Atour Lifestyle Q2 Income Up 37 P.c

Atour Lifestyle Holdings(NASDAQ:ATAT) reported earnings on August 26, 2025, posting internet revenues of RMB2,469 million, up 37.4% year-over-year and adjusted internet revenue of RMB428 million, up 30.2% year-over-year. Management raised full-year internet income progress steerage to 30%, whereas individually rising retail enterprise progress expectations to 60% year-over-year. Key insights spotlight strong lodge community growth, surging retail section efficiency, and a recalibrated profitability outlook pushed by earnings combine and tax fee evolution.

Atour accelerates lodge community growth

In the primary six months of 2025, Atour opened 239 new inns, ending the second quarter with 1,824 in operation and a 29.2% YoY enhance, supported by a considerable pipeline of 816 inns as of quarter-end. Mature lodge metrics, together with income per obtainable room (RevPAR), occupancy fee (OCC), and common each day fee (ADR), remained resilient at 94.4%, 96.5%, and 97.8% of 2024 ranges, respectively, regardless of market volatility in China’s journey sector.

“By the end of the second quarter, we had a total of 1,824 hotels in operation, representing a 29.2% year-over-year increase. Meanwhile, leveraging our solid brand momentum and continuously enhanced product strength, we have been gradually building differentiated competitive edges with multiple brands and product lines that precisely target various market segments. We offer franchisees a rich and diverse range of investment options. By the end of the second quarter, the number of hotels under development reached 816. The growth of high-quality pipeline projects is viewing strong momentum toward our strategic goal of 2,000 premier hotels.”
— Haijun Wang, Founder, Chairman and CEO

This scale-driven growth, underpinned by disciplined model differentiation and strong franchise curiosity, demonstrates Atour’s capability to seize share and create a defensible pipeline in China’s fragmented lodge market, reflecting each sturdy operator popularity and systematic execution.

Retail section propels Atour income combine shift

Atour’s retail enterprise achieved gross merchandise worth (GMV) progress of 84.6% year-over-year to RMB1,144 million, with retail income accounting for round 38% of complete revenues within the first half, up from round 29% final yr, and sustaining GMV on-line channel penetration above 90%. Category innovation and flagship product launches, notably Deep Sleep Memory Foam Pillow Pro 3.0 and Thermal Regulating Comforter Pro 2.0, have pushed AtourPlanet to management positions on main e-commerce platforms.

“Fueled by ongoing strong sales of new products and the momentum from promotional campaigns, our retail business maintained robust growth this quarter with GMV rising 84.6% year over year to RMB1,144 million. Online channels continued to account for over 90% of total GMV. Our retail GMV set a new sales record during the June 18 shopping festival reaching RMB578 million, up more than 86% from the same period last year. During this promotional campaign, AtourPlanet ranked first in terms of sales in the bedding category for the first time on major third-party platforms. This breakthrough signifies that AtourPlanet’s deep sleep solutions brand positioning has further consolidated consumer mindshare.”
— Haijun Wang, Founder, Chairman and CEO

The transformation of the income combine in the direction of higher-margin, branded sleep retail not solely boosts general progress, but in addition indicators a profitable model adjacency growth unlocking multi-channel shopper monetization past the core hospitality base.

Profit margins recalibrated as income progress diversifies

Adjusted EBITDA rose 37.7% year-over-year to RMB610 million, whereas adjusted internet revenue margin declined 0.9 share factors year-over-year to 17.3%, because the retail income combine grew and withholding taxes raised the adjusted complete tax fee to 30%, in comparison with 25% final yr. Full-year adjusted internet revenue margin is now anticipated to say no year-over-year amid ongoing money return initiatives and elevated tax publicity on account of dividend and repurchase applications funded by home subsidiary internet earnings.

“In the first half of the year, retail revenue accounted for around 38% of the total, up from around 29% last year. The contribution from retail revenue continues to increase. It is exerting a structural impact on our overall net profit margin, but we have maintained a relatively stable pretax profit margin through improved management efficiency. Meanwhile, as we have officially launched a comprehensive shareholder return program combining dividend and share repurchases this year, of which the funding source comes from our net income profit distribution of our domestic subsidiaries. Accordingly, the associated withholding tax will increase our overall effective tax rate this year. The adjusted comprehensive tax rate is expected to rise to 30% this year compared to last year’s 25%. That will to some extent affect our full year net profit margin. As a result, we anticipate a year-on-year decline in full year net profit margin.”
— Haijun Wang, Founder, Chairman and CEO

While pretax profitability and money technology stay sturdy, the evolving enterprise combine and tax-related impacts require traders to recalibrate longer-term earnings expectations, significantly as return-of-capital methods amplify efficient tax headwinds.

Looking forward

Management raised full-year internet income progress steerage to 30% in comparison with 2024, with retail enterprise progress steerage set at 60% YoY. The firm reaffirmed its goal of working 2,000 premier inns by year-end, with 500 new openings deliberate, and projected 70 to 80 closures for the yr to take care of high quality requirements. No express new RevPAR or margin steerage was supplied for the rest of the yr.

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