Unified Ice and Fire: Instant Noodles Hold the Line, Beverages Stall Completely

Banzhuo Consumption, Chen Xiaojing

In the first half of 2026, Uni-President Enterprises China delivered a pleasing operational performance, recently releasing a positive interim financial report.

Total revenue for the first half reached RMB 17.321 billion, with profit attributable to equity holders amounting to RMB 1.402 billion, representing year-on-year growth of 1.4% and 9.0%, respectively. The overall gross margin increased by 0.7 percentage points.

Beneath these impressive figures, a clear divergence is evident between the company's food and beverage segments. The food business has expanded its growth potential through differentiated single products, while the beverage segment, which serves as the core revenue driver, showed a slight decline, with all categories except milk tea performing weakly.

The situation of strong food sales and sluggish beverage performance is not a short-term phenomenon but an inevitable result of multiple factors, including slow long-term product iteration, missed development windows in certain categories, and relatively weak distribution channels.

Growth Against the Trend, Sector Divergence

On the evening of August 5, Uni-President Enterprises China (00220.HK) announced its 2026 interim results. In the first half of the year, the company's overall operations improved, recording total revenue of RMB 17.321 billion and profit attributable to equity holders of RMB 1.402 billion, up 1.4% and 9.0% year-on-year, respectively.

In the first half of 2026, structural differentiation in the consumer market was pronounced. Mass basic consumption pursued extreme cost-effectiveness and pragmatic experiences, accelerating the formation of a new value logic where affordable, high-quality products form the foundation, and emotional experience adds value.

Against this market backdrop, Uni-President's food business broadened its market reach by relying on high-quality, differentiated products, while adhering to value marketing principles to continuously enhance brand reputation and user stickiness.

In the first half, the company's food business achieved revenue of RMB 5.634 billion, a year-on-year increase of 4.7%. Instant noodles across the entire series performed notably well. The company focused on managing the "Tonkotsu Flavor" flagship product and launched the spring limited edition "Volcanic Spicy Tonkotsu Ramen," setting new highs in both buzz and revenue. Uni-President's Old Pickled Cabbage Beef Noodles maintained stable market share; Qie Huang and Manhan Feast both achieved double-digit growth; and Uni-President's Braised Beef Noodles, as a classic product, continues to win consumer favor.

During the period, the gross margin for the food business was 28.5%, an increase of 1.7 percentage points year-on-year.

The beverage business remains the company's largest source of revenue, generating RMB 10.751 billion in the first half, a slight year-on-year decrease of 0.3%. It accounted for 62.1% of total revenue, with a sector gross margin of 39.9%, up 0.5 percentage points from the previous year.

Benefiting from the continuous optimization of product structures in both sectors, the company's total gross profit increased from RMB 5.865 billion in the same period last year to RMB 6.066 billion in the first half of this year, a year-on-year growth of 3.4%. The comprehensive gross margin stood at 35.0%, an increase of 0.7 percentage points.

However, to boost terminal sales and expand channel coverage, the company further increased its investment in sales. In the first half of this year, sales and marketing expenses amounted to RMB 3.939 billion, an increase of RMB 166 million compared to the same period last year.

Food Strengthens, Beverages Lose Speed

For a long time, Uni-President has exhibited a structural divergence characterized by strong food business performance and sluggish beverage growth.

From 2023 to 2025, the company's food business revenue grew from RMB 9.847 billion to RMB 10.494 billion. Among this, the instant noodle business, contributing over 90% of the revenue, is returning to a growth trajectory. During the same period, the food business gross margin rose from 34.1% to 37.8%.

Looking at annual data, instant noodle business revenues were RMB 9.594 billion and RMB 9.849 billion in 2023 and 2024, respectively. In 2025, the company did not separately disclose instant noodle revenue. Combined with the 5% year-on-year growth in food business revenue that year, it is estimated that the full-year revenue scale for instant noodles approached RMB 10 billion.

However, the larger-scale beverage business under the company saw its growth momentum attenuate year by year.

From 2023 to 2025, although beverage business revenue scale grew from RMB 17.776 billion to RMB 19.471 billion, the growth rate slowed from 8.4% to 1.2%.

Uni-President's beverage business covers multiple tracks including tea drinks, juice, milk tea, coffee, and packaged water. In the first half of 2026, beverage business revenue weakened across almost all categories, with only milk tea achieving growth.

During the period, the milk tea business generated revenue of RMB 3.645 billion, a year-on-year increase of 7.3%, primarily driven by the flagship product Assam Milk Tea.

This product entered the mainland market in September 2009, achieved a sales scale of RMB 400 million in 2010, and grew to RMB 2.3 billion by 2013, becoming the leader and super-flagship product in the ready-to-drink milk tea track.

Assam Milk Tea, now 17 years old, is the only long-life-cycle flagship product in Uni-President's beverage business. However, no second flagship product of equal magnitude has been cultivated since. The company hopes that promoting low-sugar Jasmine Milk Green Tea will become a new growth driver.

Uni-President started early but finished late in the tea drink track. In 2004, the company introduced the sugar-free tea brand Cha Li Wang to the mainland, laying out bottled sugar-free tea even earlier than Nongfu Spring. But at that time, market consumer mindset was not yet mature, and product sales fell short of expectations. Cha Li Wang actively exited the mainland market in 2011. In the same year, Nongfu Spring's Oriental Leaf was launched, eventually becoming the absolute leader in this niche market.

For the next 8 years, Uni-President shelved its sugar-free tea strategy, only restarting Cha Li Wang in 2019, reconstructing channels, packaging, and formulas in the mainland market, but the industry dividend window became increasingly narrow.

In April 2024, as the sugar-free tea price war intensified, Uni-President launched Chunfu Green Tea priced at RMB 4, filling gaps in its full product matrix to catch up fully.

Repeatedly Missing Windfalls

The deepest impression Uni-President Enterprises China leaves on the outside world consists of only a few old products: Uni-President Ice Black Tea, Green Tea, Assam Milk Tea, and Old Pickled Cabbage Beef Noodles.

The company's beverage business is not lacking in strength, nor is it incapable; rather, beverage products iterate quickly, requiring constant incubation and cultivation of new products to attract users.

Uni-President's biggest problem lies in the aging of its flagship products and insufficient strategic focus, compounded by intensifying external market competition, leading to repeated misses of market opportunities.

The company's core beverage products have all been on the market for many years—the flagship Ice Black Tea was launched in 1995, Cha Li Wang in 2000, Assam Milk Tea in 2009, and Hai Zhi Yan and Xiao Ming Tong Xue in 2014 and 2015, respectively. Since then, there have been no true blockbuster hits.

The development history of the sugar-free tea track directly reflects Uni-President's short-sightedness in strategy. Currently, Cha Li Wang and Chunfu Green Tea are still in the investment and cultivation phase. Under the already solidified competitive landscape of the sugar-free tea market, it is extremely difficult for Uni-President's sugar-free tea products to break out.

At the same time, the fierce market competition landscape further amplifies the shortcomings of Uni-President's beverage business.

In the bottled tea drink track, Master Kong strongly controls the market through mass affordable products, Oriental Leaf firmly holds the leadership position in the sugar-free tea field, while Genki Forest and Suntory continue to squeeze the space.

Additionally, offline freshly made tea drinks continue to divert audiences from bottled milk tea and juice products. Under multiple squeezes, Uni-President's beverage growth space continues to narrow.

More importantly, there is a 先天 (innate) shortcoming in channels. For a long time, Uni-President's channel network has always been weaker than Master Kong's, with insufficient coverage in lower-tier markets. Beverage products rely heavily on freezer placement, terminal display, and distribution efficiency, requiring extremely high standards for refined channel management and terminal resource investment.

Against this background, in recent years, whether seizing the sugar-free tea track, electrolyte water, or popular niche tracks like health water and lemon water, Uni-President has remained in a relatively weak position.