In the third quarter of 2025, MINISO delivered a report card that mixed highlights with challenges: quarterly revenue topped the RMB 5 billion mark for the first time (RMB 5.756 billion, ≈ USD 0.799 billion, using 1 USD ≈ RMB 7.20), and its global store count crossed the 8,000-store milestone. Overseas markets and the trendy-toy business became dual growth engines. However, behind the strong revenue growth, the “higher revenue without higher profit” dilemma—net profit attributable to the parent fell by more than 30% year on year—and the cost pressure brought by strategic transformation show that this retail giant is undergoing a crucial contest between scale expansion and quality improvement.
Record Highs in Revenue and Store Count
In Q3 2025, MINISO achieved revenue of RMB 5.756 billion (≈ USD 0.799 billion), up 28.2% year on year, exceeding the upper bound of its prior guidance. Store expansion was likewise rapid, with a net increase of 718 stores in the quarter, bringing the total to 8,138, of which overseas markets contributed 488 net new stores and became the core driver of expansion. By business line, the core MINISO brand contributed 90.1% of revenue, reaching RMB 5.2215 billion (≈ USD 0.725 billion), up 22.9% year on year. In the domestic market, revenue was RMB 2.9092 billion (≈ USD 0.404 billion), up 19.3% year on year, with growth accelerating versus the previous two quarters; the overseas market performed even better, with revenue of RMB 2.3123 billion (≈ USD 0.321 billion), up 27.7% year on year, while revenue in the U.S. market surged 65% year on year and new member additions doubled. The trendy-toy brand TOP TOY posted explosive growth: Q3 revenue was RMB 570 million (≈ USD 0.079 billion), up 111% year on year, marking accelerated growth for three consecutive quarters, and it has initiated a Hong Kong listing process.
Profitability Faces Multiple Pressures
In contrast to strong revenue growth, profit metrics remained under pressure. Q3 net profit attributable to the parent was RMB 441 million (≈ USD 0.061 billion), down 31.35% year on year, the largest decline in the past year; for the first three quarters, the decline in net profit attributable to the parent widened to 25.68%, while operating profit fell by more than 10% year on year. The drop in profitability stemmed from three factors: first, the proportion of overseas directly operated stores rose, and their margins are lower than those of the franchise model, dragging down overall profitability; second, strategic investment increased, including up-front expenses for store expansion and TOP TOY’s listing preparation; third, the acquisition of Yonghui Superstores brought investment losses and higher interest costs, with Q3 investment losses of RMB 150 million (≈ USD 20.8 million) due to Yonghui’s losses, and financial costs rising significantly year on year. Expense control pressures were pronounced: Q3 selling and distribution expenses were RMB 1.4299 billion (≈ USD 0.199 billion), up 43.5% year on year, far outpacing revenue growth; promotion and advertising, licensing, logistics, and other expenses all posted double-digit increases. Although adjusted operating profit rose 14.8% year on year, the adjusted operating margin still fell 2.1 percentage points year on year, reflecting the efficiency challenges behind scale expansion.
Facing profitability pressure, MINISO has launched a strategic transformation centered on the “large-store strategy, deep IP cultivation, and overseas upgrades,” attempting to shift from “small margins with high turnover” to “higher average ticket” cultural-creative retail.
Large-Store Upgrades to Build Experiential Scenes
MINISO introduced a “vacate-and-replace” strategy, planning to close and reopen nearly 6,510 stores over the next two years. Small and medium-sized stores will be upgraded into 400–600 ㎡ themed spaces, and flagship stores will reference the 1,500 ㎡ MINISO LAND Global No. 1 store on Shanghai’s Nanjing Road, creating immersive experiential scenes. As of the end of Q3, 17 MINISO LAND stores had opened in core cities in China, and the first overseas store opened at Siam Square in Bangkok.
Through scene-based layouts, the large-store model lifts average ticket size and sales per square meter; IP products account for 80%–90% of MINISO LAND, the average ticket is 1.5–3 times that of regular stores, and the operating margin is 25%–30%, significantly higher than that of regular stores.
Dual-Track IP Operations
On the product side, MINISO is accelerating its shift toward IP cultural-creative goods, planning to raise the share of IP co-branded merchandise from 50% to above 80%, reducing reliance on low-priced standard items. On one hand, it is deepening cooperation with top international IPs such as Disney and Marvel to launch high-margin blind boxes and limited trendy-toy lines; on the other hand, it is stepping up incubation of self-owned IPs, taking control of Hi TOY (Haichuang Culture) and acquiring three major IPs including “Nommi Nuomier,” while signing nine trendy-toy artists. At present, “Nommi Nuomier” is scaling rapidly, improving TOP TOY’s gross margin; the growth rate of IP licensing fees has fallen below the growth rate of revenue, suggesting the strategy is beginning to bear fruit.
Overseas Markets: Improving Quality and Efficiency
The overseas strategy is shifting from pure scale expansion to a balance among “quality, scale, and brand.” In mature markets in Europe and the U.S., direct operation is being reinforced; in the U.S., a “fixed rent + revenue-sharing” model is being adopted to optimize costs, and the share of localized procurement is being raised to offset tariffs; in emerging markets, a “direct-operation partnership” model is being promoted to reduce risk. As of the end of Q3, the number of overseas directly operated stores rose from 422 to 637, direct-store revenue grew 69.9%, and the overseas revenue share reached 44.3%, approaching parity with the domestic business.
Market Response and Future Challenges
MINISO’s transformation still faces multiple challenges: first, franchisees must bear the costs of store upgrades, testing their operational capabilities; second, the brand’s cognitive shift from value retail to IP cultural-creative goods requires consumer acceptance; third, TOP TOY’s market share remains below the industry leader’s, and reliance on external IP faces risks of higher costs and homogenization; fourth, the incubation cycle for self-owned IPs is long and uncertain.
Even so, the company has core advantages: RMB 7.77 billion in cash reserves (≈ USD 10.79 billion), healthy operating cash flow, a global supply-chain network, and the potential spin-off listing of TOP TOY. As overseas direct-operation margins improve, the large-store model is implemented, and self-owned IPs scale up, profitability pressure is expected to ease. The next two years will be a critical period for strategic transformation; balancing value-for-money and IP innovation, scale and profitability, and the interests of headquarters and franchisees will determine whether MINISO can successfully transform into a leading global IP operations platform.
[Disclaimer]: The above content reflects analysis of publicly available information, expert insights, and BCC research. It does not constitute investment advice. BCC is not responsible for any losses resulting from reliance on the views expressed herein. Investors should exercise caution.