Core Viewpoint - Mengjie Co., Ltd. is facing deeper crises beyond its reported profit growth, highlighted by internal governance issues and financial compliance concerns, as evidenced by a board member's dissent regarding the authenticity of the third-quarter report [1][4]. Financial Performance - In Q3 2025, Mengjie reported revenue of 1.099 billion yuan, a decrease of 7.97% year-on-year, while net profit attributable to shareholders was 26.52 million yuan, an increase of 28.69% [1][8]. - The company's revenue has been declining since 2021, with the lowest revenue for the first three quarters since 2017, and a significant drop in net profit in Q3 2025 to only 110.26 thousand yuan, a 92.83% decrease from the previous quarter [2][8]. Internal Governance Issues - Board member Chen Jie has raised concerns about the company's financial compliance, particularly regarding a personal loan of over 60 million yuan that remains unresolved despite regulatory intervention [1][4]. - Chen has consistently questioned the authenticity of the company's financial reports, indicating a pattern of financial mismanagement and potential fraud [1][5]. Regulatory Scrutiny - Mengjie’s subsidiary, Fujian Dafang Sleep Technology Co., Ltd., received a regulatory fine for inadequate financial management and failure to recover loans, which has raised further concerns about the company's internal controls [4][5]. - The company has been accused of cross-period recognition of income and expenses, which is considered a typical form of financial fraud [5][6]. Market Position and Challenges - Mengjie Co., Ltd. is a long-established player in the textile home goods sector, but its performance has been unstable, with significant losses recorded in recent years [7][8]. - The company’s revenue peaked at 2.463 billion yuan in 2021 but has since declined, with a 30.37% drop in revenue by 2024 compared to the peak [8].