Li Ning Company (2331) H1 2026 earnings summary

Executive summary

• Revenue grew 2.8% year-on-year to RMB 15,235 million, with net profit at RMB 1,816 million and net profit margin of 11.9%.

• Gross profit margin rose 0.9 percentage point to 50.9%, driven by cost optimization and product mix.

• Apparel revenue outperformed, up 12% year-on-year, while footwear grew 1% and accessories declined 18%.

• Retail environment weakened in Q2 due to weather disruptions, deepening discounts, and declining footfall, impacting sales.

• Strategic focus on professional innovation, channel optimization, and brand partnerships, including a new deal with Curry.

Financial highlights

• Gross profit rose 4.5% year-on-year to RMB 7,751 million; EBITDA was RMB 3,370 million with a margin of 22.1%.

• Net operating cash flow was RMB 954 million, down year-on-year due to increased cash outlay and prepayment for the Curry partnership.

• Basic EPS increased 4.4% year-on-year to RMB 70.4 cents.

• Interim dividend of RMB 35.12 cents per share, maintaining a 50% payout ratio; total dividends ~RMB 908 million.

• Net cash position remains strong at RMB 19,391 million as of June 2026.

Outlook and guidance

• Full-year revenue target adjusted to low single-digit growth; net profit margin target set at medium to high-single-digit.

• Second half expected to face greater operational risks, with increased marketing expenses and cautious outlook.

• Ongoing multi-category strategy, Olympic partnerships, and continued investment in brand, marketing, and professional sports resources.

• Focus remains on “Single Brand, Multi-categories, Diversified Channels” strategy.

• Plans to leverage policy tailwinds, expand omni-channel presence, and invest in technology and product innovation.