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TH International (THCH)
NASDAQ:THCH
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TH International (THCH) AI Stock Analysis

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THCH

TH International

(NASDAQ:THCH)

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Neutral 45 (OpenAI - 4o)
Rating:45Neutral
Price Target:
$2.50
▲(4.17% Upside)
TH International's overall stock score is primarily impacted by its weak financial performance, characterized by declining revenues, persistent losses, and a highly leveraged balance sheet. While the earnings call highlighted some positive trends, such as increased food revenue and digital orders, these are overshadowed by the company's financial instability and valuation concerns. Technical analysis suggests limited momentum, further contributing to the cautious outlook.

TH International (THCH) vs. SPDR S&P 500 ETF (SPY)

TH International Business Overview & Revenue Model

Company DescriptionTH International (THCH) is a prominent player in the food and beverage sector, specializing in the development, operation, and franchising of fast-casual dining concepts. The company is best known for its flagship brand, which focuses on providing high-quality, innovative menu options that cater to evolving consumer tastes. THCH operates in various international markets, leveraging its expertise in brand management and restaurant operations to expand its footprint and enhance customer experiences.
How the Company Makes MoneyTH International generates revenue primarily through the franchising of its restaurant brands, where franchisees pay initial franchise fees and ongoing royalties based on their sales. Additionally, the company earns income from corporate-owned restaurant locations, which contribute directly to its sales figures. Significant partnerships with suppliers and distributors also play a vital role in enhancing profitability, as they allow THCH to negotiate favorable terms and reduce costs. Furthermore, the company may benefit from promotional collaborations and marketing agreements that help drive brand awareness and customer traffic to its locations.

TH International Earnings Call Summary

Earnings Call Date:Aug 26, 2025
(Q2-2025)
|
% Change Since: |
Next Earnings Date:Nov 12, 2025
Earnings Call Sentiment Neutral
The earnings call revealed a mix of positive developments and challenges. While the company saw significant growth in food revenue, loyalty memberships, and digital orders, it faced setbacks with decreased company-owned store revenues and increased operational costs such as rental and delivery expenses. There is optimism about the company's ability to improve same-store sales and operational efficiencies moving forward.
Q2-2025 Updates
Positive Updates
Food Revenue Increase
Food revenue increased by 8.6% year over year, and food revenue contribution as a percentage of sales reached a historical high of 35.2%, up from 32.5% in 2024.
Profits from Other Revenues
Profits from other revenues achieved a year-over-year increase of 110.3%.
Expansion of Store Footprint
Expanded store footprint into 98 cities with over 400 stores converted since the launch of the franchisee program in December 2023.
Growth in Loyalty Membership
Registered loyalty club members reached 26.2 million, reflecting a 22.4% year-over-year growth.
Improved Digital Order Metrics
Digital orders as a percentage of total orders rose to 90.4% in Q2 2025, up from 86.5% in Q2 2024.
Reduction in General and Administrative Expenses
General and administrative expenses decreased by 5.2% year over year.
Negative Updates
Decrease in Company-Owned Store Revenues
Company-owned and operated store revenues dropped by 12.5% year over year, primarily due to the planned closure of underperforming stores and a 3.6% decrease in same-store sales growth.
Increase in Rental and Property Management Fees
Rental and property management fees as a percentage of revenues increased by 0.9 percentage points.
Increase in Delivery Costs
Delivery costs rose by 1.8 percentage points to 11.8% in 2025 compared to 10% in 2024 due to a higher delivery revenue mix.
Company Guidance
During TH International Limited's Second Quarter 2025 Earnings Conference Call, the company provided guidance on several key metrics. The company reported a food revenue increase of 8.6% year over year, with food revenue contributing 35.2% of sales, up from 32.5% in 2024. System sales grew by 1.4%, and profits from other revenues surged by 110.3% year over year. The company has returned to positive adjusted corporate EBITDA, reducing adjusted net losses by 16.2%. Store expansion was notable, with the company operating in 98 cities and receiving over 8,100 franchise applications, converting over 400 stores by Q2's end. The registered loyalty club membership grew by 22.4% to 26.2 million members. Despite a 12.5% drop in company-owned store revenues due to strategic closures, franchised business revenues increased by 50.7%. The company improved its store contribution margin and adjusted corporate EBITDA margin by 2.7 and 2.8 percentage points, respectively. They also enhanced digital orders, reaching a record 90.4% of total orders. Looking ahead, TH International Limited aims to open around 200 franchise stores in 2025, focusing on sustainable growth and profitability.

TH International Financial Statement Overview

Summary
TH International is facing significant financial challenges. The income statement shows declining revenues and persistent losses, with negative net profit and EBIT margins. The balance sheet is highly leveraged with negative equity, indicating financial distress. Although there is some improvement in cash flow, the company still faces operational cash deficits. Overall, the financial performance reflects a struggling business with limited financial flexibility.
Income Statement
25
Negative
TH International's income statement reveals significant challenges. The company has experienced declining revenue growth, with a negative growth rate of -1.31% in the TTM period. Profitability metrics are concerning, with a negative net profit margin of -26.37% and a negative EBIT margin of -25.59%. These figures indicate substantial losses and operational inefficiencies. The gross profit margin is relatively low at 16.56%, suggesting limited pricing power or high cost of goods sold. Overall, the income statement reflects a struggling business with declining revenues and persistent losses.
Balance Sheet
20
Very Negative
The balance sheet of TH International shows a precarious financial position. The company has a negative stockholders' equity, resulting in a negative debt-to-equity ratio of -1.90, indicating that liabilities exceed assets. This high leverage poses a significant risk to financial stability. The return on equity is positive at 41.67%, but this is primarily due to the negative equity base rather than operational success. The equity ratio is also negative, further highlighting the company's financial distress. Overall, the balance sheet suggests a highly leveraged company with limited financial flexibility.
Cash Flow
30
Negative
TH International's cash flow statement indicates some improvement, but challenges remain. The free cash flow growth rate is positive at 250.24%, suggesting better cash management compared to previous periods. However, the operating cash flow is negative, and the operating cash flow to net income ratio is -0.03, indicating that the company is not generating sufficient cash from operations to cover its losses. The free cash flow to net income ratio is 1.0, suggesting that all free cash flow is being used to cover net losses. Overall, while there are signs of improvement, the cash flow situation remains weak.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue1.34B1.39B1.58B1.01B643.37M212.08M
Gross Profit222.16M213.56M417.16M33.05M13.81M6.62M
EBITDA-222.41M-266.19M-686.50M-431.72M-297.64M-115.22M
Net Income-353.89M-412.08M-876.25M-742.65M-381.72M-142.00M
Balance Sheet
Total Assets1.39B1.56B2.22B2.64B1.28B580.36M
Cash, Cash Equivalents and Short-Term Investments155.22M161.37M225.72M611.45M395.00M180.35M
Total Debt1.84B1.88B1.87B1.77B522.42M0.00
Total Liabilities2.35B2.40B2.64B2.53B945.80M147.31M
Stockholders Equity-968.75M-840.89M-427.21M108.85M335.54M428.29M
Cash Flow
Free Cash Flow-46.02M-142.51M-488.53M-621.86M-580.28M-290.52M
Operating Cash Flow-46.02M-39.67M-196.13M-286.93M-244.97M-145.77M
Investing Cash Flow-32.73M-8.04M60.00M-705.17M-335.28M-144.75M
Financing Cash Flow87.89M26.00M80.83M827.16M798.00M221.12M

TH International Technical Analysis

Technical Analysis Sentiment
Negative
Last Price2.40
Price Trends
50DMA
2.55
Negative
100DMA
2.68
Negative
200DMA
2.79
Negative
Market Momentum
MACD
-0.04
Positive
RSI
39.44
Neutral
STOCH
34.67
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For THCH, the sentiment is Negative. The current price of 2.4 is below the 20-day moving average (MA) of 2.53, below the 50-day MA of 2.55, and below the 200-day MA of 2.79, indicating a bearish trend. The MACD of -0.04 indicates Positive momentum. The RSI at 39.44 is Neutral, neither overbought nor oversold. The STOCH value of 34.67 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for THCH.

TH International Risk Analysis

TH International disclosed 88 risk factors in its most recent earnings report. TH International 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

TH International Peers Comparison

Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
$18.38B12.79-2.54%3.03%1.52%-15.83%
$35.96M13.5920.12%-1.30%9.43%
$98.80M-5.04%1.00%10.67%-181.88%
$32.50M-0.14170.62%0.96%-57.29%
$81.66M-1.63-12.77%52.05%
$74.91M-7.81%96.64%-292.65%
$92.77M-3.09%-30.16%
* Consumer Cyclical Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
THCH
TH International
2.61
-0.79
-23.24%
RAVE
Rave Restaurant Group
2.53
-0.38
-13.06%
RRGB
Red Robin Gourmet
5.18
-0.53
-9.28%
STKS
The ONE Group Hospitality
2.42
-1.00
-29.24%
FAT
Fat Brands
1.77
-1.16
-39.59%
GENK
GEN Restaurant Group, Inc. Class A
3.00
-5.80
-65.91%

TH International Corporate Events

Tims China Reports Q2 2025 Financial Results with Positive EBITDA and Growth in Loyalty Membership
Aug 26, 2025

On August 26, 2025, Tims China announced its financial results for the second quarter of 2025, highlighting a 1.4% year-over-year increase in system sales to RMB409.5 million and a positive adjusted corporate EBITDA of RMB2.2 million. Despite a 4.9% decrease in total revenues from the same quarter in 2024, the company reported a significant growth in its loyalty club membership, reaching 26.2 million members, a 22.4% increase year-over-year. The company also achieved a historical high in food revenue contribution as a percentage of system sales, reflecting the success of its ‘Light & Fit Lunch Box’ platform. However, the quarter also saw a net closure of nine stores, with a decrease in revenues from company-owned stores due to underperforming store closures and a decline in same-store sales growth.

TH International Announces Board Resignation of Meizi Zhu
Aug 11, 2025

TH International Limited, a company based in Shanghai, China, announced the resignation of Meizi Zhu from its board of directors, effective August 7, 2025. Zhu has been recognized for her significant contributions and leadership over the past six years, which have been instrumental in the company’s growth. The company has decided not to fill her vacated position on the board at this time.

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.Date of analysis: Oct 31, 2025