Li-Ning’s latest earnings exceeded expectations. In 2025, the company’s revenue rose 3.2% year over year to RMB 29.598 billion (USD 4.3 billion), while net profit attributable to equity holders reached RMB 2.936 billion (USD 425.6 million), for a net margin of 9.9%. Gross margin fell 0.4 percentage points from a year earlier to 49%, while return on equity attributable to equity holders declined by one percentage point to 10.9%.
The company said revenue growth was driven mainly by faster expansion in its performance categories. During the reporting period, its three major categories, running, basketball, and training, accounted for 64% of retail sales, while professional product revenue made up more than 56%.
Li-Ning said the decline in margin was mainly due to a higher effective tax rate, changes in channel mix, and heavier discounting as promotional competition intensified in directly operated channels.
After more than two years of business adjustments, Li-Ning’s external messaging appears to have become more assertive. At the earnings briefing, co-CEO Takeshi Kosaka, formerly referred to as Qian Wei, still emphasized the need to maintain a posture of challenge rather than tasking risks. But he also told 36Kr that the company would nonetheless assess opportunities across subsegments with stronger execution and a greater willingness to invest where there is room to expand.
Helped by its earnings results, Li-Ning’s stock rose more than 13% intraday on March 20, the day of the briefing, and closed up 8.5% at HKD 21.44 (USD 2.7) per share, giving the company a market capitalization of about HKD 55.4 billion (USD 7.1 billion). The stock has edged slightly higher since then.
Running leads growth, while badminton gains scale
A closer look at Li-Ning’s business shows that running was a key growth driver.
Over the past year, Li-Ning expanded its “Boom” technology platform with the “Super Boom” capsule. Supported by its professional positioning, retail sales in running rose 10% year-on-year (YoY) in 2025. The category’s share of retail sales increased from 16% five years ago to 31%. Sales of professional running shoes exceeded 26 million pairs, including more than 11 million pairs from new releases under its three flagship running shoe lines: Feidian, Chitu, and Super Light.
The broader running market remains competitive. In 2025, Nike launched the Vomero series as a flagship cushioned running shoe, while Adidas reported 30% growth in its running category, partly driven by the Adizero line.
Kosaka said Li-Ning’s running category has gained only a relative advantage over the past few years and that the company cannot afford to relax. He said Li-Ning wants to become consumers’ preferred running brand.
Li-Ning also reported strong growth in badminton, where 2025 revenue rose 30% YoY and accounted for about 7% of total revenue, a record high for the category.
According to a national survey on sports participation in China, badminton is the country’s second most popular mass fitness activity after walking. Yonex said in its fiscal 2025 earnings report that annual per capita spending on badminton in China has risen from RMB 300 (USD 43.5) a decade ago to nearly RMB 3,000 (USD 434.8).
As a racket sport, badminton depends heavily on equipment, which is central to product differentiation. Over the past few years, Li-Ning has reworked the product mix in the category. Three to four years ago, apparel accounted for 60–70% of badminton revenue. Now, rackets, strings, and shoes make up about 85%. In the past year alone, Li-Ning sold 5.5 million badminton rackets.
Kosaka said Li-Ning’s badminton business is no longer just following demand, but shaping it. He added that given the category’s size limits, the company will focus on improving operating efficiency while maintaining orderly growth.
Some segments remain under pressure
Despite growth in running and badminton, Li-Ning’s retail sales in basketball and sport lifestyle fell 19% and 9%, respectively.
Executives said the basketball category had previously suffered from pricing disorder during its expansion, which weakened product competitiveness. In response, Li-Ning has spent the past two to three years controlling volume and inventory in basketball, leading to a temporary decline in the category’s share of business.
Even so, Kosaka said the company does not expect the downturn to last indefinitely and wants to be in position to gain market share when demand recovers.
Li-Ning also appears to be recalibrating its lifestyle business. After the peak of the guochao revival, the company spent an extended period trying to balance sports credibility with fashion-driven demand.
At the latest earnings briefing, Kosaka said excessive reliance on trends is not sustainable for a professional sports brand, and that Li-Ning had therefore exercised tighter control over its sport lifestyle business.
At the same time, he acknowledged that lifestyle sportswear remains closer to the mass market and continues to serve as a foundation for sports brands. He added that Li-Ning still intends to develop this area.
One notable move during the reporting period was Li-Ning’s collaboration with Chinese table tennis player Wang Chuqin. The partnership may suggest the company is trying to use its sports resources to give trend-oriented products a clearer athletic identity.
In outdoor, a fast-growing segment for many sportswear brands, Li-Ning appears to still be testing its approach. Last December, it opened a dedicated outdoor store in Beijing under the Counterflow banner. Kosaka said the store remains in a trial phase. He added that if outdoor products are to become a standalone category, the current product mix is not yet broad enough.
Operational discipline gives Li-Ning room to invest
After several years of adjustment, Li-Ning appears to be in a stronger position to pursue growth under a unified brand strategy.
One metric investors continue to watch closely is inventory management. As of the end of last year, Li-Ning’s inventory turnover days stood at 64, unchanged from a year earlier. Inventory held for less than six months accounted for about 85% of total inventory, while the all-channel inventory-to-sales ratio remained stable at four months.
As of December 31, 2025, Li-Ning’s total number of points of sale had increased by a net 24 to 7,609. Against a weak offline consumption backdrop, the company closed 59 directly operated stores over the previous year. It also accelerated the buildout of outlet channels in higher-tier markets to improve operating efficiency.
In youth wear, the number of “Li-Ning Young” stores rose from 50 at the end of 2024 to 1,518. Online, e-commerce retail sales posted low-single-digit growth.
These measures helped reduce selling and distribution expenses as a share of revenue by 1.1 percentage points to 31%, while operating margin rose from 12.8% to 13.2%. Even with pressure on gross margin, the company’s core business remained profitable.
During the reporting period, Li-Ning’s total cash balance, including time deposits, reached RMB 19.973 billion (USD 2.9 billion), up RMB 1.833 billion (USD 265.7 million) from 2024. That cash position gives the company more flexibility for long-term investment.
Last year, Li-Ning regained the Chinese Olympic Committee partnership rights from Anta. At the end of 2025, it opened a flagship store in Beijing’s Taikoo Li Sanlitun and launched the “Glory Gold Label” series, marking the first time the Chinese Olympic Committee’s commercial emblem and the Li-Ning logo had appeared together on products.
Discussing the new store format, Kosaka said overall store productivity had exceeded internal expectations. He added that the company is expanding the product line and preparing to open a new store in a prime commercial district in Shanghai.
At the recently concluded Winter Olympics, Li-Ning gained another visibility boost. According to Guojin Securities, the Chinese sports delegation wore Li-Ning gear during the opening ceremony, giving the brand high-profile exposure. Guojin Securities also said it remains optimistic about Li-Ning’s performance in 2026 and expects the increase in visibility to support results for the full year.
Kosaka also said the CEO of the joint venture handling overseas business took office in the second half of last year. Although the joint venture has been removed from the listed company’s financial reporting system, he said its business is still growing and will contribute to the broader company’s performance.
Li-Ning still faces long-term challenges, but its latest results suggest it is entering its next phase with firmer operating control, clearer category priorities, and more confidence in where to invest.
KrASIA features translated and adapted content that was originally published by 36Kr. This article was written by Xie Yunzi for 36Kr.
Note: HKD, RMB figures are converted to USD at rates of HKD 7.83 = USD 1 and RMB 6.90 = USD 1 based on estimates as of March 25, 2026, unless otherwise stated. USD conversions are presented for ease of reference and may not fully match prevailing exchange rates.