Core Viewpoint - Li Ning Company reported a revenue of 14.82 billion RMB for the first half of 2025, reflecting a year-on-year increase of 3.3%, with a net profit of 1.74 billion RMB and a net profit margin of 11.7% [1] Financial Performance - Revenue reached 14.82 billion RMB, up 3.3% year-on-year - Gross profit was 7.41 billion RMB, with a gross margin of 50.0% - Net profit stood at 1.74 billion RMB, with a net profit margin of 11.7% [1] R&D Investment - R&D investment increased by 8.7% year-on-year, totaling over 3.8 billion RMB in the last decade - The company has enhanced its ability to convert technological research into product applications [1][2] Product Development - The introduction of "超䨻科技" technology in new products has been well-received in the market - The "越影5 PRO" running shoes are the first to feature this technology, enhancing the company's product lineup [2] Market Segmentation and Growth - The company focuses on six core categories: running, basketball, cross-training, badminton, table tennis, and sports leisure - Running, basketball, and cross-training categories accounted for 67% of retail sales [2] Sales Performance - The running category saw a retail sales increase of 15%, with over 14 million pairs of professional running shoes sold - The company’s running shoes achieved a 61.35% market share among runners completing the Beijing Half Marathon in under 90 minutes [3] Operational Efficiency - Li Ning Company maintains a channel inventory turnover ratio of 4 months, with an inventory turnover period of 61 days - The company emphasizes systematic inventory management to ensure healthy channel inventory levels [5] Channel Strategy - The company is optimizing its channel structure by collaborating with top commercial entities and expanding into emerging markets - As of June 30, 2025, the total number of Li Ning stores reached 7,534 [4]

Core Viewpoint - 2024 is a significant year for sports, with Li Ning demonstrating strong financial performance and brand improvement, positioning itself for future growth as a new sponsor for the Chinese Olympic Committee [1][8]. Financial Performance - Li Ning achieved revenue of 28.676 billion RMB, a year-on-year increase of 3.9% [2]. - The net profit reached 3.013 billion RMB, with a net profit margin of 10.5% [2]. - Gross profit was 14.156 billion RMB, up 6.0% from the previous year, with an overall gross margin of 49.4%, an increase of 1 percentage point [2]. Operational Highlights - Li Ning's operating cash flow was 5.27 billion RMB, a year-on-year increase of 12.4%, indicating strong risk resilience and efficient supply chain management [3]. - The inventory turnover days were 64 days, with a cash cycle of 35 days, reflecting healthy inventory management [3]. - R&D expenditure increased by 9.4%, outpacing revenue growth, highlighting a commitment to innovation and product competitiveness [3]. Strategic Focus - Li Ning is deepening its focus on professional fields and product categories, enhancing brand value and long-term competitiveness [5]. - The company is concentrating on six core categories: basketball, running, fitness, badminton, table tennis, and sports lifestyle, with a comprehensive product layout [6]. - In basketball, Li Ning launched several successful models, including the "伽马" series, which topped annual basketball shoe rankings [6]. Brand and Market Positioning - Li Ning became the official strategic partner of the Chinese Men's Professional Basketball League in 2024, enhancing its brand recognition [7]. - The company has achieved significant success in running, with retail sales increasing by 25% year-on-year, and has sold over 10.6 million running shoes [6][7]. - The upcoming Olympic cycle starting in 2025 is expected to further strengthen Li Ning's brand image and market position [8]. Conclusion - Li Ning's solid performance reflects a strategic recalibration, focusing on operational quality, technological depth, and brand potential, setting the stage for a new growth cycle [8][9].

Core Insights - The key takeaway from Li Ning's latest financial report is the emphasis on "stability," which the company interprets as a commitment to robust operations rather than conservative management [1] - Li Ning's strategy focuses on "single brand, multiple categories, and multiple channels," leveraging technological innovation to strengthen its brand positioning in professional sports [1][2] Financial Performance - In the fiscal year 2024, Li Ning achieved a revenue of 28.68 billion RMB, representing a year-on-year increase of 3.9% [1] - The gross profit margin improved to 49.4%, up by 1 percentage point compared to the previous year [1] - Operating cash flow increased by 12.4% to 5.27 billion RMB, and the company declared a final dividend of 0.2073 RMB per share, raising the annual payout ratio to 50% [1] Product and Innovation Strategy - Li Ning continues to focus on six core categories: running, basketball, cross-training, badminton, table tennis, and sports lifestyle, with the running category seeing a retail sales growth of 25% [2] - The company has successfully sold over 10.6 million pairs of its core running shoes, showcasing its strong technological capabilities [2] - In the basketball segment, Li Ning has developed a comprehensive shoe matrix that caters to various player needs, with the "Gamma" basketball shoe receiving accolades as the best performance shoe of the year [4] Research and Development - Li Ning has increased its R&D investment by 9.3% in 2024, outpacing revenue growth, which reflects its commitment to enhancing its technological capabilities [4][5] - The company has made significant advancements in its "Li Ning Cloud" technology platform, evolving from a single technology to a multi-faceted platform over the past six years [5] Market Positioning and Strategy - Li Ning's ability to maintain stability in a challenging market is attributed to its deep understanding of the sports industry and its innovative approach to meet consumer demands [7] - The company has implemented effective inventory management, maintaining an industry-leading inventory turnover of 64 days and a sell-through ratio of four months [7] - Li Ning is actively expanding its presence in emerging markets while optimizing operations in higher-tier markets through refined management practices [8] Future Outlook - The company's focus on professional sports and continuous innovation is expected to enhance its brand recognition and financial performance in the future [6][11] - Li Ning is also exploring opportunities in new sports categories such as outdoor activities, tennis, and pickleball, demonstrating its proactive approach to capturing new business opportunities [11]