MINISO's "Increased Revenue, No Profit Growth," Yonghui Investment Becomes a Burden

Ask AI · What are the long-term effects of Yonghui’s investment losses on the company’s financial structure?

On March 13, 2026, the listed company Miniso Youpin (09896.HK, MNSO.N) released its 2025 annual financial performance, and this earnings preview has drawn widespread market attention.

Despite the company’s revenue scale still maintaining a growth trend, sustained pressure on the profit side, combined with a cool response from the capital markets, has once again put this retail giant founded on “quality and low prices” at the crossroads of industry transformation.

Profits are slashed behind flashy revenue

According to publicly available data, the company is expected to record full-year 2025 revenue of approximately RMB 21.440 billion to 21.445 billion, up about 26%. In contrast to the impressive performance on the revenue side, the company expects net profit for the year to be only RMB 1.320 billion to 1.330 billion, down sharply by about 50% from RMB 2.635 billion in the same period of 2024, marking the first year-on-year annual profit decline since its Hong Kong listing in 2022.

It is worth noting that if non-operating factors such as Yonghui Superstores’ investment losses, share-based payment expenses, and changes in the carrying value of redeemed liabilities are excluded, the company’s adjusted net profit is expected to be RMB 2.89 billion to RMB 2.9 billion, up about 10% year on year. While this figure preserves positive growth, the growth rate has clearly slowed significantly and is far below the revenue growth rate.

This trend in 2025 has further intensified. In the first three quarters of 2025, revenue was RMB 15.190 billion, up 23.7%, but net profit was only RMB 1.347 billion, down sharply by 25.7% year on year. Among them, in the third quarter, although single-quarter revenue reached RMB 5.8 billion, up 28.2%, net profit fell 31.6% year on year to RMB 443 million, setting the highest record in recent years for the year-on-year decline rate of quarterly profit.

Key indicators expose operational problems

Same-store growth is one of the core indicators used to measure a retail company’s per-store profitability and user stickiness, and it is also one of the operating data the industry cares about most. Miniso Youpin’s 2024 financial report shows that in 2024, the same-store GMV growth rate for domestic stores had already fallen to high single digits, meaning the growth potential of traditional small stores has basically hit its ceiling, and the customer footfall dividend is gradually fading. This situation worsened further in the first half of 2025. As of the first half of 2025, the same-store GMV growth rate for Miniso Youpin’s domestic stores fell to low single digits, making it difficult to support high-quality growth in overall performance.

（Image source: Miniso Youpin’s 2025 interim performance report）

In addition, in recent years, Miniso Youpin’s gross margin has basically remained stable at around 40% to 45%. The gross margin in the first three quarters of 2025 was 44.4%, keeping it steady overall, thanks to its scaled supply-chain advantages and cost-control capabilities. However, the sharp increase in selling and distribution expenses has become the main factor eroding profits. In the third quarter of 2025, the company’s single-quarter selling and distribution expenses reached RMB 1.430 billion, up 43.5% year on year—far exceeding the 28.2% revenue growth rate—mainly used for overseas market expansion, IP collaboration, and brand promotion spending.

According to publicly available data, as of the end of September 2025, Miniso Youpin had 8,138 stores worldwide in total, spread across 112 countries and regions, but the vast majority of them are traditional small stores, with relatively low store efficiency. To break through the growth bottleneck, the company has recently announced that over the next five years it will close 80% of its existing stores worldwide and redeploy, with the area of all newly opened stores not less than 400 square meters. It will focus on building “Lego/landscape”-style superstores centered on IP products, namely “MINISO LAND.” Currently, MINISO LAND has more than 25 stores globally already. For example, the flagship store at Shanghai Nanjing East Road’s Global No. 1 set a record of exceeding RMB 100 million in sales within 9 months, with IP products contributing 79.6% of the share. But the cost pressure brought by store closures and investment in new stores further increases the burden on the profit side, and it is difficult to generate positive profit contribution in the short term.

Apart from that, Miniso Youpin has a high level of dependence on IP, and its own IP competitiveness is relatively weak. The company’s core weakness in IP operations lies in “heavy on collaboration, light on incubation.” In 2024, its IP licensing fees were as high as RMB 421 million, up 29.2%. Although Miniso Youpin has signed with 16 collectible toy/puzzle art IPs artists and is gradually building its own IP matrix, the current contribution is limited—its core owned IP “YOYO Right Right Cat” is expected to generate sales of only RMB 40 million in 2025. Meanwhile, the high level of IP licensing costs further compresses profit space.

Yonghui’s investment: from strategic synergy to a financial burden

What is notable is that as Miniso Youpin’s profits shrank significantly in 2025, the biggest “culprit” may be the investment losses from Yonghui Superstores. In September 2024, Miniso Youpin acquired 29.4% of Yonghui Superstores’ shares via Guangdong Juncai International Trading Co., Ltd. for RMB 6.27 billion, becoming its largest shareholder. At that time, founder Ye Guofu went from on-site inspections to announcing the entry in only about three months—so quickly that it far exceeded market expectations. Ye Guofu was optimistic about Yonghui’s prospects for “Fat Donglai”-style reform and believed that both sides had synergistic advantages in channel upgrading and supply-chain integration.

However, this strategic investment—once expected to be highly promising—turned into a heavy financial burden in the short term. Yonghui Superstores posted a loss of RMB 1.465 billion in 2024, and losses are expected to further expand to RMB 2.14 billion in 2025. Based on the 29.4% shareholding ratio, the losses Miniso Youpin should recognize from its investment in Yonghui in 2025 would be approximately RMB 740 million, becoming the single largest factor dragging down the company’s net profit.

The more far-reaching impact is reflected at the level of the financial structure. Wind data shows that the company’s asset-liability ratio rose sharply from 42.85% at the end of 2024 to 62.23% at the end of September 2025. In addition, total short-term borrowings and long-term borrowings surged from RMB 571 million at the end of 2024 to RMB 7.508 billion at the end of September 2025, significantly increasing financial leverage.

From the perspective of market reaction, on the day the transaction was announced, Miniso Youpin’s U.S.-listed share price fell 16.65% at closing. The next day, its Hong Kong-listed shares at one point fell nearly 40%. Although Yonghui Superstores’ share price rose sharply at times due to expectations for “Fat Donglai reform,” Miniso Youpin’s share price has remained under long-term pressure. As of March 24, 2026, Miniso Youpin’s Hong Kong share price was HKD 31.8 per share, down about 38% from the 52-week high of HKD 51.35 per share.

It should be noted that Miniso Youpin accounts for its investment in Yonghui using the equity method and does not consolidate Yonghui’s financial statements. This means that Yonghui’s performance fluctuations will not directly affect Miniso Youpin’s revenue line, but investment gains and losses will directly impact the income statement.

Overseas expansion roars ahead, and the collectible toy brand grows at high speed

In recent years, Miniso Youpin has continued to expand its overseas markets. In the third quarter of 2025, the proportion of overseas revenue had risen to 44.3%, close to half of the total. The compound growth rate in the U.S. market from 2021 to 2024 reached triple digits. In 2024, it added 154 stores, bringing the total number of stores to 275, and it is expected to exceed 500 stores in 2025. Europe has also been defined by Ye Guofu as a “key incremental market,” with plans to open 1,000 stores over the next five years.

But overseas direct-operated expansion is a double-edged sword. While the direct-operated model can better control brand image and operating quality, it requires heavy upfront investment and a long payback cycle. In the third quarter of 2025, Miniso Youpin’s selling and distribution expenses rose 43.5% year on year, mainly driven by the expansion of overseas direct-operated stores.

Moreover, geopolitical risks cannot be ignored. In response to possible tariffs that the U.S. may impose, Miniso Youpin is accelerating the global layout of its supply chain. As of the first quarter of 2025, the proportion of products directly procured from the U.S. had already approached 40%, but such supply-chain adjustments themselves also mean additional costs and complexity.

As the collectible toy brand TOP TOY under Miniso Youpin, it achieved revenue of RMB 570 million in the third quarter of 2025, up 111% year on year, and is expected to grow by 70% to 80% for the full year. However, TOP TOY’s contribution share to the group’s overall performance still remains limited—full-year revenue in 2024 was only RMB 984 million, accounting for 5.8% of the group’s total revenue.

More importantly, TOP TOY’s rapid growth largely depends on channel support from Miniso Youpin. From 2022 to 2024 and in the first half of 2025, Miniso Youpin Group contributed 36.8%, 53.5%, 48.3%, and 45.5% of TOP TOY’s revenue, respectively. TOP TOY’s “light-footed progress” is made at the cost of Miniso Youpin’s “heavy burden.”

For Miniso Youpin, 2026 is a key year for making breakthroughs in its transformation. Whether performance can move from “flat” to “recovery” hinges on realizing the shift from “scale expansion” to “quality growth.” The superstore model is a core direction for the future, but it needs to optimize the cadence of store closures and new store openings to avoid the cost pressure caused by blind expansion.

Judging from the development trends in the retail industry, “efficiency-driven, trust-driven, and scenario-driven” has become the core logic. Miniso Youpin’s “themed-park-style” transformation direction aligns with industry trends, but the transformation journey is inevitably long and full of uncertainties.

For investors, in the short term they need to focus on the company’s store-closure progress, cost control, and profit improvement before making cautious allocations. In the long run, if it can break through the three major bottlenecks—its own IP, product quality control, and the integration of online and offline—then the company is expected to achieve a recovery in performance and regain the recognition of the capital markets. (Produced by “Wealth Management Weekly—Caishi Hui”)