Pou Sheng International (3813) Q3 2025 earnings summary

Executive summary

• Revenue for the nine months ended September 30, 2025, declined 7.7% year-over-year to RMB 12,903 million, with gross profit down 9.2% and operating profit down 41.6%, mainly due to subdued consumer confidence and high industry inventory levels.

• Net profit attributable to owners dropped 50.1% year-over-year to RMB 171 million, reflecting operating deleverage and weak offline retail performance.

• Online sales reached a record 33% of total sales, up 13% year-over-year, with livestreaming sales more than doubling and omni-channel capabilities partially offsetting offline pressure.

• Store network rationalization continued, with directly operated stores down 3.5% year-over-year.

• Maintained a strong financial position with a robust net cash position despite challenging market conditions.

Financial highlights

• Gross profit was RMB 4,320.1 million, down 9.2% year-over-year, and gross profit margin for 9M25 was 33.5%, down 0.5 percentage points.

• Operating profit declined 41.5% to RMB 300.3 million, with operating profit margin falling to 2.3% from 3.7%.

• EBITDA decreased 22.1% year-over-year to RMB 1,080.8 million.

• Net cash position at period end was RMB 1,990.8 million, down 27.1% year-over-year.

• Free cash flow for 9M25 was RMB 39.1 million.

Outlook and guidance

• Focus remains on omni-channel integration, digital transformation, and enhancing membership operations, with ongoing investment in omni-channel capabilities.

• Strategic alliances with brand partners and scaling up new brands are key priorities for future growth.

• Targeting continuous improvement in profitability and shareholder returns.

• Continued focus on dynamic inventory management, expense controls, and organizational adjustments to navigate market headwinds.