ZTO Express reported a 50.3% year-over-year increase in adjusted net income for the second quarter of 2026, driven by higher parcel volumes and operational efficiencies. Revenue rose 23% to CNY 14.5 billion, narrowly surpassing analyst expectations of CNY 14.44 billion.
Adjusted net income reached CNY 3.1 billion, up from CNY 2.06 billion in the same period last year, supported in part by a CNY 344.3 million tax refund. Operating income climbed 30.4% to CNY 3.23 billion, while the operating margin expanded by 1.3 percentage points to 22.2%. Gross profit rose 26.8% to CNY 3.7 billion, with gross margin improving to 25.7%.
Parcel volume totaled 10.49 billion, a 6.5% increase year-over-year and outpacing the broader industry’s 4.2% growth. Market share rose by 0.4 percentage points during the quarter. Unit costs for sorting and transportation declined by 3.2% year-over-year, equivalent to a CNY 0.02 reduction per parcel.
Retail parcel volume surged 47% year-over-year, with average daily volumes exceeding 11.87 million. Reverse logistics activity grew approximately 80% year-over-year to around 9.8 million parcels daily. Route-coordinated parcel volume increased 120% year-over-year.
Despite the strong financial performance, ZTO’s shares fell 3.72% in after-hours trading to $22.27, following a 0.96% gain during regular trading hours. The stock’s 52-week range remains between $17.74 and $26.20.
Management highlighted a shift in industry dynamics toward value creation and network stability, with CEO Meisong Lai emphasizing quality over scale. CFO Huiping Yan noted that digitization and lean operations helped offset cost pressures, including a potential CNY 0.01 to CNY 0.02 increase in transportation costs per parcel if oil prices remain elevated.
For the full year 2026, ZTO expects parcel volume growth of 6% to 10%, translating to a total of 40.83 billion to 42.37 billion parcels. The company aims to reduce core transit costs by CNY 0.03 per parcel for the year, while exploring mitigation strategies such as expanding its natural gas truck fleet and digital routing tools.
