Luckin Coffee, a reputable coffee chain, has disclosed another quarter of impressive double-digit revenue growth. This growth is mainly attributed to the company’s strategic focus on expanding its reach across various regions.
In the fourth quarter, which concluded on December 31, the company’s net revenues climbed by 32.9 per cent, reaching RMB12.7 billion (US$1.8 billion). The primary driver of this growth was the net opening of 1834 new stores, of which 1792 are in China, 13 in Singapore, 25 in Malaysia, and four in the United States. By the end of the quarter, the total count of stores stood at 31,048. This includes 20,234 company-operated stores and 10,814 locations in partnership.
The same-store sales of company-operated outlets grew by 1.2 per cent. This presents a significant improvement from the 3.4 per cent decrease experienced in the same period last year.
During the quarter, the Gross Merchandise Value (GMV) witnessed a 32.8 per cent rise. Concurrently, the average number of monthly transacting customers surged by 26.5 per cent.
However, the GAAP operating income demonstrated an 18 per cent fall, amounting to RMB821.4 million. Additionally, the net income decreased by 39 per cent to RMB518.2 million.
For the entire year, the net revenues escalated by 43 per cent, reaching RMB49.2 billion. This increase was accompanied by the opening of 8708 net new stores. The net income demonstrated a 22 per cent rise, standing at RMB3.6 billion.
Jinyi Guo, the co-founder and CEO of Luckin Coffee, offered insights into the company’s performance. Guo highlighted the strength of the company’s execution focused on scale, which enabled it to achieve robust growth amidst fluctuating market dynamics.
Guo stated, “We concluded the year on a strong note, achieving the milestone of our 30,000th store and expanding our cumulative transacting customer base to over 450 million.”
He further noted that the company’s increased scale strengthened its market leadership and boosted its capability to harness the structural tailwinds of China’s coffee market.
What contributed to Luckin Coffee’s impressive growth in the fourth quarter?
The company’s significant growth was primarily driven by the net opening of 1834 new stores across various regions.
How did the company’s financial performance fare in this period?
Despite the impressive revenue growth, Luckin Coffee saw a decrease in GAAP operating income by 18 per cent and net income by 39 per cent.
What does the company’s expansion signify?
The expansion of Luckin Coffee’s scale has fortified its market leadership and equipped it to tap into the structural tailwinds of China’s coffee market effectively.
