(Yicai) Feb. 27 -- China’s Luckin Coffee posted a 23 percent jump in profit for last year, fueled by rapid store expansion, a higher monthly active customer count, and a rebound in same-store sales.

Net profit was CNY3.6 billion (USD525 million) in the 12 months ended Dec. 31, the Xiamen-based coffee chain announced yesterday. Revenue soared 43 percent to CNY49.2 billion (USD7.1 billion).

The earnings were also driven by the price war among China’s delivery platforms. Starting from the second quarter, major platforms began offering big subsidies on freshly made beverages, igniting a fresh growth spurt in the country’s coffee and milk tea markets. Luckin sold 4.1 billion freshly made drinks, which is roughly equivalent to three cups per person in the country.

The coffee giant opened 8,708 new outlets last year, a 39 percent annual increase, bringing the total number to 31,048. Average monthly active customers surged 31 percent, and the company had more than 100 million for five consecutive months from June. Same-store sales growth at self-operated outlets recovered to 7.5 percent from minus 17 percent the year before.

Given the high comparative base resulting from generous subsidies from platforms last year, this year’s same-store sales and profit may face some near-term challenges and swings, Chairman and Chief Executive Guo Jinyi said.

“China's coffee industry is still in its early stages, with significant growth potential,” he said, adding that short-term bumps in the road will not alter the long-term growth trajectory.

The competitive landscape is changing, though, Guo said. Brands can no longer rely solely on price, a single hit product, or specific marketing campaigns. This year, Luckin plans to continue opening new stores at a "competitive" pace, and will shift its pricing approach to “maintaining competitive pricing while expanding the product price range.”

In the last quarter of 2025, as the fresh drinks market entered its low season and subsidies started to ease, Luckin’s net profit plunged 39 percent from a year earlier to CNY520 million (USD75.8 million). Revenue climbed 33 percent to CNY12.7 billion (USD1.8 billion).

Quarterly same-store sales and profit were affected by a combination of seasonal factors, changes in the subsidy strategies of delivery platforms, and adjustments in the product mix, all of which were expected, Guo pointed out.

Editor: Kim Taylor