Luckin Coffee Returned to Profit in Q1 as Store Count Reached 6,580

This is an English adaptation of a FoodBud historical article originally published on May 24, 2022.

FoodBud reported on May 24, 2022 that Luckin Coffee released its first-quarter results, with net revenue of RMB 2.4 billion (US$379.3 million), up 89.5% from RMB 1.2687 billion in the same period of 2021.

Revenue from freshly made beverages was RMB 1.65 billion, accounting for 68.8% of total net revenue, compared with RMB 970 million and 76.2% of total net revenue in the same period of 2021.

Profitability and Store Network

Luckin returned to profit in the first quarter, posting net income of RMB 19.8 million, compared with a net loss of RMB 230 million a year earlier.

At the end of Q1, Luckin operated 6,580 stores, including 4,675 self-operated stores and 1,905 partnership stores. During the quarter, it opened 278 self-operated stores and 278 partnership stores.

Among self-operated stores, 48% were located in office clusters and 12% were near schools.

Self-Operated Store Performance

Self-operated store revenue reached RMB 1.7 billion (US$270.5 million), up 66.2% from RMB 1.0 billion in the same period of 2021.

Same-store sales growth was 41.6%, compared with 94.5% in Q1 2021. Average monthly transacting customers reached 16.0 million, up 83.0% from 8.7 million in the same quarter of 2021.

Luckin's chairman and CEO said the company launched 34 products in the quarter. Coconut Cloud Latte sold 4.95 million cups in the week after launch. He also said self-operated and partnership stores were working well together, with partnership-store revenue contributing nearly one quarter of total revenue in Q1.

Partnership Store Revenue

According to the financial report, partnership stores generated RMB 550 million in revenue, up 239.3% year on year. This included:

• RMB 370 million from sales of raw materials
• RMB 66.1 million from profit-sharing
• RMB 58.2 million from equipment sales
• RMB 54.3 million from delivery services
• RMB 5.0 million from other services

Pandemic-Related Closures

Luckin was also affected by COVID-19 disruption in Q1 2022. In March, an average of 700 stores were closed each day. From April 1 to May 23, an average of 950 stores were temporarily closed each day.

At the end of Q1 2022, Luckin Coffee held RMB 5.0 billion in cash and cash equivalents.