Revenue doubled, with an 82% gross profit margin—how much is Lin Qingxuan's report card truly worth?

Ask AI · Can Lin Qingxuan’s high gross margin offset marketing expense pressure?

Recently, Lin Qingxuan released its first annual report since going public. Revenue reached 2.45 billion yuan, a year-on-year increase of 102.5%; adjusted net profit was 401 million yuan, also up 100.1% year-on-year. Both indicators have doubled. The most striking figure is the gross margin. By 2025, Lin Qingxuan’s gross margin reached 82.4%. This level places it in the first tier of domestic beauty brands, higher than both Maogeping and Baitai Ni, and it also surpasses international brands like L’Oréal and Estée Lauder.

How did they achieve such a high gross margin? The financial report reveals two key factors: first, the pricing power of the camellia series, and second, the increase in the proportion of direct online sales. By 2025, online channel revenue grew by 141.32% year-on-year, marking the first time it accounted for over 70% of total revenue. However, a high proportion of online sales also means rising marketing expenses. In 2025, marketing expenses reached 1.397 billion yuan, a year-on-year increase of 103.1%, with a marketing expense ratio of 57%. This means that for every 100 yuan the company earns, 57 yuan is spent on marketing. This ratio is relatively high in the beauty industry.

Looking at research and development, in 2025, R&D expenses were 46.8 million yuan, up 53.9% year-on-year. The R&D expense ratio was 1.9%, down from 3.06% in 2022. Compared to international brands with R&D expense ratios around 5%, there is indeed a gap. However, when compared horizontally within domestic beauty brands, 1.9% is not particularly low; many local brands have long operated between 1% and 2%.

As for profit, in 2025, adjusted net profit was 401 million yuan, with a net profit margin of 16.37%. This is a slight decline from 16.66% in 2024, but overall it remains stable. This indicates that although marketing investment is high, the gross margin is sufficient, and profit margins have not been significantly compressed. The change in inventory is also noteworthy, with an inventory balance of 305 million yuan at the end of 2025, more than doubling from 141 million yuan in 2024. The growth rate of inventory outpaced that of revenue, with turnover days increasing from 63 to 78 days. The company explained that this was to prepare for sales growth, but how quickly the inventory is digested will depend on subsequent data.

For a newly listed high-end domestic brand, this approach has clearly proven effective in the first year after its IPO.