BBW Weekly: Slowing takeout dining wars leave Luckin with bitter aftertaste
Slowing takeout dining wars leave Luckin with bitter aftertaste
LKNCY.US | Latest close: 33.27 | 52-week range: 30.0-43.64
China’s largest coffee chain slipped into same-store sales contraction in the first quarter, as the country’s top takeout dining delivery companies eased a subsidy war that had boosted sales
- Luckin’s revenue rose 35% in the first quarter, driven by a 39% year-on-year rise in its store count to 33,596 shops at the end of March
- The chain’s average monthly transacting customers rose 25% in the quarter, far slower than its revenue growth, indicating it is having difficulty retaining customers
By Doug Young
Call it a coffee hangover. That was the story for Luckin Coffee Inc. (LKNCY.US) in the first quarter, as China’s leading coffee chain slipped into same-store sales contraction during the three-month period after reporting strong gains for that metric for most of last year.
In this case, the culprit behind the slowdown was unrelated to Luckin’s own operations, and instead was the result of changes in a subsidy war that charged up China’s takeout dining market for much of last year. That war saw e-commerce giant JD.com enter the takeout dining market, while Ele.me, one of the two major existing players, underwent a big overhaul that included a major cash infusion from Alibaba, China’s leading e-commerce company. The third major player, online-to-offline services leader Meituan, was forced to follow suit by offering its own major subsidies to...
Luyuan charges abroad with new Thai production center, Singapore partnership
2451.HK | Latest close: 11.39 | 52-week range: 6.8547-16.83
The company is joining a recent tide of Chinese electric bike, scooter and motorcycle makers setting up new factories overseas in a bid to jumpstart their stalling growth
- Luyuan has launched an R&D and manufacturing center in Thailand and formed a major partnership in Singapore in its fledgling drive to develop the global market
- The company is joining a growing tide of Chinese electric two-wheeler makers setting up production centers in Southeast Asia, where such vehicles are popular
By Doug Young
The race is on.
Luyuan Group Holding (Cayman) Ltd. (2451.HK) has joined a fledgling move by Chinese two-wheeler makers setting up factories abroad, with its Thursday announcement of plans for a new facility in Thailand. It joins peers like Yadea (1585.HK) and TAILG, which have also recently...
Post-‘Demon Boy’ hangover drains magic from Imax in China
1970.HK | Latest close: 7.36 | 52-week range: 7.29-9.04
The big-screen cinema company’s China revenue tumbled in the first quarter, returning to normal levels after a year-ago boost from animated blockbuster ‘Ne Zha 2’
- Imax’s Corp.’s Greater China revenue fell 49% in the first quarter due to a high year-ago comparison fueled by the blockbuster “Ne Zha 2”
- China’s overall Lunar New Year box office also plunged 39% this year absent the year-ago hit that went on to become the world’s best-grossing animated film
By Lee Shih Ta
When “Ne Zha 2” dominated the Lunar New Year box office last year, rewriting Chinese box office history, the tale of mythical devil child had a halo effect on Imax China Holding Inc. (1970.HK), whose trademark big-screen theaters were packed during the period. By the first quarter of 2026,...
Luxury e-commerce ‘gondolier’ BMax paddles towards Hong Kong IPO
Backed by HSG, formerly Sequoia China, China’s second largest provider of e-commerce services is raising cash for its fast-growing livestreaming business
- BMax has filed to list in Hong Kong, seizing on its status as a first mover in developing livestreaming e-commerce services in the world’s largest online retail market
- The company’s core business offering services in traditional e-commerce grew by just 10% between 2023 and 2025, compared to 64% growth for its livestreaming business
By Edith Terry
In a park in western Shanghai’s leafy Changning district, the Romomo Live Streaming Center is a showcase of livestreaming technology that’s all the rage these days on China e-commerce scene. The facility features 150 broadcast studios in two buildings and 300 resident hosts, who, on any given day, are likely to...
The end of free AI: Agents drive a new cost reality
AI’s cost structure is changing as it shifts from a tool to an autonomous executor, with both businesses and other users increasingly paying for services
By Lee Shih Ta
Over the past two years, the business model for AI has been built on what appeared to be a solid assumption: relatively low computing costs allowed companies to scale users quickly through a “free + subscription” model. Whether in chatbots or productivity tools, AI was typically packaged as an add-on feature to enhance product appeal, rather than as a core revenue generator. Users paid fixed monthly fees for unlimited use, a model that helped accelerate widespread adoption.
But that assumption is now starting to break down.
As AI shifts from being a simple Q&A tool to agent-based products capable of completing...
Asia’s probiotic leader looks for nourishment from Hong Kong IPO
Wecare Probiotics ranked third globally and first in Asia by probiotic raw powder production volume in 2025, even as large amounts of its capacity lay idle last year
- Wecare Probiotics has filed to list in Hong Kong, reporting its overseas sales have grown steadily to contribute 40.2% of revenue last year
- The company has attracted a diverse group of investors, including industrial capital, state-backed funds and market-oriented investment institutions
By Molly Wen
Growing health consciousness among global consumers is providing a boost for probiotics, with China emerging as one of the world’s largest markets. Behind such familiar products as yogurt and supplements are a platoon of upstream manufacturers focused on things like strain research and production, providing the industry with the latest raw materials.
Now, a member of...
RedNote separates its China business, while Texas Chicken plots a massive China entry
“Credibility is not just going to result from telling the world you’re operating from a place outside China.”
Key Takeaways:
- RedNote’s separation of its domestic business from the rest of the world highlights growing credibility and data security hurdles Chinese apps face overseas
- Texas Chicken aims to open 600 stores in China, even as such second-tier fast-food brands often struggle against established giants like KFC
By Doug Young & Rene Vanguestaine
We’re seeing a fascinating divergence in how businesses navigate the border between China and the rest of the world. As recently reported by Wired, the social media sensationRedNote— also known asXiaohongshu in China— is taking steps to separate its China business from its global operations, repeating a strategy we’ve seen from other Chinese internet majorsfacing geopolitical pressure....
GoFintech’s soaring valuation on ‘buzzword of the day’ approach masks low-margin reality
0290.HK | Latest close: 8.43 | 52-week range: 1.31-8.85
The financial services provider has rebranded and pivoted toward high-tech buzzwords, but it relies on low-margin supply chain brokerage services for most of its business
- GoFintech’s has agreed to buy a minority stake in Luffa AI, a decentralized messaging app operator
- The deal marks the company’s latest effort to become a cutting-edge fintech business as it relies on a low-margin supply chain brokerage business for most of its revenue
By Warren Yang
GoFintech Quantum Innovation Ltd.’s (0290.HK) shares have made a quantum leap over the last six months as the company transforms by dipping its toes in a quickly expanding pool of trendy new areas from its core financial services realm. Whether the stock’s spectacular ascent is justifiable is another question.
The latest toe-dipping move came last Friday,...
What robot boost? Zhaowei Machinery faces challenge as growth stumbles
2692.HK | Latest close: 70.25 | 52-week range: 57.1-94.8
The high-precision component maker’s revenue and profit both fell in the first quarter, putting its robotics story to the test
- Zhaowei Machinery’s first-quarter revenue and profit both declined, with its profit down more than 25% year-on-year
- Buoyed by its recent Hong Kong listing, the company’s cash reserves surged to 950 million yuan by the end of March
By Lee Shih Ta
Making robots walk, run, and fight may be complex, but it’s much easier than making them generate profits. In the absence of such profits, makers of robots that serve tea, pour water, dance and do somersaults have instead relied on a steady flow of fresh investor capital to keep their operations running. Meantime, profits for the sector remain elusive, and revenue is unstable, even as valuations for...
China’s robotaxi race hits a safety pause
BIDU.US | Latest close: 139.87 | 52-week range: 81.17-165.3
Baidu’s Wuhan outage, Hello’s Zhuzhou injury accident and a reported pause on new permits suggest China’s autonomous taxi drive is shifting focus to safety
- China’s robotaxi story is transitioning from one of ride volume, city coverage and vehicle cost to one of safety after two recent incidents
- Baidu still offers the biggest scale in China, but Pony AI, WeRide, XPeng, Caocao and U.S. rivals like Waymo and Tesla are turning robotaxis into a crowded global contest
By Hu Minghe
China’s robotaxi sector was supposed to be entering an era of scale, as operators put more of their vehicles on the road after years of testing. Instead, it’s now getting a safety audit – which some may argue was overdue.
A February report from the China Academy of Information...
Wybotics in sprint to become Hong Kong’s first pool equipment stock
The maker of robotic pool cleaners has updated its Hong Kong IPO prospectus after an earlier application from last September lapsed
- Wybotics’ updated Hong Kong IPO application shows it ranks third globally in robotic pool cleaners and holds the top spot for cordless models
- The company’s gross profit margin has risen steadily over the last three years as it builds up its own brands and downplays its legacy ODM business
Cheng Shui Tong
The race is on. Robotic pool cleaner maker Wybotics Co. Ltd. applied to float shares in Hong Kong late last month, beating out a similar filing from rival pool equipment maker Fairland Corp. by just days.
Wybotics is the world’s third largest maker of robotic pool cleaners with 9.2% of the market in 2024, according...
Plummeting cash flow and a stake-trimming top shareholder: What’s up at Zhejiang Shibao?
1057.HK | Latest close: 5.06 | 52-week range: 3.88-7.39
The automotive steering systems maker’s profit fell despite growing revenue in the first quarter, prompting investors to vote with their feet
- Zhejiang Shibao reported its operating cash flow plunged by more than 85% year-over-year in the first quarter
- The company’s major shareholder abruptly announced a plan to trim its stake by up to 3% the day after the release of its latest quarterly report
Lau Chi Hang
Among companies that are dually traded on both China’s domestic A-share market and in Hong Kong, automotive steering systems maker Zhejiang Shibao Co. Ltd. (1057.HK; 002703.SZ) stands out for a prolonged valuation gap between its pair of listings. Its share price is notoriously volatile and unpredictable. It continued that tradition with last week’s release of its first-quarter financial results, which failed...
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