On August 28, Miniso Group Holding Limited (NYSE:MNSO) held its interim earnings call, and the numbers told two very different stories under one roof. In China, the company posted its fastest first-half growth in three years, built on a membership base that just crossed 130 million people. Overseas, the picture looked rougher, with profit contribution shrinking to a fraction of what it was three years earlier. Investors now have to weigh a booming home market against a global expansion still finding its footing.
A Membership Engine Hits Overdrive
Miniso’s China business grew revenue 26.2% in the first half of 2026, a pace management called its fastest in three years and one that dwarfed the 1.3% growth in the country’s broader retail sales over the same stretch. That gap matters because it points to market share gains rather than a rising tide lifting all boats. Behind the growth sits a membership program that reached 130 million people in China as of June 30, up 31% year over year and an all-time high. Members are no longer a side benefit either. Their spending accounted for 77% of total China sales in the first half, up sharply from 60% a year earlier, giving the company a more predictable base of demand to build on.
The company’s push into proprietary intellectual property adds another layer to that story. Its YOYO brand, launched just over a year ago, has expanded into 53 countries and generated close to RMB 500 million in revenue during the first half, including a collaboration tied to Disney’s Toy Story 5. MINISO said it hit its company-wide target of RMB 1 billion in proprietary IP sales by the end of July, weeks ahead of the original year-end schedule. The payoff shows up in loyalty too. Members acquired in 2025 through IP products were retained at a rate 80% higher than non-IP members in the first half of 2026, and they purchased twice as often. TOP TOY, the company’s separate collectibles brand, grew revenue 32.7% over the same period, adding another growth lever beyond the core Miniso banner.
Overseas Growth Comes At A Cost
The costs of that expansion are showing up on the bottom line. Adjusted operating profit fell 6% year over year to RMB 1.49 billion in the first half, a decline management tied to a structural shift toward directly operated stores and away from higher-margin distributor revenue. Selling expenses climbed to 25.8% of revenue from 23.1% a year earlier, driven largely by higher rent and depreciation tied to those company-run locations. Adjusted net profit, excluding foreign exchange effects, slipped 1.7% to RMB 1.22 billion even as the top line grew by double digits.
Overseas is where the strain concentrates. Profit contribution from international markets fell from a 35% to 40% range in 2023 to just 10% to 15% in the first half of 2026, and distributor revenue across Asia and Latin America declined 10%, missing the company’s own prior guidance. North America, the largest directly operated overseas market, grew revenue 37% to RMB 1.8 billion, but same-store sales growth cooled to a mid-single-digit pace in the second quarter after stock shortages of best-selling products and a gap in new IP launches. Inventory is backing up as a result, with overseas turnover stretching to 273 days from 240 a year earlier, and management now expects full-year adjusted operating profit to decline by a high single-digit percentage as it works through the backlog.
What The Numbers Suggest
The number of hedge funds holding Miniso rose from 12 to 14 in the most recent quarter, which points to institutions adding rather than trimming positions. Short interest sits at just 2.45% of the float, a level that suggests little organized bearish conviction. The stock trades at a forward price-to-earnings ratio of 7.55 as of August 28, a multiple that prices in very little of the growth China is currently delivering. Rising fund ownership and light short interest against a single-digit earnings multiple is not the usual setup for a company navigating a bumpy overseas transition.
The Tension Still Unresolved
Miniso’s China business is proving that membership and proprietary IP can drive real growth even in a sluggish retail environment. But the overseas segment shows how expensive it is to turn that domestic playbook into profitable operations abroad. For the growth story to hold, TOP TOY and the IP strategy need to keep scaling at their current pace. For the overseas concerns to ease, distributor markets need to stabilize, and North America’s inventory issues need to clear before the next IP launch cycle.
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