Yifeng Pharmacy resumes expansion after store closures, with profit growth outpacing revenue in the first three quarters

Why did profit grow faster than revenue?

In the first three quarters of 2026, the company recorded revenue of 18.236 billion yuan, up 5.49% year on year; net profit attributable to shareholders of 1.362 billion yuan, up 10.36%; and net profit attributable to shareholders excluding non-recurring items of 1.288 billion yuan, up 13.54%.
Most stores previously closed by leading pharmacy chains generated revenue but were loss-making. Closures and slower store openings affected revenue in the short term; as loss-making stores exited and measures such as rent reductions were implemented, the positive effects on profit gradually emerged.

According to Zhongkang Data, the net decline in the number of pharmacies nationwide exceeded 3000 in each quarter of 2025; 16471 stores closed in the third quarter alone. Factors including the rollout of outpatient pooling policies falling short of expectations, market contraction, and surprise inspections related to price-comparison policies drove the wave of closures.
Guojin Securities believes leading pharmacy chains will have largely completed store closures and begun resuming expansion in 2026, with new stores and same-store improvement potentially bringing a turning point in revenue. The report also cautions that store performance improvements and the shift of prescriptions to external pharmacies may fall short of expectations.
In the first three quarters of 2026, Yifeng Pharmacy opened 369 directly operated stores, acquired 11 and closed 137, while adding 378 franchised stores. At the end of the third quarter, it had 15452 stores in total, a net increase of 621 from the end of the previous year.

Using net profit attributable to shareholders in 2025 as the base, the company’s draft 2026 restricted share incentive plan sets growth targets of at least 10% for 2026 and at least 26.5% for 2027.
Guojin Securities forecasts the company’s net profit attributable to shareholders at 1.89 billion, 2.13 billion and 2.37 billion yuan, respectively, for 2026 through 2028, representing year-on-year growth of 12%, 13% and 11%, respectively. Its assessment is based in part on the company having completed its adjustment ahead of peers and an improving same-store growth trend.