China’s leading supermarket chain enterprise, Yonghui Superstores, recently released its semi-annual report showing a more than 20% year-on-year decline in revenue in the first half of this year, with a net loss attributable to the parent company of 2.41 billion yuan, and a non-GAAP net loss expanded to 8.02 billion yuan. Meanwhile, the company closed 227 loss-making stores on a large scale during the strategic transformation process, highlighting the pains of transformation.
According to the financial data released by Yonghui Superstores on August 20th, in the first half of 2025, the company achieved a revenue of 29.948 billion yuan, a decrease of 20.73% compared to the same period last year. The net loss attributable to the parent company was 2.41 billion yuan, and the non-GAAP net loss soared to 8.02 billion yuan.
This marks the fifth consecutive year of losses for Yonghui Superstores since 2021, with accumulated losses exceeding 9.5 billion yuan, deepening the operational challenges.
Financial analysis shows that the significant revenue decline stems from the strategic transformation measures initiated by the company in the second half of 2024. Despite the notable increase in revenue from adjusted stores during the period, it was still insufficient to offset the revenue gap caused by the closure of a large number of stores.
During the reporting period, the company’s comprehensive gross profit margin was 20.80%, a decrease of 0.78 percentage points compared to the same period last year, reflecting the impact of supply chain transformation on short-term profitability.
Of particular note is that the online business revenue of Yonghui Superstores reached 5.49 billion yuan, accounting for 18.33% of total revenue. Although this sector reduced its losses by 34.75 million yuan compared to the previous year, it still remained in an overall loss position. The company’s CFO, Wu Kai, admitted that the profit model of the online channel is “still in the refinement stage.”
On August 21st, Yonghui Superstores held a performance briefing. During the meeting, the company’s CFO, Wu Kai, stated that due to the significant number of stores planned for closure in 2025, the overall revenue is expected to be lower than that of 2024.
Facing the continuing deterioration of the business situation, Yonghui Superstores has adopted a dual strategy of “store closures for streamlining, store upgrades.” The financial report indicates that in the first half of this year, Yonghui Superstores closed 227 loss-making stores, surpassing the 232 tail-end stores closed throughout the previous year.
Yonghui Superstores aims to complete the restructuring of 200 stores nationwide by September 30, 2025, and to complete the restructuring of all stores by 2026.
Yonghui Superstores, known as the “supermarket leader” in China, was once a unique presence in the supermarket industry, with a total of 1,440 stores in 2019. However, it has been continuously operating at a loss since 2021. According to data released by the China Chain Operation Association, in 2024, Yonghui Superstores ranked fourth in sales among supermarkets in China, following Walmart, RT-Mart, and Hema.
Since studying the operating model of Pinduoduo in May 2024, Yonghui Superstores has undergone comprehensive reforms in areas such as restructuring the product supply chain and improving employee benefits. However, the specific operational data related to the adjusted stores in the latest financial report are relatively limited, and the transformation effects still require further observation.
After Miniso, a Chinese retail enterprise, acquired a 29.4% stake in Yonghui Superstores in September last year, Yonghui officially embarked on the path of quality retail transformation. Nevertheless, amid the dual pressures of sluggish consumption in China and the traditional retail industry facing the impact of e-commerce, whether Yonghui Superstores can truly achieve profitability through store adjustments remains to be further tested by the market and time.