Core Insights - Chagee Holdings Ltd. reported a revenue increase of 10.5% in the second quarter, driven by its expansion into the U.S. market with the opening of its first store in Los Angeles [2][3] Financial Performance - The company generated revenue of 3.33 billion yuan ($467 million) in the second quarter, reflecting a 10.2% increase from 3.02 billion yuan a year earlier [4] - Gross merchandise value (GMV) rose by 15.5% year-on-year to 8.1 billion yuan, with a store count reaching 7,038, up 40.9% from the previous year [4] - Adjusted net profit remained flat at 630 million yuan, with a non-GAAP net income margin dropping to 18.9% from 20.8% a year earlier [10] Market Expansion - Chagee has aggressively expanded its store network, with 6,830 stores in China, a 40% increase from 4,881 a year earlier, and nearly doubling its overseas network to 208 stores from 115 [5] - GMV from overseas stores surged 77% during the quarter to 235 million yuan, with plans for further expansion in the U.S. market [5][6] Strategic Initiatives - The company has appointed a former chief marketing officer for Starbucks China as its new chief commercial officer for North America, and a food and beverage veteran as its North America chief development officer [6] - Chagee plans to continue strategic investments in overseas markets and enhance its global talent pipeline and operational system [7] Membership Growth - The company's membership program reached 206.9 million users at the end of June, marking a 42.7% year-on-year increase [9] Competitive Landscape - The premium tea market in China has become highly competitive, with top chains opening thousands of new stores annually, leading to pressure on profit margins [10] - Chagee aims to maintain its premium image to avoid price wars that have affected other sectors, despite the competitive pressures impacting its profitability [10]