TH International (THCH) Q2 2025 earnings summary

Executive summary

• System sales grew 1.4% year-over-year to RMB409.5 million, while total revenues declined 4.9% to RMB349.0 million in Q2 2025 due to planned closures and lower same-store sales.

• Food revenue rose 8.6% year-over-year, reaching a record 35.2% of system sales, driven by new menu launches like the Light & Fit Lunch Box.

• Registered loyalty club members increased 22.4% year-over-year to 26.2 million, with digital orders comprising 90.4% of total orders.

• Franchise network expansion continued, with over 8,100 franchise applications since December 2023 and more than 400 stores converted to the franchisee model.

• Achieved positive adjusted corporate EBITDA and reduced adjusted net losses by 16.2% year-over-year.

Financial highlights

• Revenues from company-owned and operated stores declined 12.5% year-over-year, mainly due to planned closures and a 3.6% decrease in same-store sales.

• Franchised and retail business revenues increased 50.7% year-over-year, with franchised stores growing from 333 to 449 year-over-year.

• Monthly average transacting customers reached 3.59 million in Q2 2025, up 14.3% year-over-year.

• Digital orders hit a record 90.4% of total orders, up from 86.5% a year ago.

• Cash and equivalents stood at RMB178.8 million as of June 30, 2025, down from RMB184.2 million at year-end 2024.

Outlook and guidance

• Targeting around 200 new franchisee store openings in 2025, with a majority as sub-franchisee stores.

• Expecting over 100 net new store openings in 2025 and 200-300 new openings annually in coming years.

• Anticipates positive same-store sales in Q3 and the second half of 2025.

• Approaching full-year adjusted corporate EBITDA breakeven and operating cash flow self-sufficiency.

• Near-term priorities include accelerating franchising, improving adjusted corporate EBITDA margins, and optimizing cost structure.