Atour's retail revenue growth slowed by nearly half in 2025; can the high-margin segments continue to advance rapidly?

Ask AI · What challenges does Atour face when transforming into a lifestyle brand?

Even if you’ve never stayed in an Atour hotel, you might have bought an Atour pillow.

The financial report recently released by China’s leading hotel chain Atour Group shows that in 2025, retail revenue rose to 3.67 billion yuan, accounting for 37.5% of total revenue. However, compared with the 126.2% year-over-year growth rate in 2024, it slowed by nearly half to 67%.

In 2021, Atour Group launched its retail brand “Atour Planet.” The following year, it began selling the Deep Sleep Pillow Pro 1.0, which became the top-selling pillow category across all platforms within 9 months of its launch. With the Deep Sleep Pillow as its core product, Atour’s retail business GMV reached 2.592 billion yuan in 2024, and its revenue share increased to 30.3%.

In 2025, Atour hotels’ occupancy rate edged down from 77.4% to 75.9%. Meanwhile, 60% of retail revenue depends on converting hotel guests. A decline in guest traffic directly affects retail revenue performance.

To maintain the scale of retail revenue, in 2025 Atour stepped up marketing investments in the retail business, including e-commerce advertising and influencer-driven sales. The financial report shows that in 2025, Atour’s selling expenses ratio reached 15.9%, up 2.5 percentage points from 13.4% in 2024. In the same period, it was significantly higher than peers such as Huazhu (about 4.9%) and Jinjiang Inn (about 7.3%). The sharp increase in marketing expenses further compressed the company’s profit margins.

In 2025, Atour Group’s net profit margin fell from 17.6% to 16.6%.

According to annual report data, from 2023 to 2025, the gross profit margins of Atour’s hotel business were 34.5%, 35.9%, and 37.0%, respectively, showing a steady upward trend. In 2024 and 2025, the gross profit margins of the retail business were 50.7% and 52.6%, respectively—continuously about 15 percentage points higher than the hotel business—making retail an important profit-contribution segment for Atour Group.

Atour’s founder and CEO Wang Haijun has repeatedly emphasized the strategic significance of the retail business. He said that the retail segment continued to achieve strong growth in 2025. Through ongoing product innovation, Atour Planet further consolidated Atour’s leading position in the “sleep market.”

Seeing the success of the Deep Sleep Pillow and the competitive landscape that followed, Atour Planet also launched temperature-controlled quilts and mattresses, and expanded into sleep-adjacent products such as eye masks and pajamas. However, none of these products reached the same level of market buzz as the Deep Sleep Pillow.

Stepping out of the sleep category, Atour also launched a personal care and fragrance brand called “Sahe,” as well as a travel brand “Z2GO&CO.” that mainly sells travel suitcases and portable hair dryers, attempting to build a diversified retail matrix. However, as of the end of 2025, these two sub-brands were not separately reflected with performance in the annual report. In the short term, they cannot fill the growth gap in the retail business. Whether they can achieve large-scale growth in the long run remains to be seen.

In Chen Jingjing’s view—founder of Jingjie Brand Consulting and a strategic branding expert—Atour is currently in the uphill phase of transitioning from a “hotel brand” to a “lifestyle brand.” As the market dividend of the Deep Sleep Pillow gradually fades, and fluctuations in occupancy rate affect the guest conversion funnel, retail growth is shifting to online-driven channels. This not only increases marketing expenses, but also creates new challenges for how interests are allocated between stores and franchisees. Moving from a hotel brand to a lifestyle brand, Atour faces multiple rounds of reconstruction across its product system, brand mindshare, and channel structure—an even longer cycle and a more difficult second climb.

Chen Jingjing said that for Atour, “lifestyle brand” is not the only path forward. Compared with horizontally expanding into more categories, a more realistic approach is to return to the core business, strengthen the fundamental base of the hotel business, focus on advantageous scenarios such as sleep and business travel, build a stable product system and clear brand recognition, and improve conversion efficiency through curated retail. For product exploration that goes beyond expansion boundaries, the pace should be controlled and losses should be cut in time; otherwise, the complexity of the business may outstrip the organization’s and channels’ capacity to carry it.