This article first appeared on GuruFocus .
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Revenue:RMB 5.7 billion, a growth of 28.5%.
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Adjusted Net Profit:RMB 630 million, an increase of 8%.
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Operating Cash Flow:Grew by 40%.
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Free Cash Flow:Increased by 36%.
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Gross Margin:43.3%, down from 44.2% last year.
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Same-Store Sales Growth:High single-digit in Mainland China; mid-double-digit in North America.
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Store Count:8,210 stores worldwide, with a net increase of 722 stores.
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MINISO Brand Revenue:RMB 5.17 billion, up by 26.6%.
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Top Toy Revenue:RMB 510 million, a growth of 51.4%.
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Operating Expense Ratio:29.2%, compared to 28% last year.
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Cash Position:RMB 7.45 billion.
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Inventory Turnover:100 days, compared to 102 days last year.
Release Date: May 26, 2026
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
Positive Points
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MINISO Group Holding Ltd ( NYSE:MNSO ) reported a 28.5% increase in revenue, reaching RMB 5.7 billion, exceeding their high-end guidance.
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The company saw a significant growth in adjusted net profit, which increased by 8%, and operating cash flow grew by 40%.
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MINISO's store upgrade strategy is showing positive results, with a 25% increase in live store share and a high level of franchisee profitability.
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The company is experiencing strong international growth, with a 51% increase in top toy revenue and a 22% growth in overseas revenue.
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MINISO's proprietary IP strategy is gaining traction, with successful launches and increased market validation, contributing to higher margins.
Negative Points
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The gross profit margin declined by 0.9 percentage points to 43.3%, due to a smaller share of high-margin overseas business and increased mix of new domestic products.
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Operating expenses grew by 34%, with a notable increase in selling expenses driven by investments in store operations and promotional activities.
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The company reported a net foreign exchange loss of over 8 million RMB, impacting their margins by 1.5%.
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Inventory turnover for overseas operations increased, driven by inventory buildup ahead of store openings and logistics instabilities.
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The company faces challenges in the overseas market due to high crude oil prices and potential consumer sentiment weakening, which could pressure logistics costs and sales.
Q & A Highlights
Q: Could the management team share insights on the demand in key overseas markets, particularly regarding distributor orders, pricing, and logistics? What are the potential risks and strategies moving forward? A: Guofu Ye, CEO, explained that the company is focusing on high-margin categories and proprietary IP products to hedge against cost pressures. They have extended raw material stocking cycles to stabilize costs. In the US, differentiated pricing strategies have been implemented, leading to improved gross margins. The company remains proactive in customer management despite potential logistics cost pressures and consumer sentiment fluctuations.
Q: What are the sales trends and strategies for the Indonesia and Mexico markets? A: Guofu Ye, CEO, noted that Indonesia has shown solid profit contributions, with a focus on membership and repeat purchases driving growth. In Mexico, same-store sales have improved, and the strategy includes rolling out larger stores to enhance IP offerings and ticket sizes. The company expects positive sales growth in both markets, with significant potential in Mexico due to its consumption power and competitive landscape.
Q: How is MINISO performing in the mainland China market, and what strategies are in place? A: The company has renovated around 80 stores, resulting in a 50% increase in average daily sales. For 2026, they plan to renovate over 300 stores, focusing on larger formats and improving franchisee profitability. The share of profit from franchisee stores continues to rise, with larger stores achieving faster payback periods. Franchisees are increasingly interested in investing in large store formats.
Q: What trends are observed in consumer behavior in China, and how is membership impacting growth? A: The average daily order volume and ticket size are increasing, with membership being a key growth driver. Members contribute significantly to sales, with their share rising from 60% to over 70%. The company is focusing on member acquisition and repeat purchases to sustain growth. Positive trends are observed across all city tiers, with provincial capitals driven by large stores and top-level IP offerings.
Q: Can you elaborate on the proprietary IP strategy and its impact on profitability? A: Proprietary IP products have higher margins and offer exclusivity and differentiation. The company is building a business model around proprietary IP, which includes sub-licensing, content production, and enhancing IP capacity. This strategy aims to sustain long-term profitability and create a high-margin business model.
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
