MINISO Group (NYSE:MNSO) reported stronger-than-expected March quarter 2026 revenue and outlined plans to keep expanding larger-format stores, proprietary intellectual property products and overseas direct-to-consumer operations.
Founder and Chief Executive Officer Jack Ye said revenue reached nearly RMB 5.7 billion, up 28.5% year over year and above the high end of the company’s prior guidance. Adjusted net profit, excluding foreign exchange gains and losses, was RMB 630 million, up 8%. Ye also said operating cash flow rose 40% and free cash flow increased 36%.
China Store Upgrades Drive Same-Store Growth
MINISO said mainland China delivered high-single-digit same-store sales growth in the quarter, while North America posted mid-double-digit same-store sales growth. Zhang said Europe and Latin America also generated positive same-store sales growth, a trend the company expects to continue in the second quarter.
Ye said MINISO’s store upgrade strategy remains central to its China growth plan. Although MINISO brand store count in China rose by fewer than 10%, he said per-store GMV increased 25%. Ye also said the share of profitable franchisee stores reached the highest level in recent quarters, which he described as evidence that larger-format stores are improving franchisee economics.
The company said it received thousands of new store applications, about half of which were for large-format or flagship stores. In the quarter, MINISO renovated about 80 stores, and Zhang said average daily sales at those stores improved by more than 50% after renovation. The company plans to renovate more than 300 stores in 2026.
By quarter-end, MINISO had 8,210 stores worldwide, including 3,670 overseas stores. TOP TOY had 355 stores, including 39 outside China. Zhang said theme park stores, flagship stores and large-format stores accounted for 12% of total store count but contributed 30% of sales.
IP Strategy and Membership Remain Key Priorities
Ye said MINISO’s ability to operate large stores depends on “content density,” citing the company’s licensing rights to more than 150 global IPs, its network of 2,000 global suppliers and a supply chain capable of refreshing assortments weekly.
The company highlighted Yuyu, a proprietary IP developed in-house, as an example of its strategy. Ye said Yuyu surpassed RMB 100 million in sales within six months of launch and appeared at the Met Gala as an accessory and event gift. He said the performance shows MINISO’s proprietary IP strategy is entering a “harvest stage.”
Membership also remains a major growth driver. Ye said members contributed 60% of total sales for full-year 2026 and 73% in the first quarter, with repeat purchases accounting for 60% of member sales. Zhang said MINISO plans to use AI capabilities and membership data to improve demand forecasting, targeting and same-store sales growth.
Indonesia, U.S. and Europe in Focus
Ye said Indonesia remains one of MINISO’s most important international markets, despite recent “bumps” as the business reached scale. He said the company has established a headquarters-led negotiation team to pursue prime locations, is tailoring product assortments by store type and is strengthening local IP execution. Ye said Indonesia delivered a “solid profit contribution” last year and expects profitability to be “much better” this year.
In the U.S., Ye said the company’s core price range of $5 to $25 provides an advantage during inflationary pressure because purchases are driven by emotional IP connections. In response to tariff and cost pressures, Ye said MINISO has started differentiated price adjustments on high-frequency items such as bottled water and T-shirts, adding that May gross margin had already improved compared with April.
Europe also remains a long-term focus. In response to an analyst question, Ye said Poland and Germany have outperformed expectations, with store-level and market-level operating margins reaching double digits. He said Germany’s operating margin across more than 10 stores has stabilized at a double-digit level.
Margins, Cash Position and Outlook
Gross margin was 43.3%, down from 44.2% a year earlier. Zhang attributed the decline to a smaller revenue mix from higher-margin overseas business, disciplined pricing in China and an increasing contribution from newer domestic products such as quick commerce stores that are still ramping margins.
Total operating expenses excluding share-based compensation rose 34%, with selling expenses increasing 37.7%. Zhang said the increase was driven by direct-operated store investments, licensing fees and advertising and promotion activities tied to brand upgrades and proprietary IP marketing.
The company recorded RMB 870 million in fair value gains from a direct investment in an AI company following that company’s IPO and share price appreciation. Zhang said management does not view the gain as reflective of core operating profit, and it was excluded from adjusted operating profit and adjusted net profit.
MINISO ended the quarter with RMB 7.05 billion in cash. Zhang said the company distributed more than $160 million in dividends in April and May, bringing accumulated shareholder returns to RMB 6.23 billion. He also said Ye had announced plans to increase his shareholding and that the company intends to conduct share buybacks depending on market conditions.
For full-year 2026, MINISO expects high double-digit revenue growth and a three-year compound growth rate of no less than 22%. The company expects 450 to 500 net store additions for the year, while emphasizing store quality. Excluding foreign exchange gains and losses, Zhang said adjusted net profit growth is expected to accelerate compared with 2025.
About MINISO Group (NYSE:MNSO)
MINISO Group (NYSE: MNSO) is a global retailer specializing in lifestyle and consumer goods. Since its founding in 2013, the company has focused on offering affordable, design-driven products across a broad range of categories. MINISO’s stores feature a clean, minimalist layout and emphasize a “fast fashion” inventory model designed to turn over goods quickly and respond to emerging trends.
The company’s product mix spans household items, kitchenware, cosmetics and personal care, stationery, toys, digital accessories, apparel and seasonal items.
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