Perspective on OK Lens Industry Leader's Financial Report: Why Are OK Lenses with a Gross Profit Margin of 89% No Longer Selling Well?

High-margin OK lenses, why are they no longer selling well?

On March 28, Opto-Kanshi Technology Co., Ltd. (300595.SZ, hereinafter referred to as “Opto-Kanshi”) released its 2025 performance report. During the reporting period, the company achieved operating revenue of 1.86B yuan, with net profit attributable to the parent of 479 million yuan, a year-on-year decrease of 16.20%. Compared to the 14.16% decline in net profit attributable to the parent in 2024, profit pressure in 2025 has further intensified.

Nandu N Video reporter noted that although the company’s core product, OK lenses, still maintain a high gross profit margin of about 89%, they have experienced negative revenue growth for two consecutive years.

Why are high-margin OK lenses no longer selling?

Opto-Kanshi is a high-tech enterprise specializing in eye health and myopia control technology and services. Its main business is divided into two segments: “Optical Products” and “Optical Services,” involving rigid contact lenses and their care products, other optical products beyond rigid lenses, and other eye health products.

During the reporting period, revenue from rigid contact lens products was 730 million yuan, down 2.90% year-on-year. This marks the second consecutive year of negative growth after the first decline in 2024.

However, what is particularly noteworthy is that although the company’s core product, rigid contact lenses, still maintain about an 89% high gross profit margin, the proportion of rigid contact lenses in total revenue has decreased year by year from 47.03% in 2023 to 42.01% in 2024 and 39.75% in 2025. This means that while OK lenses are still profitable, their sales volume is decreasing.

The company attributes this to reasons similar to last year, mainly including persistent weakness in high-end consumer demand, the diversion of potential customers by myopia control products like functional frame glasses, and intensified competition in corneal reshaping lenses.

In fact, this is not an isolated problem for Opto-Kanshi. The company openly stated in its annual report that “the rigid contact lens industry as a whole is currently in a development bottleneck. Since 2023, products like orthokeratology (corneal reshaping) glasses, with their non-medical device attributes, have rapidly captured market share due to relaxed regulations, extensive sales channels, and price advantages.”

Haohai Shengke also confirmed this trend in its 2025 annual report, with sales revenue of its corneal reshaping lenses decreasing by 11.73% compared to the previous year. “The report pointed out that the ophthalmic consumer market with non-rigid demand has been continuously weak since the second half of 2023, with consumer willingness falling short of expectations. Meanwhile, in recent years, many new products in the domestic corneal reshaping lens market have been approved, intensifying internal competition.”

Regarding the 16.20% year-on-year decline in net profit attributable to the parent in 2025, which is lower than revenue growth, Opto-Kanshi provided a clear explanation in its annual report. On one hand, revenue from high-margin rigid lenses declined, while revenue from other products with relatively lower margins increased, resulting in a profit growth rate lower than that of revenue. On the other hand, sales expenses increased by 12.86% year-on-year, management expenses rose by 17.91%, asset impairment losses grew by 34.11%, and non-recurring gains and losses decreased by 12.58%. Multiple factors combined to create a situation where the company’s “revenue increased but profit did not.”

Optical services become a new growth engine

While core business growth remains sluggish, Opto-Kanshi’s long-planned “optical services” are gradually taking over the growth baton.

In developed countries, community-based optical centers are the main providers of optical services, characterized by numerous small-scale outlets and large overall scale. In China, professional optical services are a sub-specialty within hospital ophthalmology departments, with few practitioners, inconvenient patient visits, and unmet social demand for optical services. Meanwhile, the many optical stores are retail outlets for routine vision correction products (such as frame glasses and contact lenses) and cannot provide professional optical solutions.

Opto-Kanshi was the first in China to propose a community-based professional optical service system and has begun practical exploration.

The annual report shows that the company has established over 500 community optical service terminals, mainly providing professional solutions and personalized services such as eye health checks, vision correction, myopia prevention and control management, visual function training, eye fatigue and dry eye therapy, aiming to let community residents enjoy convenient, professional optical services at their doorstep.

Opto-Kanshi states that it is not only an advocate of the community-based optical service system in China but also a leader in this field. Since launching the community optical service terminal business, the number of terminals and the overall scale of operations have continued to grow.

In 2024, the company’s revenue from optical terminal operations exceeded half of its total revenue for the first time. This proportion continued into 2025.

Myopia control market “blooming”

Behind the changing market landscape are dual drivers: national policies and consumer stratification.

Nandu N Video reporter noted that the National Health Commission’s “Guidelines for Myopia Prevention and Control” and “Technical Guidelines for Myopia Prevention and Control in Children and Adolescents” both list corneal reshaping lenses as an effective method for myopia control, reflecting policy recognition of their clinical value.

Meanwhile, the government is promoting lower costs for corneal reshaping lenses. Some public hospitals have implemented policies to reduce retail prices of these products. In 2023, Hebei Province led a centralized procurement alliance for corneal reshaping lenses, which was implemented in participating regions, with Opto-Kanshi among the winning companies. Although the impact on the company’s performance has been limited due to sales scale, the company openly stated, “but the subsequent impact on our performance is likely to be negative, with the extent of influence uncertain.”

Against the backdrop of policy-driven price reductions and increasing consumer stratification, the myopia control market is shifting from “a single flower” to “a hundred flowers blooming.”

Opto-Kanshi pointed out, “Before 2023, corneal reshaping lenses dominated the myopia control product market for a long time. Since 2023, frame glasses with features like reducing peripheral hyperopic defocus and other myopia control concepts, benefiting from relaxed regulation due to their non-medical device status, widespread fitting outlets, and lower prices, have rapidly increased in sales, diverting some potential users from corneal reshaping lenses and causing growth bottlenecks in their promotion.”

The company believes that besides corneal reshaping lenses, another major product in rigid contact lenses is scleral contact lenses. These are a rigid choice for patients with complex corneal shapes and an upgrade option for ordinary contact lens users seeking higher comfort. Scleral lenses have just entered the domestic market, and user numbers are expected to grow rapidly. “Overall, the rigid contact lens industry is currently in a development bottleneck but has long-term growth potential.”

In response, Opto-Kanshi is strengthening barriers through technological upgrades. The company plans to vigorously promote new products with competitive advantages, including the latest generation of corneal reshaping and scleral lenses made with materials that have the highest oxygen permeability (DK value 185). To address weak high-end consumer demand, it will launch affordable corneal reshaping lenses and continue to promote package discount plans. Additionally, it will enrich its myopia control product matrix by launching composite lenses that combine defocus reduction and contrast reduction to meet different market needs.

Reported by: Nandu N Video reporter Wu Yueming