With 50,000 Stores and 2.7 Billion RMB Revenue, How Fast Can Mixue Bingcheng Still Grow?

Mixue Bingcheng: A Behemoth With Billions in Revenue and 53,000 Stores Faces Its Toughest Challenges Yet

Following strong earnings reports from sector peers, Chinese beverage giant Mixue Bingcheng has delivered impressive results.

On August 27, the company released its first semi-annual report since its IPO, revealing powerful growth. For the first half of 2025, Mixue reported:

Revenue: ¥14.88 billion (approx. $2.05B USD), a 39.3% year-over-year increase.

Profit: ¥2.72 billion (approx. $375M USD), a 44.1% year-over-year increase.

This explosive growth is driven by relentless store expansion. As of June 30, Mixue operates over 53,000 stores globally—an increase of nearly 10,000 locations in just one year. This translates to an average of 27 new stores opening every single day.

However, while the company's performance proves its scale model is far from C, “Snow King"—as the brand's mascot is known—is not without its problems. Beneath the surface, Mixue faces declining profitability per store and a rising tide of food safety crises. Can its low-cost empire continue to thrive?

1. How Sustainable Is Mixue's Profit Machine?

When Mixue went public on the Hong Kong Stock Exchange, its massive 45,000-store footprint raised a key question for investors: had the company already hit its growth ceiling?

The latest report suggests the profit engine is still running strong. Gross profit for the first half of 2025 grew 38.3% to ¥4.71 billion. Interestingly, the gross margin on selling goods and equipment to franchisees dipped slightly from 30.5% to 30.3% due to higher raw material costs. However, the margin on franchise fees and services rose from 81.7% to 82.7%, a direct benefit of its massive scale.

Having already surpassed Starbucks in store count to become the world’s largest beverage chain by locations, Mixue continues to push its domestic advantage. A staggering 57.6% of its nearly 50,000 mainland China stores are in third-tier cities and below, establishing a dominant presence in every corner of the country’s sinking market. Meanwhile, only 4.9% of its stores are in first-tier cities, signalling major room for growth in urban centres.

A key to Mixue's profitability is its remarkably low marketing spend. The brand's mascot, "Snow King," has become a cultural icon in China, achieving a viral IP status that drives enormous organic traffic. The character is so recognizable that it significantly shortens the customer's decision-making process. The "Mixue Bingcheng" topic on Douyin (China's TikTok) has accumulated over 54 billion views. This brand power reduces the need for expensive advertising campaigns.

2. The Race for 10,000 Stores: Can Lucky Cup Challenge the Coffee Kings?

While Mixue's overall store count grew, its international footprint quietly shrank from 4,895 to 4,733 stores in the year's first half. The company stated this was a strategic "optimization" of existing stores in key markets like Indonesia and Vietnam. Expansion remains on the agenda, with a new store opening in Kazakhstan signalling a push into Central Asia.

Beyond its main brand, Mixue is betting on its coffee subsidiary, Lucky Cup, to create a second engine for growth.

Originally an independent brand that struggled, Lucky Cup was fully acquired by Mixue and rebranded to mirror its parent company’s strategy: rock-bottom prices. Targeting the same low-cost market as coffee giants Luckin and Cotti, Lucky Cup has aggressively expanded. Building on its strength in lower-tier cities, the brand is now pushing into major urban centres.

To fuel this expansion and hit an ambitious internal target of 10,000 stores by year-end, Lucky Cup is offering significant incentives to new franchisees in top cities like Beijing and Shanghai, including waiving two years of franchise and management fees—a discount worth ¥34,000 (approx. $4,700 USD) per store.

As of late July, Lucky Cup had reached 7,000 locations, meaning it needs to open another 3,000 stores—or 600 stores per month—to hit its year-end goal.

3. The Cracks in the Empire: Declining Store Revenue and Food Safety Scandals

Despite its scale, concerning trends are appearing at the franchisee level.

The number of Mixue store closures is rising significantly. In the first half of 2025, 1,187 stores shut down, a 48.6% increase from the 799 closures during the same period last year. This trend points to a critical underlying issue: declining single-store profitability.

While the latest report omitted this data, Mixue’s IPO filings show that the average daily retail sales per store have been falling. This suggests that while top-performing franchisees with multiple stores may still be profitable, smaller owner-operators are feeling the financial squeeze of market saturation.

Since Mixue’s primary revenue comes from selling supplies to its franchisees, a rising number of closures directly threatens its business model.

In response, Mixue is taking action. It has significantly increased the “protection zone” between stores from as little as 200 meters to a uniform 1,000 meters, a move designed to prevent new locations from cannibalizing sales from existing ones.

Furthermore, the brand is plagued by frequent food safety incidents. In the last three months alone, Mixue has been cited for:

Flies were found in a drink.

A cockroach was found in a sealed beverage.

Excessive bacteria levels at a Hong Kong location.

Remarkably, these scandals have not dented Mixue’s soaring profits. The brand’s ultra-low prices have given it a level of public tolerance that other brands would not enjoy. However, this goodwill is not unlimited and erodes consumer trust over time.

Mixue’s strong cash flow and world-class supply chain give it a powerful foundation for continued growth. However, the company’s future success will depend on its ability to solve two critical problems: ensuring its franchisees can remain profitable and fixing its systemic food safety issues. After all, even the largest giant can’t afford to ignore the base it stands on.