MINISO reports revenue growth amid declining adjusted profits and strategic shifts

MINISO (09896.HK) reported its 2026 interim results, showing a revenue increase of 22.4% to 11.499 billion yuan, but facing significant challenges in profitability and stock performance. The company's adjusted net profit fell 15.7% year-on-year to 1.079 billion yuan, marking its first decline in this metric since 2022.

Profitability has been heavily influenced by non-operational investments. Specifically, investments in the AI company MiniMax and Yonghui Superstores contributed over 330 million yuan to the net profit. However, volatility in the fair value of AI-related investments led to a net loss of 292 million yuan in the second quarter.

The company is undergoing a strategic shift from a high-margin franchise and agency model toward a direct-operated overseas model. While this has increased revenue, it has also raised costs for rent, IP licensing, and labor, leading to a compression of adjusted net profit margins from 13.2% to 10.6%. Additionally, overseas inventory turnover has slowed significantly, reaching 273 days compared to 97 days for the group average, indicating slower sales velocity in international markets.