Core Viewpoint - In Q3 2025, the overall sales volume of Li Ning brand (excluding Li Ning YOUNG) experienced a decline in unit numbers, with offline sales significantly impacted by foot traffic and consumer spending, while e-commerce showed a high single-digit growth year-on-year [1][2][3] Sales Performance - Q3 2025 saw a high single-digit decline in offline sales, primarily due to reduced foot traffic and consumer spending, with direct retail channels performing better than wholesale channels, benefiting from strong performance in outlet channels [1][2] - E-commerce business recorded a high single-digit growth year-on-year, with an increase in growth rate compared to Q2 [2][3] - The children's clothing segment continued to outperform adult clothing, with expectations of double-digit growth in children's apparel [2] Inventory and Discounts - The company increased its inventory turnover ratio at the end of Q3 2025, with a ratio corresponding to 5-6, as preparations were made for upcoming holidays and promotional events [1][2] - Both online and offline discount rates deepened in low single digits during Q3 2025, as the company intensified promotional efforts [2][3] Channel Expansion and Marketing Strategy - As of Q3 2025, the total number of Li Ning's sales points reached 6,132, with a net increase of 15 points since the beginning of the year, while children's clothing sales points totaled 1,480, with a net increase of 12 points [3] - The company plans to enhance marketing investments focusing on the "Olympics + Technology" theme in Q4 2025, aiming to improve product development and brand influence [3] - New product launches are expected in Q4, including technologically advanced products and collaborations, which are anticipated to drive sales improvement [3] Financial Forecast - The projected revenue for the company from 2025 to 2027 is estimated at 28.93 billion, 30.51 billion, and 32.08 billion yuan, with year-on-year growth rates of +0.9%, +5.4%, and +5.2% respectively [4] - The expected net profit attributable to shareholders for the same period is forecasted at 2.43 billion, 2.62 billion, and 2.78 billion yuan, with year-on-year changes of -19.5%, +7.8%, and +6.2% respectively [4]

Core Viewpoint - The company is facing pressure on overall revenue due to warmer weather, leading to a year-on-year decline in total channel revenue in the mid-single digits for Q3 2025, while maintaining a focus on marketing investments for the Olympics and product innovation [1][3]. Revenue Performance - In Q3 2025, total channel revenue decreased in the mid-single digits year-on-year, with a month-on-month weakening trend observed from July to September [1]. - Breakdown of revenue by channel shows offline channels experiencing a high single-digit decline, with wholesale channels down significantly and direct sales channels down in the mid-single digits; online channels, however, saw a high single-digit growth [1]. Discount and Inventory Management - Discounts have deepened across channels, with overall channel discounts increasing in the low single digits year-on-year; the wholesale channel saw a slight increase, while direct sales and e-commerce channels experienced a more significant increase [2]. - Inventory levels are manageable, with a healthy inventory-to-sales ratio maintained at 5-6 months; it is expected to be controlled at 4-5 months by year-end [2]. Store Expansion - The number of main brand stores increased to 6,132 by the end of Q3 2025, with a net addition of 33 stores from the previous quarter and 15 stores from the previous year; direct stores decreased by 46 from the previous year, while wholesale stores increased by 61 [2]. Product Innovation - The company is actively promoting new products, including the launch of the superbeng capsule for key products like the Feidian 6 and Chitu 9, as well as new basketball and outdoor products [2]. Marketing Initiatives - The company is enhancing its marketing efforts, including the launch of the 2026 Milan Winter Olympics gear for the Chinese sports delegation and collaborations for skiing events [3]. Profit Forecast and Investment Recommendation - The company aims to maintain revenue stability through 2025, with projected revenues of 28.74 billion, 30.29 billion, and 31.87 billion yuan for 2025-2027, reflecting growth rates of 0%, 5%, and 5% respectively; net profits are projected at 2.4 billion, 2.71 billion, and 2.96 billion yuan, with year-on-year growth rates of -21%, 13%, and 9% [3]. - The current stock price corresponds to a PE ratio of 17X for 2025 and 15X for 2026, with a strong buy recommendation maintained [3].