The fragrant “rejuvenation” has a shelf life of only 90 days

Introduction to Blue Shark: The Struggling Xiangpiaopiao

Author | Zhang Erhe

Editor | Lu Xucheng

On October 23, 2026, Xiangpiaopiao handed over a third quarter report with a strong sense of fragmentation.

According to financial report data, in the first three quarters, Xiangpiaopiao’s revenue was 1.860 billion yuan, a year-on-year increase of 10.47%; the net profit attributable to the parent company was 11.8343 million yuan, compared with a loss of 89.2072 million yuan in the same period last year, and the book turned a loss into a profit.

But taking the third quarter separately, the data is not so good: Xiangpiaopiao’s revenue in the third quarter was 584 million yuan, a year-on-year decrease of 10.02%; the net profit attributable to the parent company was only 974,600 yuan, a year-on-year decrease of 88.09%; non-net profit after deduction was -2.2098 million yuan, turning from profit to loss.

Three months ago, Xiangpiaopiao just handed over a semi-annual report that could be called “rejuvenation”: revenue was 1.277 billion yuan, a year-on-year increase of 23.31%, and net profit attributable to the parent company was 10.8597 million yuan. It was profitable in the first half of the year for the first time in seven years. Among them, the brewing business recorded an explosive growth of 85.31% in the first quarter.

From a sharp turnaround in the first half of the year to a single-quarter profit approaching the profit and loss line in the third quarter, the “shelf life” of Xiangpiaopiao’s “rejuvenation” is surprisingly short.

The quality of “rejuvenation”

In fact, the fact that Xiangpiaopiao Q3 stalled again may be an “illusion” in itself.

2025 is the most embarrassing year since Xiangpiaopiao went public: the annual revenue was 2.926 billion yuan, a year-on-year decrease of 11%, and the net profit attributable to the parent company was 95.2416 million yuan, a year-on-year decrease of 62.38%. It was the first time that revenue and profit dropped by double digits. On such a collapsed base line, any channel replenishment will grow into “high growth.”

Judging from specific business data, Xiangpiaopiao’s brewing revenue in the first three quarters of 2026 was 1.014 billion yuan, a year-on-year increase of 23.35%; ready-to-drink revenue was 807 million yuan, a year-on-year decrease of 3.14%. At first glance, the traditional brewing business is recovering strongly, while the “second curve” ready-to-drink business that once had high hopes is in retreat.

However, if we extend the timeline, we will find that in 2024, Xiangpiaopiao’s brewing revenue in the first three quarters was 1.110 billion yuan, which collapsed to 822 million yuan in the same period of 2025, a decrease of 25.96%; in the same period of 2026, it returned to 1.014 billion yuan. The so-called 23.35% growth is based on last year’s low base. In fact, Xiangpiaopiao’s brewing revenue in the first three quarters was nearly 100 million less than the same period last year.

This is because in 2025, in order to clear the backlog of old goods in channels and ensure the freshness of goods during the Spring Festival peak season in 2026, Xiangpiaopiao took the initiative to significantly delay the shipment pace of the brewing business. As a result, the brewing revenue in the first three quarters of 2025 fell to the lowest point in recent years and recorded a net loss attributable to the parent company of nearly 89.21 million yuan.

因而，The high growth in the first half of 2026, to a certain extent, is a replenishing shipment to this artificially low base, rather than a substantial expansion of terminal consumer demand.

When the low base effect subsided, the true terminal sales level was exposed: in the third quarter of 2026, brewing revenue was 346 million yuan, down 13.14% year-on-year; ready-to-drink revenue was 228 million yuan, down 5.64% year-on-year. The two major businesses rarely stalled at the same time.

In this regard, the explanation given by Xiangpiaopiao is: “seasonal off-season” and “active channel optimization”, and the institutional research report also characterized it as a “short-term disturbance”.

But if the real demand after excluding the base effect is solid enough, the off-season will not compress single-quarter profits to one million yuan. In other words, “rejuvenation” is the repair at the report level, and “recession” is the background at the terminal level.

Both wheels stall simultaneously

It is worth noting that the most dangerous signal for Xiangpiaopiao is not that the brewing business has fallen again, but that the ready-to-drink business cannot hold on.

In the past few years, Xiangpiaopiao’s strategy has been almost based on the switch of “brew out and ready-to-drink in”. The original intention was to use the summer and autumn peak seasons of ready-to-drink products to offset the winter and spring peak seasons of brewing and smooth out seasonal fluctuations. Therefore, when in the first three quarters of 2025, ready-to-drink revenue was 833 million yuan, exceeding brewing revenue of 822 million yuan for the first time, the market once cheered that “the second curve overtakes the basic market.”

However, this overtake itself was accidental. When brewing shipments returned to normal in 2026, ready-to-drink products not only failed to continue to expand their results, but showed signs of decline.

Specifically from the data performance, in the first half of 2026, Xiangpiaopiao’s ready-to-drink business revenue was 579 million yuan, a year-on-year decrease of 2.11%. This is the first time that the business has declined in the semi-annual report since it was independently disclosed in 2023. Among them, in the second quarter of 2026, the revenue of this business was 281 million yuan, a year-on-year decrease of 13.5%. By the third quarter of 2026, the revenue of this business was 228 million yuan, a year-on-year decrease of 5.64%.

As we all know, the second and third quarters are the absolute peak seasons for beverages and the only window for the ready-to-drink business to prove itself. However, Xiangpiaopiao has experienced negative growth for two consecutive peak seasons.

This means that Xiangpiaopiao’s two-wheel drive has slipped from “one-off growth” to “simultaneous contraction”, and ready-to-drink beverages have not yet proven that they can support growth independently outside of brewing.

Xiangpiaopiao also admitted in its semi-annual report: “The ready-to-drink business is still in the market investment period and still requires more time and resource investment. The company’s single product situation will continue to exist for a period of time.”

Why stall?

To a certain extent, Xiangpiaopiao happened to hit the background of the decline of the beverage industry.

Maoying data shows that in the second quarter of 2026, offline sales of the domestic beverage category fell by 11.78% year-on-year, ranking among the top categories of fast-moving consumer goods. Data from the National Bureau of Statistics show that in the first half of 2026, the output of beverage companies above designated size nationwide was 90.273 million tons, a year-on-year decrease of 0.5%, which was the first semi-annual negative growth in the past five years.

However, this is not a collective decline in the entire industry, but a drastic category switch. According to the 2026 Q2 offline retail monitoring data of Mawin, sugar-free ready-to-drink tea increased by 16.1% year-on-year, sugar-containing ready-to-drink tea fell by 11.17% year-on-year, ready-to-drink juice fell by 14.84% year-on-year, and carbonated drinks fell by 12.23% year-on-year… Among the nine typical beverage categories, only sugar-free tea and ready-to-drink coffee showed positive growth.

Xiangpiaopiao’s main ready-to-drink categories: Meco cup fruit tea and Lan Fong Yuen Hong Kong-style milk tea, are among the two categories with the sharpest decline: sugary tea and fruit juice.

What’s even more troublesome is that these two categories are crowded with powerful competitors: for example, old players such as Master Kong, Uni-President, Nongfu Spring, Dongpeng, and China Resources C’estbon, which have been developing channels for 20 years, as well as similar products that have been conveniently extended by new tea drinks such as Heytea, Naixue, Ancient Ming, and Jasmine Milk White. Xiangpiaopiao does not have the channel density of Nongfu Spring, nor the price/performance ratio of Master Kong and Dongpeng. The product taste itself also lacks an irreplaceable differentiation label.

Xiangpiaopiao stands at the intersection of the fastest shrinking category and the most crowded track at the same time, and does not have a differentiation card in hand.

Xiangpiaopiao’s original pillar business, the “convenience” scene on which brewing milk tea relies, is also being systematically dismantled by instant retail and freshly made tea.

“2026 China Tea Drinking and Coffee Data Insights” shows that in the past year, the tea drinking industry has opened more than 170,000 new stores, closed more than 130,000 stores, and has more than 370,000 stores in operation; the net increase of coffee stores has exceeded 50,000, and there are more than 220,000 stores in operation. This means that with the expansion of ready-made tea stores, the convenience of “ordering a cup” in most urban consumption scenarios is no longer significantly lower than “making a cup.”

The maturity of takeout platforms and instant retail has further smoothed the final time gap: the cost and convenience of consumers drinking a cup of freshly made milk tea within 30 minutes have made the process of “boiling water – brewing – stirring – cleaning” of brewing products redundant. The core scenarios for brewing milk tea in the past (dormitories, offices, home stores) are being taken over one by one by takeout and instant retail.

This means,Xiangpiaopiao’s opponent is not another cup of brewed milk tea, but an instant beverage supply system that is faster and fresher than it, and has developed consumption inertia.

Under this logic, the 13.14% decline in Xiangpiaopiao brewing business in the third quarter should not be simply regarded as the result of “off season” or “channel adjustment”. The off-season is seasonal, but the migration of consumption scenes is trendy. Some institutional research reports regard Xiangpiaopiao’s Q4 peak season and the 2027 Spring Festival as the reason for “flexibility.” However, what can be repaired in the peak season is the seasonal shipment rhythm, and it cannot repair the long-term trajectory of a category being marginalized in consumers’ daily lives.

A deeper concern lies on the cost side. In the first three quarters of 2026, Xiangpiaopiao’s R&D expenses fell by 24.93% year-on-year, continuing the 25.61% decline reported in the first half of the year.Under the dual pressure that brewing needs to rely on product upgrades (original leaf fresh brewing, ancient health-preserving recipes) to retain existing users, and ready-to-drink products need to rely on new products to open up the situation, cutting R&D investment is a dangerous short-termism.

Although the sales expense ratio dropped by 4.84 percentage points to 21.20%, the impact of cost control on profits is real, but it cannot restore growth momentum. When a consumer goods company relies on “spending less” to maintain small profits, rather than relying on “selling more” to create profits, the quality of its operations needs to be questioned.

The channel side is also shrinking. According to the main operating data disclosed by Xiangpiaopiao in the first three quarters of 2026, at the end of the reporting period, there were 1,679 Xiangpiaopiao dealers, an increase of 265 and a decrease of 289 during the period, with a net decrease of 24. Dealer revenue fell 8.8% year-on-year in the third quarter, and e-commerce channels fell 18.2%. In this regard, Xiangpiaopiao explained it as “optimizing the dealer structure and eliminating inefficient customers.”

But when channel inventory is already at a low level and the number of dealers has been “downsized,” the next step of growth must come from end consumers voting with real money, and the third quarter data shows that Xiangpiaopiao did not receive consumer votes.

What Xiangpiaopiao needs is not “rejuvenation”

The most brilliant advertising slogan of Xiangpiaopiao is “More than 300 million cups are sold a year, and the cups could circle the earth together.” As of today, the cup has been able to go around 66 times. From 2012 to 2025, it has ranked first in the cup-filled milk tea market share for 14 consecutive years. But this “first” was taken from an ever-shrinking pool.

When the core scene of brewing milk tea is being eaten up bit by bit by 370,000 freshly made stores and freshly made milk tea; and as the “second curve” of the ready-to-drink business, it happens to fall into the two fastest-growing subcategories of sugary tea and juice, and it faces opponents that it cannot beat. What should Xiangpiaopiao do?