Luckin Coffee: Luckin Coffee Announces First Quarter 2025 Financial Results

In This Article: First Quarter Same-Store Sales Growth for Self-Operated Stores Notably Improved to 8.1% First Quarter GAAP Operating Margin Expanded Year-over-Year to 8.3% More than 1,750 Net New Store Openings; Ended Quarter with a Total of 24,097 Stores BEIJING, April 29, 2025 (GLOBE NEWSWIRE) -- Luckin Coffee Inc. ("Luckin Coffee" or the "Company") (OTC: LKNCY) today announced its unaudited financial results for the three months ended March 31, 2025. FIRST QUARTER 2025 HIGHLIGHTS 1 Total net revenues were RMB8,865.4 million (US$1,220.7 million), representing a 41.2% year-over-year increase. Net new store openings were 1,757, comprising 1,743 stores in China (including 5 stores in Hong Kong), 6 stores in Singapore and 8 stores in Malaysia. Total number of stores increased to 24,097 at the first quarter end, comprising 15,598 self-operated stores and 8,499 partnership stores, which represented a store unit growth of 7.9% from the total store count as of the end of fourth quarter of 2024. Average monthly transacting customers were 74.3 million, representing a 24.0% year-over-year increase. Revenues from self-operated stores were RMB6,479.5 million (US$892.2 million), representing a 41.5% year-over-year increase. Same-store sales growth for self-operated stores was 8.1%, notably improved from negative 3.4% in the previous quarter, and significantly improved from negative 20.3% in the same quarter of 2024. Store-level operating profit - self-operated stores was RMB1,106.3 million (US$152.3 million), representing a 244.8% year-over-year increase. Store-level operating margin increased by 10.1 percentage points year-over-year to 17.1%. Revenues from partnership stores were RMB2,080.8 million (US$286.5 million), representing a 38.0% year-over-year increase. GAAP operating income was RMB737.2 million (US$101.5 million), significantly improved from GAAP operating loss of RMB65.1 million in the same quarter last year. GAAP operating margin rebounded to 8.3% from negative 1.0% in the same quarter last year. Non-GAAP operating income , which adjusts for share-based compensation expenses, was RMB864.3 million (US$119.0 million), notably increased from RMB5.0 million in the same quarter last year. Non-GAAP operating margin expanded to 9.7% from 0.1% in the same quarter last year. Dr. Jinyi Guo, co-founder and Chief Executive Officer of Luckin Coffee, said, "We delivered strong first quarter results, marked by 41% year-over-year revenue growth and healthy margin improvement as we scaled to over 24,000 stores. Notably, our self-operated stores returned to positive same-store sales growth at 8.1%, reflecting rising customer demand as well as the effectiveness of our development strategy. Capitalizing on China's booming coffee market, we will strategically focus on gaining market share by continuing to offer high-quality products at competitive prices. Backed by our customer-first core values, we strive to strengthen our leadership position through leveraging our scale advantage, high product quality and compelling value proposition, driving long-term sustainable growth." ______________________________ 1 Please refer to the section "KEY DEFINITIONS" for detailed definitions on certain terms used. BOARD LEADERSHIP TRANSITION Dr. Jinyi Guo will cease to be Chairman of the Board of Directors (the "Board") effective today and will continue serving as Chief Executive Officer and a Board member. Concurrently, the Board has approved the appointment of Mr. Hui Li to return as a director of the Company and assume the role of Chairman. Mr. Hui Li is the Chairman and CEO of Centurium Capital, which is the largest shareholder of the Company. The appointment of Mr. Hui Li as Board Chairman reflects the Company's sustained focus on long-term value creation for all stakeholders and will further enhance strategic alignment and governance oversight. Dr. Jinyi Guo stated: "I am very pleased to welcome Mr. Hui Li to rejoin the Board and assume the role of Board Chairman. His experiences in business management will significantly contribute to our growth and strategic development both domestically and globally. I will continue to focus on my Chief Executive Officer and director responsibilities, and I look forward to our continued collaboration in advancing our mission and creating long-term, sustainable value to our shareholders." Mr. Hui Li said: "I am honored to rejoin the Board and take on the role of Chairman at this important time for Luckin Coffee. I want to express my gratitude to Dr. Guo for his exceptional contribution as Chairman and reaffirm our commitment to executing our current strategic initiatives. I look forward to working with Dr. Guo and the broader leadership team to guide the Company's next growth phase." Mr. Li is the Chairman and CEO of Centurium Capital. Mr. Li had previously served as a director of the Company until July 2020. In addition, Mr. Li is also Chairman of the board of directors of Taibang Biological Ltd. Previously, Mr. Li was an executive director and a managing director at Warburg Pincus Asia LLC. Prior to joining Warburg Pincus, Mr. Li worked in the investment banking division of Goldman Sachs and Morgan Stanley. Mr. Li obtained a bachelor's degree majoring in economics from Renmin University of China and a master's degree majoring in business administration from Yale University School of Management. FIRST QUARTER 2025 FINANCIAL RESULTS Total net revenues were RMB8,865.4 million (US$1,220.7 million), representing an increase of 41.2% from RMB6,278.1 million in the same quarter of 2024. Net revenue growth was primarily driven by a 42.0% year-over-year increase in GMV, which reached RMB10.4 billion, as a result of an increase in the number of products sold resulting from growth in (i) the number of stores in operation as well as (ii) monthly transacting customers. Revenues from product sales were RMB6,784.6 million (US$934.2 million), representing an increase of 42.2% from RMB4,770.2 million in the same quarter of 2024. Net revenues from freshly brewed drinks increased to RMB6,162.7 million (US$848.5 million) from RMB4,351.8 million in the same quarter of 2024. This revenue stream accounted for 69.5% of total net revenues, compared to 69.3% in the same quarter of 2024. Net revenues from other products increased to RMB476.8 million (US$65.6 million) from RMB308.1 million in the same quarter of 2024. This revenue stream accounted for 5.4% of total net revenues, compared to 4.9% in the same quarter of 2024. Net revenues from others increased to RMB145.1 million (US$20.0 million) from RMB110.2 million in the same quarter of 2024. This revenue stream accounted for 1.6% of total net revenues, compared to 1.8% in the same quarter of 2024. Revenues from partnership stores were RMB2,080.8 million (US$286.5 million), representing an increase of 38.0% from RMB1,508.0 million in the same quarter of 2024. This revenue stream accounted for 23.5% of total net revenues, compared to 24.0% in the same quarter of 2024. Revenues from partnership stores included sales of materials of RMB1,440.1 million (US$198.3 million), profit sharing and royalty fee of RMB260.1 million (US$35.8 million), delivery service fees of RMB201.7 million (US$27.8 million), sales of equipment of RMB159.7 million (US$22.0 million), and franchise and other service fees of RMB19.2 million (US$2.6 million). Total operating expenses were RMB8,128.2 million (US$1,119.2 million), representing an increase of 28.1% from RMB6,343.3 million in the same quarter of 2024. The increase primarily resulted from the Company's business expansion. Meanwhile, operating expenses as a percentage of total net revenues was 91.7%, markedly lower than 101.0% in the same quarter of 2024. The improvement was mainly due to the decrease of cost of materials as a percentage of total net revenues as a result of the Company's product mix changes and supply chain strength. Cost of materials were RMB3,573.0 million (US$492.0 million), representing an increase of 21.3% from RMB2,944.4 million in the same quarter of 2024. The increase was mainly due to increases in (i) the number of products sold and (ii) sales of materials to partnership stores. Store rental and other operating costs were RMB2,329.1 million (US$320.7 million), representing an increase of 27.0% from RMB1,833.3 million in the same quarter of 2024. The increase mainly resulted from the increased number of stores and items sold which led to year-over-year increases in (i) labor costs, (ii) store rental costs as well as (iii) utilities and other store operating costs. Depreciation and amortization expenses were RMB337.8 million (US$46.5 million), representing an increase of 30.2% from RMB259.4 million in the same quarter of 2024. The increase was mainly due to increases in (i) amortization of leasehold improvements for the stores and (ii) depreciation expenses of additional equipment put into use in new stores. Delivery expenses were RMB689.0 million (US$94.9 million), representing an increase of 53.9% from RMB447.8 million in the same quarter of 2024. The increase was mainly due to the increase in the number of delivery orders. Sales and marketing expenses were RMB496.4 million (US$68.4 million), representing an increase of 52.4% from RMB325.8 million in the same quarter of 2024. The increase was mainly driven by increases in (i) advertising and other promotion expenses, (ii) commissions to third-party food delivery and live streaming platforms. Sales and marketing expenses as a percentage of total net revenues was 5.6%, compared to 5.2% in the same quarter of 2024. General and administrative expenses were RMB681.2 million (US$93.8 million), representing an increase of 22.4% from RMB556.5 million in the same quarter of 2024. The increase was mainly driven by increases in (i) share-based compensation for management and employees, (ii) research and development expenses, and (iii) payroll costs for general and administrative st