MINISO (Minutes): Annual revenue growth rate not less than 25%, profit margin improving quarter by quarter

The following are the minutes of MINISO's Q2 2025 earnings call organized by Dolphin Research. For an interpretation of the financial report, please refer to the article MINISO: Large Stores to the Rescue, Is IP Retail Recovering?

I. Review of Key Financial Information:

(1) Business Performance

• Revenue Growth: Q2 total revenue was RMB 4.97 billion (YoY +23.1%), exceeding the upper limit of the guidance (original guidance +18%-21%); H1 total revenue was RMB 9.39 billion (YoY +21%).
• Same-Store Sales: Q2 same-store sales in China turned positive (improving for four consecutive quarters), while the decline in overseas same-store sales narrowed to low single digits; North America/Europe same-store sales achieved mid-single-digit growth.
• Brand Performance: MINISO revenue was RMB 4.56 billion (YoY +20%), with China revenue at RMB 2.62 billion (YoY +40%); TOP TOY revenue was RMB 400 million (YoY +87%), continuing high-speed growth.
• Store Expansion: Q2 saw a net increase of 124 stores globally (30 in China + 94 overseas); the annual plan is to net increase 100-150 stores in China (mainly large/flagship stores) and over 500 stores overseas (with the proportion of directly operated stores adjusted to 35%).

(2) Financial Data

• Profit Margin: Q2 gross margin was 44.3% (YoY +0.4pct), benefiting from an increased proportion of overseas revenue and the advancement of the IP strategy;
• Adjusted Profit: Q2 adjusted operating profit was RMB 850 million (YoY +8.5%), and adjusted net profit was RMB 690 million (net profit margin 30.9%);
• Cash Flow: H1 operating cash flow improved significantly, with ample cash reserves at the end of the period;
• Shareholder Returns: A mid-term dividend of RMB 640 million was declared (accounting for 50% of adjusted net profit), and H1 repurchase amount exceeded the total of last year (accounting for 1% of total share capital).

(3) Strategic Priorities

Store strategy: Large-format stores in China account for 5% of total stores, contributing double-digit sales; new stores in the U.S. are 1.5x more efficient than old stores, with sales per square meter 30% higher.

IP strategy: Launching a "dual-drive" model (international IP + self-owned IP), signing 9 self-owned IPs (e.g., “Lü Chan”), with the goal of self-owned IP sales surpassing RMB 100 million.

Supply chain optimization: Achieving 10%-20% cost reduction through modularization and design optimization, while improving efficiency.

(4) Performance Guidance

Q3 revenue expected to grow +25% to +28% YoY; full-year revenue growth not less than 25%.

Adjusted operating profit guidance of RMB 3.65–3.85 billion (vs. RMB 3.4 billion last year), with profit margin improving quarter by quarter.

II. Detailed Content of the Earnings Call

2.1. Management’s Key Messages

Same-store sales growth: In China, driven by product linkage mechanisms, popular SKU zones, and holiday promotions; overseas, replicating China’s experience with notable improvements in North America/Europe same-store sales.

Regional performance: Overseas GMV roughly one-third from Asia (ex-China), one-third from Latin America, and one-third from Europe & North America. In the U.S., growth was driven by localized teams, concentrated store openings, and toy category expansion; Latin America faced short-term pressure due to currency and inventory adjustments.

IP strategy: Self-owned IPs (e.g., “Lü Chan”) experienced supply-demand imbalance, with next year’s sales target to exceed RMB 100 million; strengthening IP experience through Miniso Land and deepening collaborations with artists.

Cost control: U.S. tariffs offset via early stocking, local sourcing, and tax planning, ensuring gross margin remained unaffected; expense growth in directly operated stores was lower than revenue growth, improving operating efficiency.

2.2. Analyst Q&A

Q: Could you elaborate on the U.S. business? It continued to perform strongly in Q2. What were the key growth drivers? Looking ahead to the second half, especially on profitability, what are your expectations?

A: U.S. growth was mainly driven by four pillars: (1) large-store model; (2) concentrated store openings, such as three stores opened at once in Texas; (3) strengthening toy category; and (4) building local teams. New stores are about 1.5x as efficient as old stores. Looking ahead to the second half, we will focus more on same-store sales improvement and holiday operations. On profitability, we will continue to improve through refined operations.

Q: Regarding same-store sales growth in China, is it driven more by traffic or basket size? Did O2O contribute? Also, could you break down overseas regional sales and growth strategies? Lastly, how is TOP TOY positioned overseas compared with MINISO?

A: In China, same-store growth was mainly driven by higher basket size. The decline in traffic narrowed, while conversion rates improved. O2O did not contribute to same-store growth. Overseas GMV distribution is roughly one-third Asia (ex-China), one-third Latin America, and one-third Europe & North America. TOP TOY focuses on trendy collectibles with higher price points, while MINISO covers a broader range including lifestyle and trendy products. We plan to add 50–60 net new TOP TOY stores overseas.

Q: Regarding self-owned IPs, what are your sales targets and operating model? Why shift from international IPs to self-owned IPs? Which overseas markets exceeded expectations and which fell short?

A: Taking “Lü Chan” as an example, our sales target this year is over RMB 100 million, and RMB 600 million next year. Our operating model includes Miniso Land and collaborations with artists to enhance the IP experience. Compared to international IPs, self-owned IPs have greater long-term value since international IPs lack ownership rights. Outperforming markets include the U.S., Canada, and Australia, mainly due to strong local teams; underperforming markets include Latin America (currency and inventory adjustments) and Hong Kong (high rents and traffic outflow).

Q: What is the impact of tariffs on the U.S. business? Also, how do same-store sales compare between higher-tier and lower-tier cities in China?

A: We offset tariffs through early stocking, local sourcing, and tax planning, so gross margin was not impacted. In China, higher-tier cities outperformed lower-tier cities in same-store sales, as our IP strategy resonates more with higher-tier consumers.

Q: Could you compare the growth of overseas direct operations vs. distribution? Also, what’s the pace of self-owned IP development?

A: Direct operations are growing faster than distribution, but the two models are complementary. The direct operation model also includes franchised stores, while the distribution model includes some directly operated stores. Self-owned IPs will develop in parallel with international IPs, and we will build a complete IP ecosystem through Miniso Land expansion in both China and overseas.

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