Core Viewpoint - Uniqlo is facing challenges in the Greater China market, which was once a significant growth driver, now becoming a profit drag due to declining consumer demand and increased competition from local brands [3][11][16]. Financial Performance - For the third quarter ending May 31, 2025, Uniqlo reported a revenue increase of 7.7% year-on-year to 826.5 billion yen (approximately 40.4 billion RMB), but net profit decreased by 9.7% to 105.5 billion yen (approximately 5.16 billion RMB) [3]. - In the first three quarters, revenue in the Greater China market decreased by approximately 3% in local currency, with operating profit down about 8% [4]. - The management estimates a revenue decline of about 10% and profit contraction for the second half of the 2025 fiscal year in the Greater China market [5]. Market Dynamics - Uniqlo's performance in Japan, North America, Europe, and Southeast Asia remains strong, contrasting with the weak demand in China, which has affected overall net profit [3]. - The company has seen a significant drop in same-store sales since 2024, attributing 50% of the poor performance to external factors and 50% to internal issues [11]. Strategic Adjustments - Uniqlo is undergoing structural reforms, focusing on product pricing adjustments and enhancing marketing efforts to better align with consumer expectations in China [5][16]. - The company is shifting its strategy from expanding the number of stores to improving the profitability of existing locations, with plans to open regional flagship stores in major cities [15][18]. Competitive Landscape - The rise of "alternative products" from local brands is seen as a significant threat to Uniqlo's market share in China [15]. - Uniqlo aims to coexist with local brands, leveraging collaborations with artists and designers to create differentiated products [16]. Future Outlook - Management targets improved performance in the 2026 fiscal year compared to 2025, with a complete transformation of the business model by the 2027 fiscal year [17]. - The company maintains its revenue and profit outlook for the 2025 fiscal year at 3.4 trillion yen and 410 billion yen, respectively, which translates to approximately 166.5 billion RMB and 20.1 billion RMB [18].