend their lifelines.

The boss of Insta360, Liu Jingkang, has been pushed to the limit.

On the evening of December 8th, Liu Jingkang issued an all - staff letter, stating that the company's drone product, "InstaDrone A1", had encountered "unconventional and intensive attacks". He presented data: The "InstaDrone A1" sold over 30 million yuan in the Chinese market within 48 hours of its launch, which contradicts the online claim that "the sales volume was only a few hundred units, far from the expected figure".

In the drone market, DJI cannot be avoided. Its drone products have long occupied over 70% of the global consumer - grade drone market share.

The "InstaDrone A1" was officially announced in July, indicating that Insta360, a giant in the intelligent imaging field, has entered the drone market. Just a few days later, DJI launched its first panoramic camera, the Osmo 360, as a counter - move against Insta360.

Liu Jingkang, the founder of Insta360, was born in Guangdong in 1991 and graduated from the School of Software at Nanjing University. During his university years, he once cracked Zhou Hongyi's phone number and refused job offers from industry tycoons such as Zhou Hongyi and Li Kaifu, with a strong desire to start his own business. In 2013, he assembled a team and launched a live - streaming app for prestigious universities. Later, after being exposed to overseas 360 - degree panoramic videos, the team decided to shift to the panoramic imaging field and began researching and developing panoramic cameras.

In 2015, Liu Jingkang moved the team to Shenzhen and founded Insta360. The market share of Insta360's panoramic camera products once reached as high as 85% - 92% globally.

In 2025, Insta360 was listed on the STAR Market, with 86% of its revenue coming from the panoramic camera business.

On the surface, the conflict between Insta360 and DJI seems to be a collision between a drone giant aiming to "take great photos" and a challenger trying to "create a flyable panoramic camera". In fact, for both sides, it is a battle to defend their "core interests".

- 01 -

Insta360's cross - border expansion is no longer a secret.

In 2022, Insta360 launched the panoramic camera "Tong Sphere" specifically designed for drones, which explicitly supports being mounted on DJI's Mavic Air 2/2S drones, solving the pain point of "single - perspective shooting" of traditional drones.

In fact, Insta360's entry into the drone market may have started even earlier. Recently, Liu Jingkang mentioned in multiple public occasions that Insta360's drone R & D started five years ago.

Calculated based on the official release of the InstaDrone A1 in December 2025, the R & D should have started around 2020.

Liu Jingkang's logic is that Insta360 develops drones based on the concept that "customers buy cameras to obtain high - quality images, not to operate the devices". At the same time, he has also publicly expressed his respect for DJI on many occasions. At the launch event of the InstaDrone A1, although he did not directly name DJI, he paid tribute to the industry leader in the consumer - grade drone category, acknowledging that it laid the industry foundation for the birth of panoramic drones.

Obviously, DJI does not buy this product differentiation positioning theory.

Zhou Guangtai (a pseudonym), the person in charge of Insta360's supply chain, told the Economic Observer that in the past five years, some structural component manufacturers have been verbally requested by DJI not to cooperate with competitors. However, this restriction has not been strictly enforced.

But in the third quarter of 2024, this supply - chain blockade suddenly escalated. DJI clearly stated: "You can cooperate with other customers, but Insta360 must be excluded." DJI also investigates whether suppliers violate the rule by cooperating with Insta360.

Zhou Guangtai felt complicated as he watched the number of suppliers decreasing one by one.

The reasons for suppliers to "withdraw from the cooperation" are diverse, both euphemistic and direct:

An optical lens manufacturer's lens module for Insta360 had entered the DVT (Design Verification) stage. Insta360 fully paid the mold cost, and samples had been obtained. During this period, under pressure from DJI, the manufacturer suddenly terminated the cooperation on the grounds of "insufficient personnel and bandwidth". Insta360 didn't get the mold cost back until two years later.

A subsidiary of a lens module manufacturer had completed the technical evaluation of Insta360's project but received a notice from the group that "an exclusive agreement with DJI has been signed" and was forced to stop the cooperation with Insta360.

A chip manufacturer designed a chip for Insta360 and entered the trial - production stage but was required not to deliver the goods. Insta360 was forced to initiate an alternative plan...

A list provided by Insta360 to the Economic Observer shows that optical lens modules, coaxial cables, rotating shafts, chips, plastic parts, assembly plants, radio frequency components, propellers, sensors, etc. are all included in the exclusive agreements. Among them, optical lens modules are the "hardest - hit area" of exclusivity.

- 02 -

The supplier camp has also shown signs of division.

According to the Economic Observer, suppliers who accept the exclusive agreements regard DJI as their core revenue source and are highly dependent on it. For them, losing DJI's orders may lead to a significant decline in revenue and even affect the normal operation of the enterprise. For example, an upstream supplier with an annual revenue of over 10 billion yuan has more than one - fifth of its revenue from DJI. If the cooperation ends, its revenue may drop by over 500 million yuan in the following year. A lens module supplier said bluntly that DJI is one of its top five major customers, and losing the cooperation may cause its revenue to decline by over 10%.

Some suppliers continue to supply goods to Insta360, such as Hongjing Optoelectronics and Zijian Electronics. As a core supplier of Insta360, Hongjing Optoelectronics has been cooperating with it since 2015 and signed a strategic agreement in 2022. In 2024, it provided exclusive supply of camera modules for Insta360's X3/X4 and other products, with a procurement share of 74%. In the first half of that year, the revenue from Insta360 accounted for 46.94% of its total revenue, and it was also deeply involved in the small - batch trial production of Insta360's new - generation action camera modules in 2025. Zijian Electronics supplies battery packs for Insta360's Insta360 Flow 2 Pro gimbal.

Some are neutral and observing. For example, Lianchuang Electronics once supplied lenses to both DJI and Insta360. In 2025, it said that the business cooperation with Insta360 had significantly decreased. However, with the advancement of Insta360's GO Ultra and InstaDrone projects in 2025, the lens procurement volume increased by 50% year - on - year. A supplier said that the components it produces can be adapted to all Insta360 camera products. This year, it has received an order for 500,000 components from Insta360, and it is expected that the order volume will double to 1 million next year, on a similar scale to DJI's orders. Since DJI's orders are scattered and the price is relatively low, such suppliers are not in a hurry to take sides.

Some suppliers do not give a clear response to the exclusive restrictions. These suppliers are mostly international leading manufacturers such as Ambarella and Sony, with a wide range of customers. DJI is just one of their many customers, and they do not need to rely on a single customer to survive. Moreover, exclusive cooperation would limit their market space, which does not conform to their global business strategy. Insta360's prospectus also shows that its core chips have long relied on international leading manufacturers such as Ambarella and Sony. Insta360 has also jointly developed customized aspherical lenses with Yutong Optics (indirectly supplied to Insta360's production line through Asia Optical).

In addition, there are reports that Insta360, which holds 100% of the shares of Yilugaofei, has invested in Yingwei Innovation, an AI chip R & D company, to reduce its technological dependence.

However, it is unrealistic to completely get rid of DJI's influence in the supply chain. According to a statement by an industry insider quoted by Zimubang, "No matter it's Autel or Insta360, no one can get a better price from suppliers than DJI."

The strong reactions from both sides are related to the changing market environment. A report predicts that the growth rate of the Chinese consumer - grade drone market dropped sharply to 8% in 2025 - the industry leader, DJI, is approaching the ceiling. After Insta360's listing, the growth rate of its revenue and profit has been slowing down. For example, in the first half of 2025, Insta360's revenue increased by 51.17% year - on - year (78.2% in 2023 and 53.3% in 2024), and its net profit increased slightly by 0.25% year - on - year (103.7% in 2023 and 19.9% in 2024). Both companies need to find new growth points.

Actually, as representatives of hard - tech companies in the Shenzhen consumer market, the two companies have their own advantages. DJI excels in hardware, while Insta360 is strong in software and algorithms. Great companies are made by great rivals. DJI has encountered a challenger in Insta360, and Insta360 is facing DJI on its way to the top. In the long history of China's consumer hardware innovation, this will become a classic business battle that will be repeatedly mentioned in the future.

This article does not constitute any investment advice.

This article is from the WeChat official account "Pencil News" (ID: pencilnews), written by Yan Mengchen, and published by 36Kr with permission.