Chagee Holdings Limited Unsponsored ADR ((CHA)) has held its Q3 earnings call. Read on for the main highlights of the call.
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Chagee Holdings Limited’s recent earnings call revealed a mixed sentiment, reflecting both progress and challenges. The company demonstrated significant advancements in overseas expansion and product innovation, yet faced hurdles with declining revenue and same-store sales GMV. Despite these challenges, Chagee’s robust financial position and the announcement of a special dividend signal confidence, although the notable declines in key revenue metrics warrant caution.
Overseas Market Expansion
Chagee Holdings Limited has made impressive strides in its overseas market expansion, successfully entering the Philippines and Vietnam. The company added 54 new stores overseas, contributing to a total of 262 stores as of September 30, 2025. This expansion resulted in a remarkable 75.3% year-over-year increase in overseas GMV, with a 27.7% rise quarter-over-quarter.
Product Innovation and Awards
Chagee’s commitment to product innovation was highlighted by the recognition of its BOYA Jasmine Green milk tea, which won the ‘Best in Nature or Organic Beverage’ title at the 2025 World Beverage Innovation Awards. Additionally, the low caffeine Jasmine Green Tea Latte emerged as a top 3 best seller, significantly boosting user acquisition.
Strong Financial Position
The company concluded the quarter with a strong financial standing, holding RMB 9,142 million in cash and cash equivalents. This robust balance sheet enabled the Board to approve a special cash dividend of USD 0.92 per share, amounting to approximately USD 177 million, reflecting confidence in the company’s financial health.
Expansion of Global Teahouse Network
Chagee continued to expand its global teahouse network, reaching a total of 7,338 locations, with a net addition of 300 teahouses in the third quarter of 2025. This expansion underscores the company’s strategic focus on broadening its global footprint.
Revenue Decline
Despite the positive developments, Chagee experienced a decline in total net revenue, which decreased by 9.4% year-over-year to RMB 3,208.3 million, and a 3.7% sequential decline. This decrease highlights the challenges the company faces in maintaining revenue growth.
Same-Store Sales GMV Decline
The company reported a significant decline in same-store sales GMV, with a 27.9% drop domestically and a 23.4% decline overseas. This was attributed to a high base from the previous year and intensified competition in the market.
Decreased Gross Merchandise Volume (GMV) in Greater China
Chagee’s total GMV in Greater China saw a year-over-year decrease of 6.2%, amounting to RMB 7,629.2 million. This decline further emphasizes the challenges faced in the domestic market.
Forward-Looking Guidance
During the earnings call, CFO Aaron Huang highlighted several strategic achievements and financial metrics. Despite a decrease in same-store sales GMV, the overseas markets showed substantial progress with a 75.3% year-over-year GMV increase. The company’s gross margin improved to 53.8%, and it ended the quarter with substantial cash reserves. While the company refrained from providing formal financial guidance, it emphasized a focus on long-term strategic growth through product innovation and operational efficiency.
In summary, Chagee Holdings Limited’s earnings call presented a balanced view of progress and challenges. The company’s overseas expansion and product innovation are promising, yet declining revenue and same-store sales GMV indicate areas of concern. Chagee’s strong financial position and special dividend reflect confidence, but caution is advised given the significant declines in key revenue metrics.