Hong Kong-listed new-style tea beverage companies deliver impressive performance and accelerate their expansion into the lower-tier markets

Securities Times reporter Wang Jun

In 2025, under the dual forces of competition for market share amid a saturated market and consumption upgrading, the new-style tea beverage industry turned in a bright set of annual report results.

Recently, Hong Kong-listed companies such as Mixue Group, Happy Lemon (Shanghai), and Gu Ming have successively released their 2025 annual reports, while Toast 100 also issued a 2025 performance forecast. Multiple companies achieved double-digit growth in both revenue and net profit. Mixue Group reported revenue of over 33 billion yuan, with attributable net profit approaching 6 billion yuan, making it the most profitable new tea beverage company.

In 2025, the new tea beverage track saw a dense wave of listings. Gu Ming, Mixue Group, Happy Lemon (Shanghai), and others all went public on the Hong Kong Stock Exchange. Before that, Nayuki’s Tea and Toast 100 were listed on the Hong Kong Stock Exchange in 2021 and 2024, respectively. Against the backdrop of slowing industry growth and intensifying fragmentation among the leading players, how can new-style tea beverages achieve high-quality growth?

Double growth in revenue and net profit

On March 25, the new tea beverage brand Gu Ming released its 2025 annual performance report: total annual revenue of approximately 12.914 billion yuan, up 46.9% year over year; net profit attributable to shareholders of 3.109 billion yuan, up 110.3%.

Previously, Mixue Group and Happy Lemon (Shanghai) also released their 2025 performance reports, with both revenue and net profit likewise seeing substantial increases. Mixue Group’s annual report shows that in 2025, the company achieved revenue of 33.560 billion yuan, up 35.2%; attributable net profit was 5.887 billion yuan, up 32.7%. Happy Lemon (Shanghai) reported that in 2025, operating revenue was 4.466 billion yuan, up 36.0%; attributable net profit was 0.501 billion yuan, up 52.4%.

In today’s increasingly fierce competition in the ready-to-drink tea market, leading brands are continuing to develop with strong growth momentum. Mixue Group stated in its annual report that the company’s performance growth was mainly attributable to increased revenue generated from product and equipment sales, followed by increased revenue generated from franchising and related services. The data show that in 2025, revenue from product and equipment sales was 32.766 billion yuan, up 35.3%; revenue from franchising and related services was 0.794 billion yuan, up 28.0%. “The above increases are mainly attributable to the expansion of the company’s store network.” Mixue Group said in its financial report. The data show that as of December 31, 2025, the company had built a store network of about 60,000 stores worldwide.

Happy Lemon (Shanghai) has three brands under its umbrella: Happy Lemon (Shanghai), Tea Waterfall, and Hey Tea. As of December 31, 2025, the total number of stores was 11,449, up 24.8% from 9,176 stores as of December 31, 2024. Happy Lemon (Shanghai) said that while accelerating expansion, the company follows a “balance of entering and exiting” principle, proactively closing some underperforming stores or stores whose leases have expired, and improving the overall level of brand services and store profitability through optimized layout.

Toast 100 released its performance forecast earlier. In 2025, its adjusted net profit was expected to range from 0.792 billion yuan to 0.852 billion yuan, representing growth of 22.79% to 32.09% year over year. The company believes that the growth in adjusted net profit is mainly benefited from the company’s continued improvement in core operating performance.

Accelerating channel deepening

From the operating strategies of the aforementioned new tea beverage companies, channel deepening has become a key factor for rapid brand dissemination and market penetration.

Mixue Group’s annual report shows that by the end of 2025, the company had a total of more than 53,000 stores in mainland China, of which nearly 42,700 were located in second-tier, third-tier, and lower cities, accounting for over 77%. Compared with 2024, the number of stores in 2025 increased by nearly 13,800, including 11,200 additional stores in second-tier, third-tier, and lower cities. Mixue Group said that its store network in mainland China had covered 31 provinces, more than 300 prefecture-level cities, and all tiers of cities. “The breadth and depth of our store network distinguish the company from other ready-to-drink beverage brands in mainland China.” Mixue Group said in its financial report.

Happy Lemon (Shanghai)’s stores are also mainly concentrated in second-tier, third-tier, and lower cities. As of the end of 2025, the number of stores in second-tier, third-tier, and lower cities reached 8,357, accounting for 73%; compared with the end of 2024, the number of stores at the end of 2025 increased by 2,273, including an increase of 1,764 stores in second-tier, third-tier, and lower cities.

According to a survey by Zhizhi Consulting, the market for ready-to-drink tea beverage stores in China’s third-tier cities and below, measured by total transaction volume of goods, is the largest sub-market and is expected to have the fastest growth rate during 2023 to 2028, with huge growth potential in the future.

An analyst at iiMedia Consulting believes that consumption upgrading in second-tier and third-tier cities is becoming increasingly evident, and operating costs are lower as well. These are turning into the core areas that new tea beverage companies are competing to布局 and an important engine driving industry growth.

How to break through further?

It should be noted that the new tea beverage industry has now moved from the initial stage of rapid expansion and an intense “land grab” for market share into a new stage of inventory competition that emphasizes refined operations.

iiMedia Research data show that in 2024, the market size of China’s new tea beverage sector was 354.72 billion yuan. The market space is gradually becoming saturated. Brands in the industry have entered the inventory competition stage. It is expected that in the coming years, the market size of China’s new tea beverage sector will maintain small but steady growth, and by 2028 it is expected to exceed 400 billion yuan.

Against this backdrop, how to achieve high-quality growth has become a new problem the industry urgently needs to solve. Mixue Group mentioned in its annual report that facing a constantly changing market environment and potential challenges, the company will adhere to its value proposition of “high quality at affordable prices,” and will continuously expand its store network in China to consolidate its leading position in China’s ready-to-drink beverage industry; at the same time, it will further focus on the Southeast Asia market, appropriately expand into other markets, and build a globally influential food and beverage brand with world-class impact.

Happy Lemon (Shanghai) said that it will advance its store expansion strategy in a phased and orderly manner, continuously improving single-store profitability and investment return efficiency; meanwhile, it will closely track consumption trends and industry dynamics, accelerate the pace of laying out the coffee category, innovate consumption scenarios and sales models, and activate diversified consumer demand. In addition, the company will continue to deepen its multi-brand strategy, strengthen cooperation with high-quality suppliers at home and abroad, increase investment in information technology and digitization, and ensure efficient and compliant overall operations.

An analyst at iiMedia Consulting believes that the new tea beverage industry is transforming from “scale expansion” to “value upgrading.” Health and personalization have become core consumer demands. Companies need to respond to consumers’ needs for health and quality through product innovation, forming a precise matching logic of “demand-driven product iteration.” Meanwhile, going overseas has become an important direction for expanding growth boundaries. Not only does it bring new growth opportunities for companies, it also promotes the global spread of China’s new tea beverage culture.