Education
About Us
Working with TipRanks
Follow Us
Luckin Coffee Inc (LKNCY)
OTHER OTC:LKNCY
Top Page
Luckin Coffee
(OTC:LKNCY)
Select Model
Select Model
Rating:66Neutral
Price Target:
$36.00
▲(7.40% Upside)
Action:DowngradedDate:12/30/25
Overall score is driven by solid fundamental performance (profitable scaling, improving operating cash flow, and manageable leverage) and a strong growth-focused earnings update, partially offset by weak technical momentum and margin/FCF volatility risks.
Positive Factors
Revenue Growth
Strong revenue growth indicates robust market demand and effective business strategies, supporting long-term financial stability and expansion.
Store Expansion
The significant expansion of store locations enhances market presence and accessibility, driving future revenue growth and competitive positioning.
Cash Flow Generation
Strong cash flow generation supports reinvestment, debt servicing, and strategic initiatives, ensuring financial flexibility and growth potential.
Negative Factors
Rising Coffee Bean Costs
Increased raw material costs could pressure profit margins, necessitating careful cost management to maintain profitability.
Increased Expenses
Rising operational expenses may strain profit margins and require efficiency improvements to sustain financial performance.
Competitive Pressure
Emerging competitors in the beverage market may challenge market share, necessitating strategic investments in brand and marketing.
Luckin Coffee (LKNCY) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$9.55B
Dividend YieldN/A
Average Volume (3M)2.09M
Price to Earnings (P/E)21.9
Beta (1Y)0.34
Revenue Growth44.43%
EPS Growth62.05%
CountryUS
Employees33,795
SectorConsumer Cyclical
Sector Strength84
IndustryRestaurants
Share Statistics
EPS (TTM)0.03
Shares Outstanding266,231,500
10 Day Avg. Volume2,283,584
30 Day Avg. Volume2,092,252
Financial Highlights & Ratios
PEG Ratio7.49
Price to Book (P/B)4.57
Price to Sales (P/S)1.71
P/FCF Ratio30.96
Enterprise Value/Market Cap9.01
Enterprise Value/Revenue2.10
Enterprise Value/Gross Profit3.65
Enterprise Value/Ebitda13.23
Forecast
1Y Price Target
$44.00Price Target Upside31.26% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering1
EPS Forecast (FY)1.95
Revenue Forecast (FY)$59.20B
Luckin Coffee Business Overview & Revenue Model
Company DescriptionLuckin Coffee Inc. engages in the retail services of freshly brewed coffee and non-coffee drinks in the People's Republic of China. It also offers hot and iced freshly brewed coffee, such as Americano, Latte, Cappuccino, Macchiato, Flat White, and Mocha, as well as specialty coffee based on market and seasonal trends; coconut milk latte products; tea drinks; pre-made beverages; and pre-made food items, such as pastries, sandwiches, and snacks. In addition, the company offers cups, tote bags, and other merchandises. It operates pick-up stores, relax stores, and delivery kitchens under the Luckin brand, as well as Luckin mobile app, Weixin mini-program, and other third-party platforms for third-party payment channels. Further, the company provides technical and consultation services; and manufactures materials for products. As of December 31, 2021, it operated 4,397 self-operated stores; 1,627 partnership stores; and 1,102 Luckin Coffee EXPRESS machines. Luckin Coffee Inc. was incorporated in 2017 and is headquartered in Xiamen, the People's Republic of China.
How the Company Makes MoneyLuckin Coffee generates revenue primarily through the sale of coffee and other beverages. The company's revenue model is centered around its mobile app, which streamlines the customer experience by allowing users to order and pay for products in advance, reducing wait times and enhancing convenience. A significant portion of its income comes from its extensive network of self-operated stores and pick-up locations, where customers can quickly collect their orders. Additionally, Luckin Coffee has formed partnerships with third-party delivery services to extend its reach and cater to the growing demand for food delivery in urban areas. The company's focus on cost control, competitive pricing, and aggressive expansion strategy has contributed to its ability to capture a substantial share of the Chinese coffee market. Furthermore, Luckin Coffee occasionally engages in marketing promotions and discounts to attract new customers and increase sales volume, which also contributes to its revenue streams.
Luckin Coffee Earnings Call Summary
Earnings Call Date:Feb 26, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:May 05, 2026
Earnings Call Sentiment Positive
The call emphasized strong full-year growth across revenue, profits, customer additions and store expansion, supported by a materially improved cash position and validated international pilots. However, management flagged near-term headwinds: Q4 same-store sales moderation, notable quarterly margin contraction, and sharply higher delivery and operating expenses driven by changing subsidy dynamics. Management frames these as expected, short-term effects and reiterated a scale-focused, disciplined growth strategy with continued product innovation and digital/AI investments. On balance, the company delivered sizable structural gains while acknowledging temporary profitability pressure and market volatility.Q4-2025 Updates
Positive Updates
Strong Full-Year Revenue and Profit Growth
Total net revenues increased 43% year-over-year to RMB 49.3 billion for FY2025. GAAP operating profit rose 42% to ~RMB 5.1 billion (operating margin 10.3%). Non-GAAP operating profit increased 43% to ~RMB 5.6 billion (non-GAAP margin 11.5%). Net profit grew 22% to RMB 3.6 billion (net margin 7.3%); non-GAAP net profit up 27% to RMB 4.2 billion (non-GAAP net margin 8.5%).
Quarterly Revenue and GMV Expansion
Q4 total net revenue increased 33% year-over-year to RMB 12.8 billion. Gross merchandise value (GMV) grew 33% year-over-year to RMB 14.8 billion, driven by higher cup volumes and store expansion.
Large-Scale Store Expansion and Milestones
Reached total store count of 31,048 by Q4 (domestic 30,888). Added 1,792 net new stores in China in the quarter. Surpassed 20,000 self-operated stores (20,144 self-operated), becoming the first food & beverage chain in China to do so — reinforcing scale and coverage.
Material Customer and Volume Gains
Added over 110 million new transacting customers during the year, bringing cumulative transacting customers to over 450 million. Annual sales of freshly brewed beverages rose 39% year-over-year to 4.1 billion cups. Average monthly transacting customers grew 26% year-over-year to over 98 million and exceeded 100 million for five consecutive months (June–October).
Improved Cash Position and Cash Generation
Generated ~RMB 565 million in net operating cash in Q4. Year-end total cash position improved to ~RMB 9.0 billion versus RMB 5.9 billion at end-2024, providing flexibility for disciplined expansion.
Product Innovation and Portfolio Diversification
Launched ~30 new freshly brewed beverages and ~12 snack items in Q4; over 140 new product launches in 2025. Expanded non-coffee portfolio such that non-coffee beverages accounted for more than 20% of total cups for FY2025, and introduced origin-focused premium offerings and dark-roast options.
Progress on International Expansion
Overseas store count reached 160 (added 42 net new in Q4). Singapore business (~81 self-operated stores) validated with stable store-level profitability; Malaysia franchise footprint at 70 stores with initial targets met. U.S. expansion in early stages with 9 stores opened as part of a disciplined, long-term strategy.
Negative Updates
Q4 Same-Store Sales Moderation
Same-store sales for self-operated stores moderated to +1.2% in Q4 (contrast to FY2025 same-store sales growth of 7.5%), reflecting seasonality, changing food-delivery subsidy dynamics and cup-mix shifts.
Quarterly Margin Contraction and Weaker Profitability
Q4 GAAP operating profit declined to RMB 821 million (operating margin 6.4%) from RMB 1.0 billion (10.5%) year-ago. Q4 net profit was RMB 580 million (net margin 4.1%) versus RMB 851 million (8.8%) prior year. Non-GAAP Q4 operating and net margins were also lower versus prior-year periods, indicating near-term pressure on profitability.
Surge in Delivery Expenses
Delivery expenses increased 94% year-over-year to RMB 1.6 billion, raising delivery expense as a percentage of total net revenue to 13% from 9% in prior year. Management noted delivery order mix declined sequentially as food delivery platforms reduced subsidies during the off-peak season.
Higher Operating and Sales-Related Costs
Absolute operating costs rose with cost of materials up 33% to RMB 5.1 billion (stable at ~40% of revenue), store rental & operating costs stable at ~25% of revenue, sales expenses up 33% to RMB 3.2 billion, sales & marketing up 32% to RMB 756 million, and G&A up 33% to RMB 846 million—pressuring short-term margins.
Near-Term Market Volatility and Subsidy Base Risk
Company highlighted potential near-term volatility for same-store sales and profitability in 2026 due to evolving subsidy dynamics from food delivery platforms and a high 2025 subsidy-driven base, implying short-term comparisons and execution risks.
Company Guidance
Guidance for 2026 is to continue a disciplined, agile, scale-focused expansion while protecting healthy profitability — with management reiterating market‑share growth as the top priority, a focus on stores, costs and pricing, and an expectation of near‑term volatility in same‑store sales and margins as food‑delivery subsidies normalize and 2025’s high base rolls off. They plan to “maintain an industry‑leading pace” of openings and tightly monitor store ramp‑up and maturation, building on 2025 results (total net revenue RMB49.3bn, +43% YoY; GAAP operating profit RMB5.1bn, +42%, 10.3% margin; non‑GAAP operating profit RMB5.6bn, 11.5% margin; net profit RMB3.6bn, 7.3% margin; year‑end cash ~RMB9.0bn). Operational anchors cited to drive growth include the 31,048 stores network (30,888 domestic: 20,144 self‑operated, 10,744 partnership; +1,792 net China stores in Q4), international rollout (160 overseas stores: 81 SG, 9 US, 70 MY), a customer base of >450m cumulative (≈110m new transactors in 2025; average monthly transacting users >98m and >100m for five months), 4.1bn freshly brewed cups (+39%) and >20% of cups from non‑coffee items. Management also flagged delivery dynamics as a margin headwind to watch (delivery expense up 94% to RMB1.6bn, 13% of revenue in Q4) but said continued product innovation, broader pricing architecture, digital/AI efficiency gains and tighter cost management will underpin longer‑term same‑store sales recovery and margin improvement.Luckin Coffee Financial Statement Overview
Summary
Strong multi-year turnaround with accelerating 2024 revenue growth, solid gross/EBITDA margins, improving operating cash flow, and moderate leverage. Score is held back by the 2024 net margin step-down and historically volatile/free-cash-flow conversion.Income Statement
Revenue growth accelerated in 2024 (up 10.551 vs. 0.873 in 2023), showing continued store-level and demand momentum. Profitability is solid with a 2024 gross margin of ~55.6% and EBITDA margin of ~20.9%, but net margin stepped down to ~8.5% from ~11.4% in 2023, indicating higher operating costs, reinvestment, or other below-the-line pressure. Longer-term, results show a strong turnaround from deep losses in 2019–2020 to sustained profitability since 2021, though margins remain somewhat volatile year to year.78
Positive
Balance Sheet
Leverage looks manageable: 2024 debt-to-equity is ~0.46, improved from ~0.61 in 2023 and far better than the highly levered profile seen in 2020–2021 (~1.13). Equity has expanded meaningfully (to ~13.1B in 2024 from ~8.1B in 2023), supporting balance-sheet resilience. Return on equity remains attractive (~22.8% in 2024), though it moderated from a very high 2023 level (~35.0%), suggesting profitability is still normalizing as the company scales.74
Positive
Cash Flow
Operating cash flow is strong and improving (about 4.23B in 2024 vs. 2.90B in 2023), supporting the quality of earnings. However, free cash flow is more uneven: it improved versus 2023 (about 1.93B vs. 0.14B), yet the reported free-cash-flow growth rate is sharply negative in 2024 and historical cash generation has been volatile (including materially negative free cash flow in 2022). Cash conversion also remains mixed, with free cash flow running at ~46% of 2024 net income, implying meaningful reinvestment needs and/or working-capital swings.62
Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 40.92B | 34.96B | 24.90B | 13.53B | 7.86B | 3.81B |
| Gross Profit | 23.56B | 19.44B | 13.40B | 7.86B | 4.25B | 1.47B |
| EBITDA | 6.51B | 7.32B | 5.11B | 2.44B | 1.67B | -5.33B |
| Net Income | 3.90B | 2.97B | 2.85B | 496.82M | 571.05M | -5.28B |
Balance Sheet | ||||||
| Total Assets | 27.00B | 23.10B | 18.29B | 10.48B | 12.31B | 9.32B |
| Cash, Cash Equivalents and Short-Term Investments | 7.41B | 5.74B | 3.49B | 3.53B | 6.48B | 5.06B |
| Total Debt | 6.17B | 6.01B | 4.97B | 1.91B | 4.10B | 3.00B |
| Total Liabilities | 13.44B | 10.05B | 10.16B | 5.43B | 8.68B | 6.60B |
| Stockholders Equity | 13.56B | 13.05B | 8.14B | 5.05B | 5.15B | 2.66B |
Cash Flow | ||||||
| Free Cash Flow | 4.10B | 1.93B | 143.73M | -781.20M | -49.77M | -3.20B |
| Operating Cash Flow | 6.40B | 4.23B | 2.90B | 19.82M | 123.45M | -2.38B |
| Investing Cash Flow | -5.69B | -3.21B | -3.45B | -798.05M | 337.00K | -1.71B |
| Financing Cash Flow | -300.00M | 333.60M | 0.00 | -2.28B | 1.51B | 4.03B |
Luckin Coffee Technical Analysis
Negative
33.52
Price Trends
35.00
Negative
36.56
Negative
36.66
Negative
Market Momentum
0.07
Positive
37.90
Neutral
21.82
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For LKNCY, the sentiment is Negative. The current price of 33.52 is below the 20-day moving average (MA) of 36.84, below the 50-day MA of 35.00, and below the 200-day MA of 36.66, indicating a bearish trend. The MACD of 0.07 indicates Positive momentum. The RSI at 37.90 is Neutral, neither overbought nor oversold. The STOCH value of 21.82 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for LKNCY.
Luckin Coffee Risk Analysis
Luckin Coffee disclosed 108 risk factors in its most recent earnings report. Luckin Coffee reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Luckin Coffee Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
66 Neutral | $9.55B | 21.86 | 23.43% | ― | 44.43% | 62.05% | |
65 Neutral | $8.73B | 96.10 | 13.11% | ― | 28.93% | 69.59% | |
64 Neutral | $8.97B | 109.16 | 8.64% | ― | 23.93% | 153.50% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
59 Neutral | $110.68B | 83.00 | ― | 2.88% | 2.80% | -50.71% | |
52 Neutral | $758.11M | 48.41 | 0.83% | ― | 17.27% | -76.53% | |
44 Neutral | $567.54M | -5.97 | -33.42% | ― | 2.43% | -23.25% |
* Consumer Cyclical Sector Average
LKNCY
Luckin Coffee
34.76
5.19
17.55%
SBUX
Starbucks
97.15
-11.54
-10.62%
BROS
Dutch Bros Inc
52.70
-17.89
-25.34%
FWRG
First Watch Restaurant Group
11.96
-7.25
-37.74%
SG
Sweetgreen
5.53
-17.48
-75.97%
CAVA
CAVA Group, Inc.
79.52
-7.24
-8.34%
Luckin Coffee Corporate Events
Luckin Coffee Reports Strong Q3 2025 Financial Growth
Nov 17, 2025
Luckin Coffee reported a robust financial performance for the third quarter of 2025, with net revenues increasing by 50.2% year-over-year to RMB15.3 billion. The company achieved a record high of 112.3 million average monthly transacting customers and expanded its store network significantly, ending the quarter with 29,214 stores. This growth was driven by a substantial increase in both self-operated and partnership store revenues, alongside a notable rise in delivery volumes. Despite a decrease in operating margins compared to the previous year, the company’s strategic focus on scale and customer demand has reinforced its market leadership.
The most recent analyst rating on (LKNCY) stock is a Buy with a $52.00 price target. To see the full list of analyst forecasts on Luckin Coffee stock, see the LKNCY Stock Forecast page.
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.