Xtep International Holdings reported a 12% net profit margin for the first half of 2026, with net profit rising to RMB 818 million despite flat revenue of RMB 6.795 billion. The sportswear company attributed the improvement to higher gross margins, which expanded by 1.4 percentage points year-on-year to 46.4%, driven by cost controls and product mix shifts.
Gross profit increased 2.6% to RMB 3.155 billion, while adjusted operating profit reached RMB 1.204 billion with a margin of 17.7%. Professional sports revenue grew 11.4% to RMB 875 million, now accounting for 12.9% of total revenue. Mass sports revenue, however, declined 2.2% to RMB 5.92 billion, with operating profit down 7.3% to RMB 1.12 billion.
Operating cash flow rose 9.5% to RMB 847 million, and the group’s net cash position increased 36.3% to RMB 2.326 billion. The company recommended an interim dividend of HKD 0.18 per share, lifting the payout ratio to 53.8%. Management noted a 12% year-on-year rise in accounts receivable turnover days to 123 days, while inventory turnover days increased by 28 days to 105 days.
Executives highlighted strong performance in marathon wear, with Xtep and Saucony exceeding a 50% wear rate at major domestic events, including the Xiamen and Chongqing marathons. The group launched new products in August, including the 160X 8.0 racing shoes and Airflow Zero Series cushioning flagship, alongside the carbon plate-free 2000KM series, which saw sales surge about 70% year-on-year. The Xtep A-Plus growth shoes for children doubled in sales, while the environmental 160X 7.0 PRO line reduced carbon emissions by 12.7 grams per pair.
As of June 30, Xtep operated 6,308 adult stores under its core brand, 1,455 X Young stores, and 180 Saucony outlets in China. The company expanded into Southeast Asia with 13 new flagship stores in Malaysia and Indonesia during the period. Stock price rose 6.16% to close at HKD 3.79 following the earnings update, within a 52-week range of HKD 3.45 to HKD 6.78.
