Core Viewpoint - Xtep's mid-year performance for 2025 shows record profits, but concerns arise from reliance on a single product line and the need for strategic growth beyond current capabilities [2][3][4] Financial Performance - Xtep's revenue from continuing operations increased by 7.1% to 6.838 billion yuan, with net profit rising by 21.5% to 914 million yuan, marking a historical high [2] - The operating profit grew by 9.1% to 1.305 billion yuan, indicating overall positive financial health [2] Brand Performance - The main brand's revenue growth was only 4.5%, reaching 6.053 billion yuan, a decline from previous growth rates of over 10% [5] - Saucony, positioned as the "second growth curve," achieved a 32.5% revenue increase to 785 million yuan, but this only accounts for 12% of total revenue [4][3] Strategic Initiatives - Xtep plans to invest 400 million yuan to open 400 Direct-to-Consumer (DTC) stores, aiming to enhance retail control despite potential short-term profit erosion [2][6] - The company has streamlined its brand portfolio, retaining only three brands: Xtep, Saucony, and Maile, after divesting K-Swiss and Palladium [3] Market Positioning - Xtep's focus remains on the mass consumer market in China, with a strong brand identity as the "first running brand in China" [5] - The company faces challenges in diversifying its product offerings beyond footwear, which may limit growth potential compared to competitors like Anta and Li Ning [5]