The 16.1% same-store GMV decline in Greater China signals worsening unit economics despite total revenue growth from store conversions. The $150M buyback (7.9% of market cap) provides a floor but does not reverse the fundamental deterioration. Watch for further franchisee attrition and whether the shift to company-owned stores can stabilize margins over the next two quarters.
Price Chart
Executive Summary
Chagee reported Q1 2026 revenue of RMB3,546M (+4.5% YoY), but operating income fell 33% to RMB547M and GAAP net income dropped 34% to RMB448M, with net income margin compressing from 20.0% to 12.6%. Same-store GMV in Greater China declined 16.1% YoY, the fifth consecutive quarter of negative same-store growth. The board authorized a $150M buyback, but the core business trends remain weak.
Key Facts
- Q1 2026 revenue RMB3,546M vs RMB3,393M YoY (+4.5%)
- Operating income RMB547M vs RMB821M YoY (-33.3%)
- GAAP net income RMB448M vs RMB677M YoY (-33.9%)
- Net income margin 12.6% vs 20.0% YoY
- Non-GAAP net income RMB507M vs RMB677M YoY (-25.2%)
- Same-store GMV growth in Greater China -16.1% YoY (fifth consecutive quarterly decline)
- Franchised teahouse revenue fell 12.9% YoY to RMB2,744M
- Company-owned teahouse revenue surged 230% to RMB802M, driven by store conversion from franchise model
- Total teahouse count 7,531 (+12.7% YoY), but franchised teahouses declined 3.8% QoQ
- Cash & equivalents fell to RMB7,146M from RMB7,892M at Dec 2025 (-9.5%)
- Operating cash flow RMB193M vs RMB360M YoY (-46.3%)
- Board authorized $150M share repurchase program over 12 months
Financial Impact
Operating income decline of ~RMB274M YoY; net income decline of ~RMB230M YoY; net income margin compression of 740bps
Risk Factors
- Continued same-store sales decline in core Greater China market
- Margin compression from shift to higher-cost company-owned store model
- Franchisee network shrinkage (franchised stores down 97 QoQ)
- Cash burn from company-owned store capex and negative operating cash flow trend
- Intense industry competition and economic headwinds in China
Market Snapshot
Investment Themes
Documents Analyzed
This report is based on 5 SEC documents filed with EDGAR.
| Document | Accession Number |
|---|---|
| 6-K Filing (Primary) | 0001104659-26-067770 |
| Document: tm2615738d1_6k.htm | 0001104659-26-067770 |
| Document: 0001104659-26-067770-index-headers.html | 0001104659-26-067770 |
| Document: 0001104659-26-067770-index.html | 0001104659-26-067770 |
| Document: 0001104659-26-067770.txt | 0001104659-26-067770 |
Track record builds as more directional reports settle.
Filters
| Type | Now | ||||
|---|---|---|---|---|---|
Aug 28, 2026 8w ago | 6-K | $10.80 | awaiting T+60 | — | $12.19 (+12.92%) |
Aug 28, 2026 8w ago | Press Release | $10.80 | awaiting T+60 | — | $12.19 (+12.92%) |
Aug 21, 2026 9w ago | Press Release | $10.81 | awaiting T+60 | — | $12.19 (+12.81%) |
May 29, 2026 21w ago | 6-K | $12.76 $10.84 | ▲ +15.05% | ▲ +16.23% | $12.19 (+4.43%) |
May 29, 2026 21w ago | Press Release | $13.19 $10.63 | ▲ +19.41% | ▲ +20.66% | $12.19 (+7.54%) |
May 22, 2026 22w ago | Press Release | $9.54 $10.05 | ▲ +5.35% | ▲ +2.16% | $12.19 (+27.83%) |
Apr 29, 2026 25w ago | Press Release | $10.68 $11.20 | ▲ +4.87% | ▲ +0.76% | $12.19 (+14.19%) |
Mar 31, 2026 30w ago | 6-K | $9.31 $12.14 | ▲ +30.40% | ▲ +18.02% | $12.19 (+30.99%) |
Mar 31, 2026 30w ago | Press Release | $9.31 $12.14 | ▼ −30.40% | ▼ −18.02% | $12.19 (−30.99%) |
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