MINISO Group Q4 2025 Earnings Results & Report

MINISO Group EPS Results

• Actual EPS: N/A
• Consensus EPS: $0.3764
• Beat/Miss: N/A
• One Year Ago EPS: N/A
• EPS Beat Rate: 0 of last 4 quarters

MINISO Group Revenue Results

• Actual Revenue: N/A
• Expected Revenue: $889.16 million
• Beat/Miss: N/A
• YoY Revenue Growth: N/A

MINISO Group (NYSE:MNSO) Holding Limited is a global value retailer that designs, develops, and sells a broad range of lifestyle products. Its offerings include household goods, personal care products, cosmetics, accessories, electronics accessories, stationery, toys, food, and seasonal merchandise, generally emphasizing affordable prices, practical design, and frequent product refreshes.

The company operates primarily through the MINISO brand, which is supported by a combination of directly operated and partner-operated stores. MINISO also owns TOP TOY, a brand focused on collectible toys and related products. Its retail locations are commonly found in shopping centers, commercial districts, and other high-traffic areas.

Founded in China in 2013, MINISO has expanded beyond its domestic market into international markets across Asia, Europe, North America, Latin America, the Middle East, and Africa. The company serves customers through an extensive global store network and digital channels, with product offerings and store formats adapted to different markets.

MINISO was founded by Ye Guofu, who serves as the company's chairman and chief executive officer. The company became publicly listed on the New York Stock Exchange in 2020 under the symbol MNSO.

MINISO Group Q4 2025 Earnings Call Transcript

Key Takeaways

• Positive Sentiment: Q4 revenue accelerated to RMB 6.25 billion (up 32.7% YoY) and full-year revenue reached RMB 21.44 billion
• Positive Sentiment: Same-store sales strengthened materially — MINISO China SSS hit mid-teens in Q4 and U.S. SSS exceeded 20% — with growth increasingly driven by higher-quality SSS versus net new store openings.
• Positive Sentiment: Management is doubling down on experiential large-format stores and IP: 26 MINISO LAND destinations opened by year-end and proprietary IP momentum (e.g., YuYu surpassed RMB 100m in <6 months and is guided toward RMB 600m–1bn potential in 2026) to drive traffic and higher ASPs.
• Negative Sentiment: Margins and costs faced pressure as operating expenses rose ~45% (sales expense +47.4%), licensing fees +107%, and Q4 saw GP margin compression; reported results also included substantial non‑IFRS items (share‑based comp, CB interest, RMB 1.84bn YH loss) that management adjusted out.
• Positive Sentiment: 2026 outlook targets high‑teens revenue growth, ~510–550 net new stores with focus on quality, accelerated adjusted profit growth and Q1 revenue guide ≥25% (management will exclude a one‑time ~RMB 850–900m fair‑value gain from an AI investment—MiniMax—from adjusted metrics).

[Operator]

The earnings result presentation. At this time, all participants are in listen-only mode. Following the management prepared remarks, we will open the floor for Q&A. Before asking a question, please identify yourself and the organization you are working for. Please also be noted that the call will be recorded. Simultaneous English translation will be available for this call. You can select your preferred language by clicking Interpretation in the Zoom toolbar. Our December quarter and full year 2025 results are disclosed earlier today and are now available on our investor relationships website at ir.MINISO.com. Joining us here today are Mr. Ye Guofu, our founder and CEO, and Mr. Zhang Jingjing, our CFO. Before we proceed, I would like to refer everyone to the safe harbor statements in our earnings press release, which was also applied for this call.

[Operator]

As management will be making forward-looking statements, please also note that we will also be discussing certain non-IFRS financial measures today. Those measures are described and reconciled to their most directly comparable IFRS measures in our earnings release and our filings with the SEC and Hong Kong Stock Exchange. Unless otherwise stated, all figures are in RMB. In addition, we have prepared a presentation featuring financial and operational highlights for today's call. If you join in Zoom, you will be able to see the slides. They will also be available on our IR website. Now I return the floor to Mr. Ye Guofu.

[Ye Guofu, Founder, Chairman, and CEO at MINISO Group]

Good day, everyone. Welcome to MINISO 2025 December quarter and full year earnings presentation. 2025 was the year for steady growth and continued breakthrough for the group.

[Ye Guofu, Founder, Chairman, and CEO at MINISO Group]

Throughout the year, the revenue growth followed a strong and constant acceleration trajectory, rising from 80.9% YoY in Q1 to 32.7% in Q4. Surpassing the upper end of our prior guidance and also reaching RMB 6.25 billion in quarterly revenue, marking the first time we have crossed CNY 6 billion quarterly revenue milestone. Looking at our core brands in detail, the MINISO brand recorded its fastest growth rate in nearly eight quarters in Q4, with revenue up by 28%, reaching RMB 5.65 billion. Meanwhile, TOP TOY delivered exceptional momentum, posting 112% YoY growth in Q4, with quarterly revenue approaching RMB 600 million, demonstrating the powerful dynamics of our multi-brand portfolio.

[Ye Guofu, Founder, Chairman, and CEO at MINISO Group]

This year, we achieve higher revenue growth with fewer net new store openings than 2023, with greater share of the growth driven by the same-store sales, reflecting a more efficient and high-quality growth model, reaffirming the resilience and the long-term growth potential of our multi-IP plus multi-category and globalization business model. Today, against the backdrop of the group's full year operating performance, I will share with you the significant progress that we made in the past one year regarding MINISO strategy for the past one year, particularly focused on the breakthrough in brand activation and the store experience enhancement. First, let's take a look at MINISO China. In the fourth quarter, the MINISO brand generated a revenue of RMB 5.65 billion. Mainland China contributed RMB 2.87 billion, growth by 25%, representing 51% of the total.

[Ye Guofu, Founder, Chairman, and CEO at MINISO Group]

MINISO overseas revenue reached RMB 2.78 billion, up by 31%, accounted for 50% of the total, reflecting a robust financial growth driven by both domestic and international operations. Let's first talk about strategic initiatives in MINISO mainland China business. In Q4, MINISO domestic same-store sales grew by mid-teens in Q4, a record high for the year, with average daily sales per store surpassing the level achieved in 2023. Even 2023 was largely driven by surge in post-pandemic pent-up demand. MINISO ability can exceed those peak levels. This can tell its genuine structural improvement rather than the cyclical tailwinds, and we have every confidence, assuming a more supportive macro environment and a gradual recovery in consumer sentiment in 2026. With our stronger brand equity, superior store positioning, more agile supply chain, and competitive standing, we will be able to outperform the industry by a wide margin, capturing more shares in the market.

[Ye Guofu, Founder, Chairman, and CEO at MINISO Group]

By the end of Q4, our domestic franchisee count reaching 1,457, reaching historical high. Franchisees vote with their support. That is the most authentic market signal, and they partnered with us because they have witnessed it firsthand, the traffic momentum, and the financial returns of our large format stores. The trust has been earned store by store, IP activation by IP activation, and it is something that we hold in the highest regard. At our 2024 Investor Day, we articulated our vision to make MINISO the go-to happy destination for international consumers worldwide. Today, the vision is being realized one MINISO LAND store at a time.

[Ye Guofu, Founder, Chairman, and CEO at MINISO Group]

By the end of 2025, we have already opened 26 MINISO LAND format stores in mainland China, securely in primary location in Tier 1 cities like Beijing, Shanghai, Guangzhou, and Shenzhen, and also distinctive retail destinations in Harbin, Haikou, and Guiyang. In January, the MINISO LAND opening in Grandview Mall in Guangzhou, attracting nearly 10,000 visitors on its opening day, generating RMB 450,000 in sales, a new record in South China region. Equally impressive is the MINISO LAND flagship opening in the lower tier cities in Urumqi and Nanjing. The Nanjing store soft opening drove 80% YoY growth in overall mall footprint traffic. Urumqi store, featuring a three-story impressive space and a portfolio of over 100 IP collaborations, quickly established itself as a regional primary destination. Such high quality of experience store are at their core, the engine for IP operations.

[Ye Guofu, Founder, Chairman, and CEO at MINISO Group]

Through the authentic spatial design and the curated product presentation, they draw consumers in and, as such, the perceivable and tangible in-store experience brings IP value to life. It can also help us to continue to improve our brand IP ecosystem. The MINISO LAND store, combined with blockbuster IP activation, has become the go-to platform for creating citywide mainstream brand momentum. Tens of thousands of consumers share their experience on Xiaohongshu, Douyin, and WeChat Moments. That's the reason I always tell you our physical stores are MINISO's most powerful brand billboard and our most enduring source of consumer traffic. MINISO is not the first brand to pursue large format store trajectory. While others come for photos, the answer comes down to just one thing. A successful large format store must build on the foundation of strong proprietary product development capacity.

[Ye Guofu, Founder, Chairman, and CEO at MINISO Group]

Without in-house design and R&D capacity, a large format store is nothing but an empty shell. Behind that, we have more than one decade supply chain deployment, a network of more than 1,500 global suppliers, and a design team of over 1,000 professionals. In this process, no one will be able to copy the successful story from us. They have to build the core capacities. MINISO moved even further ahead. In support of our MINISO LAND strategy, we established a 7-tier store format mix in 2024, continue to refine and evolve it through 2025. Our goal is to ensure every city, every trade area, and every consumption scenario will be served by MINISO format precisely. In the past, I mentioned MINISO's intentions to systematically upgrade its store portfolio. I also would like to share with you the reason behind such initiative.

[Ye Guofu, Founder, Chairman, and CEO at MINISO Group]

Why every new store we open must be large format, high quality, and MINISO LAND format store. If we look at our journey, we navigated two distinctive strategic phase. First, rapid global store expansion to build scale, followed by strategic IP positioning, transitioning ourself from a value price variety store into interest-driven consumption destination. We achieved milestone in both phases. Now we move into the third phase, an immersive retail transformation centered on MINISO LAND. It's not only increasing store size, it is an integration of the store capacity built across first two phases, leveraging larger space, creating immersive environment, forging genuine emotional connections, driving repeated visitor. We are selling and translating from selling the product to selling experience, from traffic-driven business to loyalty-driven consumer-centered ones. People are never lack of a good product. They are truly seeking for compelling destination, memorable experience, and moments worth sharing.

[Ye Guofu, Founder, Chairman, and CEO at MINISO Group]

Our IP-driven land are designed precisely to meet those needs, that we can inspire consumers to share and continue to come back for, to generate purchase. Regarding international market, our overseas revenue approached RMB 2.8 billion in Q4, all-time high, representing 31% YoY growth. Our overseas store net add was 159 stores, bringing a full year net increase of 465 stores. Our largest overseas market, the United States, delivered a full year growth more than 60% and 57% in Q4. Same-store growth was more than 20%, all ahead of our prior expectation. At our Q1 2024 earnings call, I stated improving store operating quality in North America was our top priority in 2025. A year on, MINISO U.S. business delivered comprehensive improvement on store quality, operational efficiency, and consumer engagement. For stores, our new store quality being further improved.

[Ye Guofu, Founder, Chairman, and CEO at MINISO Group]

Sales of the new store in 2025 have all-time high, grow by a double-digit number, and those average transaction value and transaction volume all improving, driving meaningful higher unit level profitabilities and conversion rate. While at the same time, our mature store demonstrate a strong operating resilience. Leveraging a refined same-store performance tracking model, establishing store to deliver YoY growth, both the average daily sales and the transaction improving alongside gains in foot traffic and the purchase frequency. Especially for our plaza store format, we opened 48 plaza locations in 2025. They generate higher attachment rates and average transaction value, ASP. The average ASP outperforming our mall stores, establishing a more flexible and economically retained new store expansion channel. Operationally speaking, we have cluster-based expansion strategy, improving logistics efficiencies and warehouse cost. Employee retention improved. Revenue per headcount increased.

[Ye Guofu, Founder, Chairman, and CEO at MINISO Group]

Labor cost as a percentage of sales declined, achieving a dual optimization on cost and productivity. For consumer side, membership in U.S. market grew by 150% YoY. The member-driven sales exceeded 50% of the total revenue for the first time. Together, those results mark U.S. market transition from an investment phase into a phase of high quality profitable growth, becoming our most resilient and dynamic engine for global expansion, which actually gives us great confidence for our global growth strategy. The operational challenges we encounter in other markets are also encountered and navigated in both China and U.S. We are going to leverage our experience from China and the U.S., continuing to unlock profit potential for our international operation. Thirdly, let me talk about TOPTOY. TOPTOY sustained its strong compound growth momentum in Q4, with revenue up by 112%. Reaching nearly RMB 600 million revenue in Q4.

[Ye Guofu, Founder, Chairman, and CEO at MINISO Group]

In terms of the store footprints, by the end of 2025, TOP TOY operated a total of 334 stores, including 30 international stores in Thailand, Malaysia, Indonesia, and Japan. Brand global expansion continued to accelerate. Domestically speaking, TOP TOY growth strategy centers on high frequency of the proprietary product launch to drive same-store sales. The proprietary IP, Nomie, actually regained momentum with sales of more than RMB 200 million and likely to be doubled in 2026. By the end of 2025, TOP TOY has built a proprietary IP portfolio of more than 20 brands. In 2020, I first introduced interest-driven consumption. The consumer's core needs is rapidly shifting from the pure functional value to emotional and experiential value, which is being fully validated by the market. MINISO stands as one of the most significant beneficiaries and pioneer of this consumption transformation with our immersive IP experience, multi-category proprietary development capacity.

[Ye Guofu, Founder, Chairman, and CEO at MINISO Group]

Those are our key and the hardest to replicate competitive moats in IP-driven consumption era. MINISO's strategic vision is to become the world's leading IP-driven retail platform. My strategy is becoming even clearer. Along the way, we have demonstrated the execution of our strategic development is right, and we also witnessed firsthand the genuine and sustainable enthusiasm we have from the consumers. For the past one year, we delivered strong results in both China and the US The road ahead is long, but with each step forward, our conviction and confidence only deepen. That's all for my remarks. Coming next, I'm going to hand over to Eason to walk you through the financial highlights for Q4 and full year. Thank you.

[Eason Jingjing Zhang, CFO at MINISO Group]

Thanks for Ms. Ye. Welcome you all. Coming next, let me just walk you through MINISO Group financial results for Q4 and full year 2025.

[Eason Jingjing Zhang, CFO at MINISO Group]

I will also provide you the outlook. I should also say that all the units will be RMB unless otherwise stated. Let me just start by reviewing financial performance against Q4 and full year. In Q4, revenue grew by 32.7%, supporting the upper end of our private guidance between 20%-30%, driven by the outperformance across all business segments. MINISO China Mainland Q4 revenue grew by 25%, exceeding our private guidance of a high-teens growth. MINISO overseas Q4 revenue grew by close to 31% YoY, ahead of our guidance of a low- to high-20% growth. TOP TOY Q4 revenue grew by 112%, above our guidance of 80%-90% growth. Q4 momentum lifted full-year group revenue growth by 26.2%, exceeding our prior full-year guidance of approximately 25% in the interim result. In Q4, MINISO China Mainland same-store sales growth reached mid-teens.

[Eason Jingjing Zhang, CFO at MINISO Group]

U.S. same-store sales exceed 20%, both supporting our prior Q4 guidance of a lower double-digit same-store growth. Both markets deliver high single-digit same-store sales growth for the full year in line with our formal guidance, but ahead of the internal expectation we had when we provided the guidance back in November. Adjusted operating profit growth by 12% in Q4, in line with our private guidance of the double-digit growth. Full year adjusted operating profit reaching RMB 3.67 billion, in line with our guidance. In Q4, adjusted operating profit margin was 17%, especially in H2 of 2025. We have already narrowed down the margin compression. Well, let's take a look at the revenue. We have already created three revenue milestones in this quarter. First of all, single quarter GMV exceeding RMB 10 billion for the first time.

[Eason Jingjing Zhang, CFO at MINISO Group]

Quarterly revenue surpassed RMB 6 billion for first time, and full year revenue crossed more than RMB 20 billion for the first time. Benefiting from all the outstanding performance, we deliver across all of our business line an over-expectation performance. By brand, MINISO brand generated Q4 revenue RMB 5.65 billion, 27.7% increase. MINISO China continued to demonstrate great growth. In Q4, its average growth is the highest one for the past eight consecutive quarters. MINISO overseas revenue was RMB 2.78 billion, up by 30.5%. TOP TOY revenue was RMB 600 million, up by 112%, and also having a triple digit YoY growth with very strong momentum that exceed our expectation. Turning to the full year, group revenue reached RMB 21.44 billion in 2025. A few highlights I'd like to share with you.

[Eason Jingjing Zhang, CFO at MINISO Group]

MINISO mainland China full-year revenue crossed RMB 10 billion milestone for the first time in such a consumption background, grew by around 70%. MINISO overseas full-year revenue was RMB 8.6 billion, up by close to 30%. TOP TOY full-year revenue was RMB 1.9 billion, maintained a very strong growth. In terms of the geographic revenue mix, mainland China revenue grew by 22%, accounted for 60% of the total revenue. Overseas revenue grows by 33%, representing 40% of the total revenue. We'll take a look at the same-store sales performance. MINISO mainland China Q4 same-store continues its sequential acceleration, reaching mid-teens, going beyond our expectation. Looking back to the full-year trajectory of the MINISO mainland China same-store sales. From negative mid-single digits in Q1 to positive low-single-digit in Q2, to high-single-digit in Q3, and finally mid-teens in Q4.

[Eason Jingjing Zhang, CFO at MINISO Group]

Sequential progression delivered mid single digit same-store growth for the full year, already exceeding our initial target in the middle of 2025. As I have already shared with you, delivering the improvement in the domestic same-store sales, that we did many hard efforts. In terms of the internal management, the same-store performance has been built into the KPI. We also have the digital infrastructure, making the business flow more digital and intelligent to improve the one team empowerment. Certainly, we have the operation improved, and we improved the store SOP with supply chain optimization and making sure that sustained contribution from the top selling SKUs and then minimizing the potential sales loss. Fourthly, the product development efficiency has been further improved. We actually have more contribution from new SKU and speed to shelf of the new product launch. Fifthly, the inventory cap policy.

[Eason Jingjing Zhang, CFO at MINISO Group]

Regarding the operations, we are also working at three fronts, including consumer product and channel. For people and consumer, we improve the in-store conversion. Our extensive store network serves as large scale testing ground and rich data pool. By deploying additional foot traffic counter, we're able to capture high frequency store level data that can help to further optimize our store and operation. We also have diversified marketing activations. For example, for this year, we have the one day store manager program on Bread, Artist Street pop-ups, as well as in-store meet and greet, signing events, and celebrity store visit, which can actually become the viral moment on the social media, driving organic brand amplification through fan engagement. Regarding product, let me just give you another two points.

[Eason Jingjing Zhang, CFO at MINISO Group]

We're capitalizing on seasonal and holiday product trends, where at the same time, we're also managing IP and non-IP merchandise with a profound understanding. We leverage the traffic-driven power of IP product to generate attachment, purchase, and lift the basket contribution for the non-IP items. Regarding the channel, we improve our existing store portfolio. We have upgraded and improved 300 stores with a tangible result. Regarding MINISO overseas, same-store sales performance are different from region to region. First of all, in Asia and in Latin America, the same-store performance is lagging behind than other international markets. However, our strategic direct operated market, United States and Europe, deliver very good results, especially our key strategic direct operated store market, U.S., deliver low-20s% same-store growth in Q4, supporting our previous guidance. We're driven by the strong end market performance and continued polish of our store.

[Eason Jingjing Zhang, CFO at MINISO Group]

You can also see that we see a healthy improvement of the same-store profit margin through disciplined data-driven site selection and cluster-based store opening approach. U.S. back end overhead costs declined by low single digits, providing further tailwinds to U.S. business profitability. It is also worth noticing that in 2025, U.S. business faced meaningful tariff headwinds. Against a backdrop of significant macroeconomic uncertainties, our team responded with exceptional foresight, sharp marketing insights, and agile execution, still be able to deliver standout set of the results. Such results validate our robustness and business model. Such strength in and out is actually the foundation for our confidence to navigate any economic cycle. While domestic market as our strategic home base deliver sequential accelerating positive same-store sales growth in a highly competitive market, which demonstrate our strategic model and exceptional execution capacity of the team, creating a suitable scope for further growth.

[Eason Jingjing Zhang, CFO at MINISO Group]

In 2026, successful story and playbook from China to United States will be exported to Southeast Asia. With respect to the challenges in Southeast Asia market, we believe the headwinds are already nearing the bottom. That in 2026, through a comprehensive upgrade of our channel strategy, product assortment, and organizational structure and talent base, we will be able to continue to improve the business in Southeast Asia. Regarding the stores, actually, with total store count approaching 8,500 by the end of 2025. In Mainland China, the net add is 182 stores, compared with 460 in 2024. MINISO Mainland China recorded revenue growth that was around 10% in 2024. However, in 2025, it was close to 17%. In other words, with a clear indication that we have transitioned towards a higher quality and more productive growth model with fewer net new stores.

[Eason Jingjing Zhang, CFO at MINISO Group]

MINISO overseas new adds was 465, bringing a year-end total to 3,583. TOP TOY new adds was 58 stores. TOP TOY started global expansion by Q4 of 2024. Just within one year, we have 30 stores international wide, present in Malaysia, Indonesia, Thailand, Japan, and Macau. By the end of 2025, our domestic land format store portfolio, including MINISO SPACE, MINISO LAND, and MINISO FRIENDS, has reached 26 destinations across 90 cities nationwide. That format and the flagship large store collectively accounted for 10% of our domestic store count, yet contributed nearly 20% of our domestic GMV. This number will continue to ramp up, which helped validate big store drives big results logic. In 2026, we'll accelerate the release of this momentum and you can see, including CDF in Sanya, David City in Zhengzhou, and Grand Gateway 66 in Shanghai, we'll continue to see our new locations being operational.

[Eason Jingjing Zhang, CFO at MINISO Group]

In Q4 of 2025, we opened our first overseas MINISO LAND at Siam Paragon in Thailand with very strong market reception, which helped us to understand the potential of our overseas formats remains substantial. In 2026, we'll continue to bring the immersive land experience to more retail destinations across the world. For overseas directed operating markets, led by United States, we plan to have the strategic new openings before Q4. In that way, Q4 would be fully concentrated on in-store operational excellence and experience optimization, so that the peak shopping season arrives, we will be able to fully maximize the growth momentum. Regarding the GP margin, that was 46.4% compared with 47% the same period of last year. In 2025, the GP margin was 45%, flat for the past five years. Our GP margin jumped from 28%-45%, driven by our brand activation, globalization, and IP strategy.

[Eason Jingjing Zhang, CFO at MINISO Group]

During the years, we made selective gross margin adjustments across product categories, which enable better sales performance and an overall increase in GP margin. In the near future, we're going to continue to manage the balance between margin rate and sales volume, maintain a healthy high-quality growth. Regarding operating expenses, the operating expenses in Q4 grew by 45.3%. Sales expense grew by 47.4%, 3% higher than the same period last year. Administrative expense grew by 36.3%, accounted for 5% of the revenue, flat with last year. The increase in the sales expense was attributable to the growth in direct operated store costs, licensing fees, and advertising and marketing expenses. First of all, our international expansion is still in the early stage.

[Eason Jingjing Zhang, CFO at MINISO Group]

Direct operating stores are in need of rent and manpower, which was 1% higher than the previous year, accounted for 40% of the total revenue, with total costs growing by 40%. However, it's already a deceleration from 54.5% growth rate in the first nine months of 2025. Secondly, licensing fee grew by 107% year-over-year, accounting for 3% of the revenue, up by one percentage point compared with 2024. This also helps to reflect our proactive upfront investment in IP strategy. Thirdly, advertising and marketing expense grew by 30%, slightly below the rate of the revenue growth in Q4, with the ratio to revenue remaining flat compared with 2024. The increase in G&A, and you can see adjusted operating profit. The Q4 adjusted operating profit grew by 7.7%, and adjusted operating profit margin reaching 70%.

[Eason Jingjing Zhang, CFO at MINISO Group]

Full year adjusted operating profit, no matter for MoM or year-over-year basis, you can also see our operating actually continued to be well managed. From the P&L perspective, in Q4, GP margin declined by 60 basis points, because Q4 2024 was our highest GP margin quarter on record. Also direct operating store cost ratio increased by 1 percentage point. Licensing fee ratio increased by 1 percentage point, with a further contribution from the licensed items of the IP team, tens of basis points, result in a total adjusted operating margin impact by 3%. For the full year, GP margin flat versus 2024, mainly due to the direct operating store ratio increased by 2 percentage points. Licensing and other fees increased by 1 percentage point, resulting in a 3 percentage points improvement adjustment.

[Eason Jingjing Zhang, CFO at MINISO Group]

Whereas at the same time, you can also see that in mainland China, from the business unit perspective, the BS business unit part, China franchise business store margin declined by only 70 basis points against a backdrop of 70 percentage points of the revenue growth. This reflect our conservative approach for gross margin exchange for healthy volume. At the same time, the growth was also contributed by our Super Warehouse and e-commerce operation with a modest dilutive effect on margin. The group level margin decline is primarily attributable to the compression in overseas margin. For example, direct operated store revenue as a proportion to the total gross overseas revenue has been increased from 1/3 in 2024 to more than half in 2025. Outside North America. Other directed operating market remained in the early investment phase and carry low margin.

[Eason Jingjing Zhang, CFO at MINISO Group]

By contrast, our objective agent and franchise revenue, which carry high margin, grow at a relatively slow pace. In our financial statement, we also have some non-IFRS adjustment. There are five points. First one, share-based compensation, SBC. It was RMB 150 million in Q4 and full year RMB 270 million, and that used to be RMB 85 million in 2024. The increase was mainly because of the equity incentive plan we made for the team. The second one is the loss from the derivatives, fair value changes and CB issuance cost. The third one is the interest expense on CB and the YH investment related loans. In Q4, convertible bonds interest expense was RMB 51 million, of which RMB 47 million are in non-cash. Interest expense on acquisition loan related to YH was RMB 24 million.

[Eason Jingjing Zhang, CFO at MINISO Group]

For 2025 full year, you can see the convertible bonds interest expense was RMB 190 million, among which RMB 170 million are non-cash interest on the YH acquisition loan was RMB 87 million. The fourth point is share of the YH post-tax loss. In Q4, YH's immediate net loss was RMB 1.84 billion. Fifthly, you can also see that we have the fair value changes of the redemption liability arising from the preferred shares. The change was related to RMB 150 million-RMB 160 million. It related to the strategic financing completed last year. In aggregate, the adjustments added back approximately RMB 990 million in Q4 and RMB 1.69 billion for the full year to arrive at adjusted net profit. Excluding the item discussed above, the adjusted effective tax rate was 20.2% for Q4 and 20.1% for full year. Q4 adjusted net profit was growing 7.6%, reaching RMB 815 million.

[Eason Jingjing Zhang, CFO at MINISO Group]

However, as a result of our active share repurchase and consolidation program, our adjusted EPS grew slightly faster than growth. The adjusted diluted EPS in Q4 grew by 9.4%. Full year reached 7.8%. Regarding working capital, by the end of 2025, inventory turnover was 100 days, 91 days in the same period of last year. In Greater China, inventory turnover was 74 days. International inventory turnover was 228 days. The increase in overseas inventory days reflects a strategic inventory ahead of the anticipated traffic impact, locking in the cost at the favorable level. We also have established local direct sourcing, which can actually help to balance inventory pressure and ensure continued new product replenishment. In the near future, we are also going to adjust our overseas inventory and overall efficiency. By the end of 2025, our cash reserve was RMB 7.1 billion and remained healthy.

[Eason Jingjing Zhang, CFO at MINISO Group]

In 2025, full year net cash generated from operating activity was RMB 2.58 billion, accounted for 90% of the full year adjusted net profit. A reflection of our business resilience, high earning quality and strong cash generation. Capital allocation means we're going to maintain our commitment for rapid business growth. In 2025, we obtained approval from Hong Kong Stock Exchange with repurchase up to RMB 1.8 billion. You can also see that we continue to have the repurchase that can showcase our commitment and confidence for the full year. Looking at the 2025 full year, the return to shareholders account for RMB 1.9 billion, accounted for 66% of the full year adjusted net profit, including RMB 550 million in share purchase and RMB 1.36 billion in dividends.

[Eason Jingjing Zhang, CFO at MINISO Group]

You can also see the board has already announced final dividends of RMB 810 million, representing 50% of the second half 2025 adjusted net profit, which will be expected to be paid in April this year. Last but not least, closing remarks and outlook. Looking back at our financial performance over the past five years, from 2021 to 2025, revenue CAGR reached 21%, adjusted net profit CAGR reached 44%. Looking to 2026, we expect group's revenue will have a high teens rate. The three-year CAGR from 2023 to 2026 will be no less than 22%. We expect the same-store sales continue to ramp up in 2026. The same-store sales in key markets like China and North America maintain healthy low single-digit growth. We plan to have a new store 510-550 for the full year. We stick for quality rather than quantity.

[Eason Jingjing Zhang, CFO at MINISO Group]

In 2026, we balance growth and efficiency, pursuing profitable growth and profit backed by strong cash flow. We expect those adjusted operating profit and adjusted net profit will accelerate their growth rate in 2026. In terms of the profit phasing, the peak retail season for offline retail in North America and Europe is in the second half of the year. For many Western offline brands, 60%-70% of the annual revenue were generated in H2. Our direct operated revenue from North America and Europe will continue to grow. Around 60% of the revenue are coming from H2, and H1 accounted for 40% of the total contribution. In Q1 2026, the revenue growth were no less than 25%. China same-store sales maintain high single-digit growth, most same-store per store delivers strong mid- to high double-digit growth. It is worth noticing, Q1 profit will include a significant investment gain from specific investment.

[Eason Jingjing Zhang, CFO at MINISO Group]

It was generated from a test investment we made a few years ago. The company's been quite positive on AI company. We invested in a type AI company. That company's been IPO'd. The company's share price appreciated, generating a substantial fair value gain, and it actually bring us an extra RMB 850 million-RMB 900 million. It is worth noticing that such extra gains will not showcase our primary business resilience. We plan to exclude this item from adjusted operating profits and adjusted net profit. That's all for our prepared remarks. Let's open the floor for Q&A.

[Operator]

Ladies and gentlemen, please change your name into a name with your institution name. In order to make sure we allow and accommodate more analysts and investors, please make sure you raise no more than two questions at a time. Thank you. First of all, let's welcome Michelle from Goldman Sachs. Please.

[Michelle Cheng, Analyst at Goldman Sachs]

Hello. Mr. Ye and Eason, thanks for giving me the chance to raise a question. Congratulations on the company achieving such a nice growth in the volatile market. I have two questions. The first question is regarding the domestic market. Last year, we observed same-store sales growth through refined store operation, stronger, faster sales execution, and store network upgrades. Looking ahead to 2026, as Eason has already provided guidance, is it possible for you to be more elaborate on the key lever to drive further same-store sales improvement? The second question is regarding the U.S. market. We do notice the sales was looking bright in the U.S. market. However, localized sourcing would somewhat pressure your GP margin. What are your priorities for merchandise supply chain and store expansion this year? What is the expected impact on margin improvement? That's the two questions I have. Thank you.

[Ye Guofu, Founder, Chairman, and CEO at MINISO Group]

Thank you.

[Ye Guofu, Founder, Chairman, and CEO at MINISO Group]

Our core level for driving domestic same-store sales in 2026 are clear. There are three. The right IP. For example, the JENNIE co-branded product, which can actually help to further consolidate our revenue and the brand impact. The second one is right product. The third one is right experience. Well, regarding the right product, we attach great importance to the product quality, same as ASP, and we also open large stores to provide a good customer experience. You can also see that JENNIE collaboration was first launched exclusively at MINISO LAND and themed pop-up locations, creating fully immersive IP experience. The limited time pop-up at Hang Lung Plaza in Shanghai generated RMB 2.2 million in sales on the opening day alone, setting a new single-day record for any MINISO pop-up in 2025.

[Ye Guofu, Founder, Chairman, and CEO at MINISO Group]

This not only validates extraordinary pull of our land format store as a primary destination for IP launches, it also demonstrates a fundamental truth. Prime offline experience combined with top-tier IP content are the golden formula for unlocking global consumer demand and maximizing the IP value. As many of you may know, the Hang Lung Plaza is actually a top shopping mall, which is quite influential, and all these stores and brands are the super luxury brands. We will be able to move into such department stores to launch our IP product. This represents the recognition from the top shopping malls and the recognition from the top valuable consumers. At the same time, the breakout IP product extend our customer range beyond existing audience, elevating average transaction value ASP and strengthen repeated purchase behavior.

[Ye Guofu, Founder, Chairman, and CEO at MINISO Group]

Together with our store upgrades, they form a powerful virtuous circle, enhance the store format, provide superior showcase and conversion environment for IP, where IP product in turn provide a targeted and highly loyal customer base, jointly driving sustained high quality same-store sales growth. For us, IP business never purely about selling product. We can start to leverage MINISO global supply chain capacity, category development expertise, omni-channel reach to give every great IP and every talented creator a bigger stage, and to build a more enduring IP that stand the test of the time and earning long trust consumer affection. The JENNIE collaboration is actually a new era we tap into of working with international well-known celebrities. In the past, we have the image IP and the content co-IP.

[Ye Guofu, Founder, Chairman, and CEO at MINISO Group]

However, a collaboration with JENNIE actually showcase a new co-brand IP with celebrities, which actually provide ample room for the future cooperation. You see that for one of our peers, they actually have a close collaboration with Lisa, which bring a great and extraordinary global value by working with celebrities. We will be able to continue to improve and maximize the IP value. They are all the world top artists and the KOL. At the same time, I also would like to share with you based upon our latest operating data, we expect domestic same-store sales growth in Q1 will be quite aggressive. In 2026, we hope that we're going to be delivering more surprises. We hope more investors will take a look at that and working with more celebrities in the near future. The second question you asked about is the product and IP strategy.

[Ye Guofu, Founder, Chairman, and CEO at MINISO Group]

We will continue to deepen our dual-engine approach of top-tier IP collaboration plus local market adoption. On one side, we'll intensify our partnership with leading global IP. On the other side, we will further extend our store spend on high-margin categories like home goods, plush, and blind box. Just now you mentioned the U.S. market. In terms of the local direct sourcing, we will optimize our SKU architecture to focus on high velocity and high-margin items, achieving a better balance between scale extension and the GP margin. I have just traveled from the United States back. In 2026, we're going to have a more precise analysis on what product need to be sourced locally and what need to be shipped there from domestic China. Sometimes sourcing from domestic China will present high margin. In 2025, due to the volatile tariff policy, we actually released more room for local sourcing

[Ye Guofu, Founder, Chairman, and CEO at MINISO Group]

However, in 2026, we believe the tariff turmoil has already gone. We will be more certain and clear on what are going to be exported from China to U.S. and what are going to have the localized sourcing. Regarding the margin, let me be frank. At the procurement aspect and the headquarters sourcing, we need to further improve our efficiency, optimize the merchandise mix, and then to improve the GP margin structure as a whole. Our target was to further improve operating margin in 2026 with a more pronounced recovery expected in H2 of the year. We provide a six-month offer in H1 of this year. I believe H2 of 2026 will be great, including our LAND store format. Internally, we keep an eye on increasing ASP and also the price per item.

[Ye Guofu, Founder, Chairman, and CEO at MINISO Group]

We are working very hard in order to further improve the ASP as well as the price per product, as well as GP margin per product.

[Michelle Cheng, Analyst at Goldman Sachs]

Thank you.

[Operator]

Thanks for Mr. Ye. Coming next, let's welcome Samuel from UBS. The floor is yours, Samuel.

[Samuel Wang, Research Analyst at UBS]

Thank you. Thanks for giving the chance to raise a question. I'm Samuel from UBS. I have a few small questions. The first question, Mr. Ye, in your prepared remarks, you mentioned something regarding IP. I'd like to ask you regarding your proprietary IP. What's the progress on proprietary IP? What are the sales target and strategic plan for 2026? What are the key third-party IP priorities? Anything you can share with us. My second question was regarding overseas market. That is specifically talking about Mexico market. In 2025, Mexico market faced headwinds. What is the outlook for 2026? My final question, I also would like to ask Mr. Ye. You mentioned you invested in an AI company. Can you disclose the name of that company? Thank you.

[Ye Guofu, Founder, Chairman, and CEO at MINISO Group]

Thank you. Three good questions. Let me respond to the first one. First of all, let me talk about our IP.

[Ye Guofu, Founder, Chairman, and CEO at MINISO Group]

First, starting by YuYu. With less than six months of its launch in 2025, YuYu has already surpassed revenue of more than RMB 100 million milestone. From January to March of 2026, YuYu related sales was already RMB 165 million, around RMB 50 million per year. According to this trend in 2026, for YuYu only, our sales will be RMB 600 million. If we also combine international market, it's going to be RMB 800 million or even RMB 1 billion, likely to hit a RMB 1 billion revenue milestone. The revenue was beyond our expectation. YuYu is actually a Chinese proprietary IP. If you take a look at our IP portfolio, YuYu is the first one to have a revenue exceeding RMB 100 million, it takes less than six months.

[Ye Guofu, Founder, Chairman, and CEO at MINISO Group]

There's no other Chinese proprietary IP that could run such a revenue growth as fast as YuYu, which can truly demonstrate our product and IP operation tactics and strategy, and our robust confidence in the operations of the IP management. Once we are working on that, we will be able to deliver faster growth. In terms of the product approach, we will carry forward the successful logic. We redefine the structural landscape for designer toy market, maintain the category innovation as a primary driver of the IP growth. All three product generation of YuYu released outstanding commercial result. First generation remain most popular. Till now, the average transaction value is still about RMB 400 today. The third generation product, the demand is go beyond our supply. Where at the same time, we also be clear that product sales are not one dimension of IP management.

[Ye Guofu, Founder, Chairman, and CEO at MINISO Group]

We place great emphasis on healthy, sustainable development of our IP. We will not sacrifice an IP longevity for the sake of short-term sales revenue. I believe 2026 will be a great year for YuYu, and we're very likely to have more product working with international outstanding IPs. For example, IP from the Disney family that are going to have a co-branded work with YuYu. That is how our proprietary IP working with the international IP for co-branding. Till now, we have completed a full pipeline of 30-40 proprietary IPs. Among them, we have IPs from South Korea, from Japan, and from Thailand, or even all parts of the world. Especially Kumade, Chiba, and Chuchu have completed the full proprietary process from creative design to the product readiness, and they will be introduced to global consumer in months ahead.

[Ye Guofu, Founder, Chairman, and CEO at MINISO Group]

Through those pipelines, we aim to fundamentally reshape the market perceptions of the MINISO IP categories and product potential, creating more robust IPs that deeply resonate with consumer needs. I also would like to tell you, on the 17th of May, we're going to have the MINISO photo gallery put into operation in Shanghai. That is going to be another key artist we're going to work with. That artist, one painting masterpiece can sell tens of millions CNY. When our MINISO art gallery has been put into operation, we're going to engage more artists to work with us. If we reflect on why YuYu is a great success, I think we do three things right. First of all, we constantly hold to our core conviction of category innovation to drive explosive IP growth. Product innovation is quite important. First generation of YuYu is outstanding.

[Ye Guofu, Founder, Chairman, and CEO at MINISO Group]

The success of YuYu can really allow us to recalibrate our direction for product innovation, and how category innovation is going to be for IP business. MINISO has been deeply involved in the industry for many years. We have built world-class capacity in multi-category product development and the depth of consumer insights. That can help us to rapidly convert a creative IP concept into best-selling product. Secondly, we work on IP narrative first, product commercialization second, ensuring that IP develop its own soul and emotional resonance with consumer before products are launched to crystallize the value, not the other way around. Thirdly, we built a fully integrated end-to-end closed loop from the upstream creative ideation to the back-end supply chain, to all the omni-channel distribution, enabling rapid response to consumer demands and efficient product iteration and launch.

[Ye Guofu, Founder, Chairman, and CEO at MINISO Group]

The IP incubation model is also the way underpins our future capacity of next generation blockbuster IPs. This is also MINISO's three-part competitive mode. World-class category development capacity, early-stage IP potential detection capacity, and high momentum multi-channel global distribution capacity. Those are the three strands that will continue to empower the growth of our all IPs. As you may have already noted, our flagship and new event format store are having many YuYu installations. That is quite important for IP promotion. You know that we do have a store in Causeway Bay, Hong Kong, where we don't have our proprietary IP. We can only show the Disney IP. In the next months, we're going to have the YuYu artist installations at the store. For any IP, you have to make sure expose the IP, especially your proprietary IP at the stores.

[Ye Guofu, Founder, Chairman, and CEO at MINISO Group]

That is our unique advantage of 800,000 stores worldwide. With the installations and the YuYu presence in the store, that will be the best way to promote the IP at our own store and make it visible and touchable by the consumer. The third point regarding the third-party IP and proprietary IP portfolio, I have nine words. More IP, more portfolio globalization. In other words, we need to have the global licensed IP plus the proprietary IP. International IP, they have their advantage. Some of them already have the same groovy, well-curated content and their own strengths. Proprietary IP also are having the attribute of scarcity. If it is only a MINISO proprietary IP, it's going to protect our business strengths. By having international IP plus proprietary IP, that will be the best business combination.

[Ye Guofu, Founder, Chairman, and CEO at MINISO Group]

As we're working together, we will be able to make sure we have a stable business and more work to be done. For example, recently we have the Journey collaboration, and we saw the Instagrammable moment on WeChat and the Xiaohongshu a lot. If we only do proprietary IP, I don't think the popularity will be that good. That's the reason I believe multi-IP, multi-category will for sure improve the consumer experience and also contribute to the business stability in long run. We need to be forward-looking rather than short-sighted. We multi-validated. Third-party IP plus proprietary IP would be the golden formula. We hope you can see after 2-3 years whether my words will be validated by the market or not. Till now, we also contracted some incubation of independent original artists, and we're also incubating the IP projects.

[Ye Guofu, Founder, Chairman, and CEO at MINISO Group]

Starting from 2026 in 2027 or beyond 2028, our proprietary IP development is going better. From the financial performance standpoint, proprietary IP outperforms third-party IP on gross margin contribution, owing to the stronger consumer loyalty, bringing pricing power, and absence of the licensing cost. The third part, the IP, in other words, is powerful complementary benefits in new customer acquisition, audience expansion beyond our existing base. It also provide us some very good content marketing advantage. The two are highly synergistic, together driving sustained and high quality growth of our IP-related business. You know that for MINISO LAND, the brand impact continue to ramp up. Many international IP are proactively approach us of working together. Even JENNIE, the international top artist, to work with us. JENNIE has a nickname as Ms. Chanel, because JENNIE is actually the brand ambassador for many luxury product.

[Ye Guofu, Founder, Chairman, and CEO at MINISO Group]

JENNIE's been happy with MINISO because of our strong brand awareness and customer experience. Well, let me just attend to the question regarding Mexico market. I was just coming back from Mexico. I'm fully confident on that market. I believe it's going to be better in the near future. Mexico market is going to be the top three in the global arena. You can see that I went to Mexico and I have a face-to-face guidance to the GM of Mexico market. We need to do brand upgrading in Mexico market, develop the land store format. We need to have the MINISO LAND and MINISO friends stores in the top 100 shopping malls in Mexico with GFA more than 800 sq m. In that way, the Mexico market going to see explosive growth. You know that I went to Mexico and they have 100 stores have brand Zara.

[Ye Guofu, Founder, Chairman, and CEO at MINISO Group]

All those stores have been taken as good shopping malls. Mexico landscape is very much like China. Their GDP per capita and consumption structure is very much like China with lower manpower cost. Mexico is actually in the best time for the offline business development. We hope Mexico could actually become a benchmark market we have in Latin American country. When Mexico thrive, the Latin America market would be driven, so we are fully confident in the Mexico market. We have a high expectation of Mexico market. Now we define Mexico market as our benchmark market. We will spend more effort and resources to make this market right. We have a very clear strategy for Mexico market. Same-store sales growth and future growth will be quite promising. My fourth point, you can see in Q1 of 2026, Mexico also have a high single-digit growth.

[Ye Guofu, Founder, Chairman, and CEO at MINISO Group]

However, it's still before the excessive growth of Mexico market. It's still taking the old business model, old store format. If follow my line of thinking, I believe 4 stores could be transformed into Land or Friends stores. There's one store with Hermès, Chanel, and Dior as the neighborhood. This store is just buy something unique and rather than the value for money. I asked them, please just close down that store, retrofit it, and sell the popular IP and the premium product. Mexico is being taken as the back garden of the United States. People come to Mexico really want to shop something unique. We find Mexico is a market with great opportunities. We find out Mexico have a great array of the high-quality shopping malls and with a very strong traffic flow. We're not going to sell the daily necessities.

[Ye Guofu, Founder, Chairman, and CEO at MINISO Group]

We're going to translate them into the flagship stores and selling the IP and the trendy toys along with the immersive experience, and to drive the incremental consumption to improve ASP. I believe after Q2, Q3, and Q4 performance is truly expected in Mexico. It will be able to retrofit our store into upgraded ones in top 100 shopping malls in Mexico. I believe the performance of that 100 store in Mexico will be doubled. The first question, this question was asking about our investment. We have been quite lucky. We invested in a company named MiniMax. That is an AI company. MiniMax being applied at our company very well, and I also would like to continue to work with MiniMax. We invested in MiniMax when they still have a very low valuation. Now the return is still looking pretty good. The name of that company is MiniMax.

[Ye Guofu, Founder, Chairman, and CEO at MINISO Group]

That's all. Okay. Thank you, Samuel, for your question.

[Operator]

Due to time reason, ladies and gentlemen, please make sure you raise just one question per time. Coming next, let's welcome Runbo from CICC.

[Runbo Yang, Analyst at CICC]

Hello, Mr. Ye and Eason. Thanks for giving me the chance to raise a question. My name is Runbo Yang from CICC. Just one question from me. In 2025, it seems Yonghui is pressuring your margin and financial statement. What will be your plan for Yonghui business?

[Ye Guofu, Founder, Chairman, and CEO at MINISO Group]

Thank you very much. First of all, I need to clarify to all MINISO shareholders, my primary focus has always been and will always be MINISO. It's our foundation and the core driver of our future growth going forward. It is also the foundation to make MINISO great. So you can sit and be reassured. 90% of my energy and time would be on MINISO.

[Ye Guofu, Founder, Chairman, and CEO at MINISO Group]

MINISO would always be my highest priority. My investment in YH will not distract my attention from that. Regarding YH, we have completed the management team transition with Wang Shoucheng be appointed as YH CEO. Under his leadership, YH has its own complete management team that are now independently responsible for the day-to-day operations and strategic execution of the business. Regarding YH future, we still feel confident. Well, for MINISO, me myself, I still would like to say MINISO will still be my highest priority. It is also the cornerstone for the company to further expand and making MINISO truly great. I always notice the market development and momentum of MINISO is quite unique worldwide. We will seize the opportunity, continue to ramp up our business, and making MINISO great. Thank you.

[Operator]

Okay? Thank you. Thanks for Mr. Ye. Coming next.

[Operator]

Let's welcome Shi Di from Huatai Securities, please.

[Shi Di, Analyst at Huatai Securities]

Okay. Thank you. I'm Shi Di from Huatai Securities. Congratulations on the company delivering a satisfying scorecard to the market, which is truly in line with the refined operation. Mr. Ye, you have already introduced a proprietary IP strategy. We have already noticed in 2026, you take it as an operating year for proprietary IP or the dimensional elevation for proprietary IP. What is organizational structure of the proprietary IP team now? What pathway and marketing initiative should we look forward to in 2026?

[Ye Guofu, Founder, Chairman, and CEO at MINISO Group]

Thank you. We define 2026 as the elevation year for our proprietary IP, the foundational first steps in the comprehensive organizational restructuring and top-level design of our IP business. We established a dedicated IP business group with full accountabilities from the IP value chain, from creative incubation, to product development, to omni-channel operation.

[Ye Guofu, Founder, Chairman, and CEO at MINISO Group]

Actually, our leader of the merchandise has been placed into the IP business group. We're just using the very experienced people to take lead of the IP business group. Leave us and the most capable people to run the IP business. You can already notice how important IP business will be for MINISO. You can see that in that look, you will see many people are just using new manager to run new business. It's going to be quite risky. We are still remain confident in our new business. We're just using the most capable and most capable payment individuals to run the new business. That's what we do at MINISO. The most capable individual and the capable team are running the new business, IP business, and that business is fully independent and is a new business group business.

[Ye Guofu, Founder, Chairman, and CEO at MINISO Group]

Regarding the team build-out, we have completed a targeted headcount expansion regarding IP operation, product management, creative design. We also established 2 new back-end R&D departments, including CMF, color, material, finish, and ink and color development. We are among a few companies that started to enter into material study. For our trendy toys, we not only do IP, we also do product design and material study, the color study and finish study. We strengthen IP product manufacturing from supply chain, building the product quality, continue to consolidate the foundation for long-term IP growth. That's what we did in H2 of 2025. We have the fabrics and the raw material experts, and we have a CMF, color, material, finish, unit that established in Dongguan, very close to our headquarters. Regarding marketing and communication, we're working to build global IP influencers through a diversified range of applications.

[Ye Guofu, Founder, Chairman, and CEO at MINISO Group]

For example, attending international art fair and fashion week. On the 17th of May, we're going to have the MINISO photo galleries to put into operation in one of the best art centers in Shanghai. That also help to showcase our standing within the artist community will continue to elevate. We're going to have our own photo gallery, not only one in Shanghai, but also a new one in Hong Kong, because Hong Kong is actually the hub for global artists. We're going to build such photo galleries in Hong Kong too. By leveraging those photo gallery, we're going to engage these artists worldwide, continue to ramp up the collaboration, and we're also going to leverage the KOLs to continue to amplify our brand range. Last year for Cathy Cathy Kitty, as well as other international artists, started to work with us for the marketing event.

[Ye Guofu, Founder, Chairman, and CEO at MINISO Group]

Even some of the short videos and the secondary creation has been quite popular. Xiaohongshu, there are many secondary creation content of YuYu. You can also see that even within the secondary integration or content creation, YuYu is actually ranking number 1 among all IPs. The fans are quite active. Certainly, at MINISO, we actually have the IP-specific zones translating the brand impact into actual sales in Guangzhou. We also have the Artist Street that is accounted for 50 sq m GFA. We're going to allow new artists and the new products being shelved in those new Artist Street by having the interactions with the consumer. I believe by so doing we will be able to continue to scale our investment in proprietary IP innovation, create an ecosystem, and backend R&D capacity.

[Ye Guofu, Founder, Chairman, and CEO at MINISO Group]

All investment would work for long-term healthy development of IP, not short-term traffic speculation. We focus on building high-quality IP that accumulates enduring brand value and generates sustainable cash flow, cementing a robust second growth curve for the company's long-term future. That's the strategy we have now. In the near future, as we continue to improve our business capacity, we're going to have new IP and new strategies to truly unlock the value of IP.

[Operator]

Coming next, let's welcome Anne from Jefferies, please.

[Anne Ling, Managing Director at Jefferies]

Thank you, Mr. Ye. Thank you very much. I have a question for your SSSG. What is the current SSSG same-store sales performance? What about the store expansion or site selection, and also the operating margin level in different markets, especially in the directly operated stores in overseas? In the past, you are still in the investment stage.

[Anne Ling, Managing Director at Jefferies]

When can we expect the operating return improvement. Thank you.

[Eason Jingjing Zhang, CFO at MINISO Group]

Thank you. I'm Eason. Let me help to respond to your question then. I think for the past 12 months, our growth philosophy is getting more clear. Same-store sales growth as a foundation and new store expansion, especially high-quality ones as incremental upsides. Those are working in tandem. For the SSSG, our 2026 is to deliver a positive SSSG globally. It's quite challenging. However, we have ways to make it happen because, in international markets, we still have some agent stores. It's not easy to make their growth positive. However, with good assortment, we have every confidence that we'll be able to have it happen. Regarding store expansion, I have already mentioned a net increase of 510-550 high-quality stores globally with China and international markets serving as twin engines for growth.

[Eason Jingjing Zhang, CFO at MINISO Group]

In China, we plan to net add 420 stores. Majority of them would be the land format and the large format stores. We're also going to close down underperforming stores and continue to optimize existing portfolio. In 2026, besides the same-store sales growth, the high-quality new stores opened in 2025 and 2026 will contribute to MINISO in sequential years as they mature. In China, we're still going to harvest a good growth. Net store growth only needs 420. From the international market, net store growth would be 250 stores covering North America, Europe, Southeast Asia, and Latin America. We deploy a combination of land format flagship stores plus high-quality standard stores in prime retail destinations. As Mr. Ye mentioned, we need to move into the world-class business street to improve the brand potential.

[Eason Jingjing Zhang, CFO at MINISO Group]

Regarding North America, the same-store growth is already clearly exceeding 20% in January, February of this year. We will accelerate store openings in 2026. OPM expected to have a low single-digit improvement. In Europe, since the start of 2026, we see SSG grow by double digits. Store expansion is progressing steadily. For example, in Poland, we opened 2 stores, which is quite efficient, working on trendy toys only, that is making lucrative profits. In Europe, we have another 4 direct operating markets. Those are still in the early stage investment. We hope its OPM could be improved further. In Mexico, since the start of 2026, we will see SSG growth being a positive number, and we believe Mexico with agent model is still providing a simple operating profit margin. Southeast Asia, we see some challenge. However, for MINISO, our business model is globalization.

[Eason Jingjing Zhang, CFO at MINISO Group]

No matter some markets being challenged, we would be able to have our global expansion to diversify our investment portfolio. Despite some challenges in Southeast Asia, however, we're going to return to positive for SSG, working on Indonesia premier locations to have new stores. Overall speaking, that SSG and OPM trajectory across all key markets still remain healthy, which can also help to showcase we are still in the fast expansion and growth period. For the key driver, there are four: optimizing store product operating, store expansion, and fourthly, we should also well maintain the cost and expenses. Thank you.

[Operator]

Thank you, Anne. Next question. Let's welcome Madame Xu from CITIC, please.

[Analyst at CITIC Securities]

Thank you, Mr. Ye and the management team. I have a question regarding Southeast Asia market. Southeast Asia market is the first start for international expansion. In 2025, I made a visit to Southeast Asia.

[Analyst at CITIC Securities]

The performance of the Southeast Asia market is of concern to investors. What would be the inventory of the Southeast Asia market? Are you going to adjust operations and the product strategy there in 2026?

[Ye Guofu, Founder, Chairman, and CEO at MINISO Group]

Thank you. Regarding the question for Southeast Asia market, I think in 2026, there will be a huge adjustment. MINISO started our global expansion for 10 years. We made major investment in Mainland China. In 2026, we're going to adjust the 4 key markets: Thailand, Malaysia, Philippines, and Indonesia. In Thailand, we have been quite successful and the land format stores deliver incredible results. Indonesia is going to copy the Chinese model. Southeast Asia is quite close to China, and their consumption pattern is very much impacted by China. The lesson and success we made from China can help guarantee success in Southeast Asia.

[Ye Guofu, Founder, Chairman, and CEO at MINISO Group]

Recently, we went to Malaysia to have a MINISO LAND store with very nice performance. In 2026, we're going to continue to copy what we do in China to the key market in Southeast Asia. I believe after the 2026 adjustment in H1, then in H2, Southeast Asia going to provide you a good turn around. We have a very clear strategy and a very transparent strategy. We're going to make the execution right.

[Analyst at CITIC Securities]

Thank you, Mr. Ye. No further question from me.

[Operator]

Okay. We're going to accommodate the final question. [Qin Yihao] from Yangtze Securities, please.

[Qin Yihao, Analyst at Yangtze Securities]

Thank you. Thanks for the team. Mr. Ye and the management team, I'm [Qin Yihao] from Yangtze River Securities. I have a question to you regarding store renovation and upgrade program. Is it possible for you to tell us what would be the strategy for 2026?

[Qin Yihao, Analyst at Yangtze Securities]

How many stores do you expect to renovate in 2026? What's the result from the completed renovations so far?

[Ye Guofu, Founder, Chairman, and CEO at MINISO Group]

Thank you very much. In 2025, we completed renovation for 290 stores. The result was highly impressive. Renovated store average sales uplifted by 40%-50%. The improvement is not attributable to a single factor, but rather than a simultaneous improvement on foot traffic, conversion rate, and ASP. They are all being improved, but at the same time, rent as a percentage to the sales has declined meaningfully. Store profitability and the sales per square meter rising significantly. Single store profitability is improved, too. More importantly, you can see last year, MINISO LAND has been getting popular. We also get greater support from the landowner. They're happy to provide better locations and larger locations to allow us to have the MINISO LAND stores and the larger format.

[Ye Guofu, Founder, Chairman, and CEO at MINISO Group]

With primary location, the cheaper rent is being provided. In 2026, with our proprietary IP development, some of the shopping malls and department stores are happy to present the best location for us to do aesthetic IP exposure and the IP presence that can really showcase how we scale the resources we would be. In 2026, we're going to accelerate renovation and adjustment. Underperforming stores will be upgraded and be changed to the primary location. 2026 is a year for accelerated renovation. I have already mentioned in the near future, 80% of the stores need to be renovated and upgraded. With our proprietary IP development, in the near future, our stores are going to be quite unique, quite differentiated, and they're all going to be more influential in the landlords' minds and be able to get a good leasing term.

[Ye Guofu, Founder, Chairman, and CEO at MINISO Group]

In that way, I believe they are also going to contribute to our business growth and profitability in China.

[Qin Yihao, Analyst at Yangtze Securities]

Thank you.

[Ye Guofu, Founder, Chairman, and CEO at MINISO Group]

Thanks for all the investors and the analysts for your time for this conference. If you have any further questions, please reach out to the IR team. Thanks for your attention and support to MINISO Group. See you next quarter. Thank you.

Participants

Executives

• Eason Jingjing Zhang, CFO
• Ye Guofu, Founder, Chairman, and CEO

Analysts

• Anne Ling, Managing Director at Jefferies
• Michelle Cheng, Analyst at Goldman Sachs
• Qin Yihao, Analyst at Yangtze Securities
• Runbo Yang, Analyst at CICC
• Samuel Wang, Research Analyst at UBS
• Shi Di, Analyst at Huatai Securities
• Analyst at CITIC Securities