Nayuki’s first-half revenue falls 13% as bakery and bottled beverage segments shrink, leaving all growth engines stalled — BigGo Finance

Nayuki (02150.HK), once crowned as the “first listed stock of the new-style tea beverage sector,” remains mired in a prolonged loss-making quagmire. According to its interim results announcement released on August 26, the company posted first-half 2026 revenue of 1.89 billion yuan (approximately $281.7 million), down 13.09% year-on-year, with an adjusted net loss of 97 million yuan (approximately $14.4 million), narrowing about 18% from a year earlier. The core driver of the loss reduction came from streamlining underperforming stores and compressing rent and labor costs, rather than any substantive improvement in underlying business fundamentals.

The secondary market reacted swiftly. On the day after the earnings release, Nayuki’s share price closed down 7.59% at HK$0.67 (approximately $0.0855), leaving its total market capitalization at just HK$1.13 billion (approximately $143.9 million). Compared with its peak market value of HK$34 billion (approximately $4.3 billion), Nayuki has been reduced to a penny stock.

Core business hit by falling volume and price; price cuts fail to drive volume

The freshly made tea beverage business remains Nayuki’s foundation, generating revenue of 1.46 billion yuan (approximately $216.7 million) in the first half of 2026, down 11.17% year-on-year. Directly-operated stores contributed 86.6% of group revenue and are the decisive factor in operating performance.

Facing intensifying market competition, Nayuki attempted to break through by lowering average ticket prices to drive volume. In the first half, the average order value at directly-operated stores fell from 25.7 yuan to 24.3 yuan, down 5.44% year-on-year. However, the price-cut strategy failed to generate order growth—average daily order volume declined from 296.3 to 286.7 orders, a decrease of 9.6 orders year-on-year; average daily sales per store fell from 7,600 yuan to 7,000 yuan, down 600 yuan. With both volume and price under simultaneous pressure, directly-operated store revenue came in at 1.64 billion yuan (approximately $243.9 million), down 14.28% year-on-year.

The shift in channel mix is equally concerning. In the first half, in-store ordering revenue at directly-operated stores fell 37.5% year-on-year, self-pickup revenue declined 24.5%, while delivery revenue remained essentially flat. Delivery orders rose to 55.9% of directly-operated store revenue from 48.1% previously, with third-party delivery platforms contributing 53.3% of directly-operated store revenue. Consumer willingness to dine in-store continued to weaken, with dine-in revenue share squeezed to single digits.

The shift toward online channels has brought additional cost pressure. In the first half, Nayuki’s delivery service fees only edged down from 201 million yuan (approximately $29.9 million) to 197 million yuan (approximately $29.3 million), but as a share of group revenue they actually rose from 9.2% to 10.4%. Advertising and promotional expenses increased from 94 million yuan (approximately $14.0 million) to approximately 100 million yuan (approximately $14.9 million), with their share of revenue rising from 4.3% to 5.3%. The company noted that increased marketing and promotional investment included more delivery platform promotional activities. This incremental pressure partially offset the loss-reduction benefits from cost optimization in materials and staffing.

Net cash generated from operating activities fell from 138 million yuan (approximately $20.5 million) in the same period last year to 61 million yuan (approximately $9.1 million), down 56.1% year-on-year, indicating that the recovery in revenue and cash flow has not kept pace with the on-paper loss reduction.

Two secondary growth curves contract simultaneously

Beyond the freshly made tea business, Nayuki had earlier laid out two additional business lines—bakery products and bottled beverages—as second growth curves aimed at raising average ticket prices, opening retail channels, and reducing dependence on physical stores. But in the first half of this year, both curves contracted markedly.

“Tea plus European-style bread” was once Nayuki’s signature combination. During the reporting period, the bakery products business recorded revenue of 133 million yuan (approximately $19.8 million), down 32.48% year-on-year. The sense of spaciousness that Nayuki had painstakingly cultivated in its stores has become a cost burden in the new consumer environment. In-store ordering revenue was just 126 million yuan (approximately $18.8 million), accounting for 7.7% of directly-operated store revenue. The “large store plus social space” business model is gradually fading.

Bottled beverages represent another attempt at cross-channel expansion. The company launched related products as early as 2021 and entered multiple leading convenience store and supermarket channels. However, China’s beverage market is intensely competitive, and Nayuki has neither a cost advantage nor a nationwide channel network, with its products generating diminishing market buzz. In the first half, bottled beverage revenue was just 73 million yuan (approximately $10.9 million), down 31.78% year-on-year, with the revenue scale shrinking severely.

The predicament facing the bakery and bottled beverage businesses is fundamentally a mismatch between products and channels. Bakery products depend on dine-in scenarios, but store revenue increasingly relies on delivery and self-pickup orders, with afternoon tea and other in-store consumption scenarios being steadily eroded. Bottled beverage products, meanwhile, face direct competition from established beverage giants, placing Nayuki at a clear disadvantage in sales channels and supply chain capabilities.

Scale gap continues to widen

As the industry enters an era of refined operations on existing stock, peers have leveraged franchise models to expand rapidly, widening the scale gap. Brands such as Mixue Group, Chabaidao, and Auntea Jenny have reached store counts in the thousands or even tens of thousands. By comparison, Nayuki’s store expansion has nearly ground to a halt.

As of end-June 2026, Nayuki’s nationwide store count stood at 1,685, a net increase of only 39 stores from end-2025. Of these, directly-operated stores increased from 1,288 to 1,315, a net gain of 27; franchised stores grew from 358 to 370, a net gain of 12. Regionally, directly-operated stores in China’s first-tier cities decreased by 5, while new first-tier, second-tier, and other cities saw net increases of 6, 16, and 10 stores respectively. The vast majority of these stores are located in first- and second-tier cities, with limited store density and a scale that significantly lags the industry’s top tier.

Notably, the number of directly-operated stores has ended its previous contraction trend and begun shifting toward selective expansion. The company said it will continue to dynamically adjust based on actual store operating conditions and steadily expand its store network in advantageous cities and core consumer markets. This suggests Nayuki is attempting to strike a new balance between “loss reduction” and “renewed growth.”

Facing pressure across its core business and two secondary businesses, Nayuki continues to iterate its product offerings, experimenting with new products such as fruit coffee and focaccia sandwiches in hopes of creating fresh consumer appeal. However, these products are still in the trial stage, with small volumes and no breakout hits to date. As of now, the company still lacks a definitive growth engine, and the transition between old and new businesses has failed to gain traction.

Since its listing, apart from a brief annual profit in fiscal 2023, Nayuki has posted losses in every other fiscal year, prompting market observers to quip that it “sells the most expensive milk tea while running the most money-losing business.” At a previous shareholders’ meeting, the company was even confronted on the spot by shareholders questioning its operating performance. With the core tea business lacking growth momentum and both the bakery and bottled beverage growth curves stalling, Nayuki has yet to find a sustainable growth path, and operating pressure is likely to remain acute for an extended period.