Baozun Inc.

Baozun Group total net revenues increased 7% year over year to RMB 2.7 billion in Q2 2026. E-commerce revenue grew 5% to RMB 2.3 billion, while brand management revenue rose 22% to RMB 486 million. Gross profit for product sales increased 21.3% year over year to RMB 343 million; the group-level blended gross margin for product sales was 33%, up 499 basis points. E-commerce product sales gross margin was 13% versus 12.8% last year, and BBM gross margin was 56.1% versus 52% a year ago. Non-GAAP income from operations was RMB 74 million versus RMB 6 million last year, or RMB 59 million on a rebased comparison. BEC adjusted non-GAAP operating income was RMB 107 million, while BBM reported a non-GAAP operating loss of RMB 33 million versus a loss of RMB 35 million a year ago. Working capital turnover improved to 107 days from 148 days, inventory turnover shortened to 112 days from 134 days, and cash, cash equivalents, restricted cash and short-term investments totaled RMB 2.9 billion as of June 30, 2026. For outlook, management said it remains on track for more than 50 new Gap stores in 2026 and said BBM full-year top line growth should be 20% to 25%; they did not provide companywide revenue or EPS guidance on the call.

Vincent Qiu said the quarter showed improving earnings quality, with both BEC and BBM contributing solid results in a competitive market. He emphasized that BBM’s stronger trend, along with AI experiments and infrastructure built over recent years, gave management confidence to raise the 2028 non-GAAP operating profit target to RMB 700 million. His tone was upbeat and strategic, framing AI as a lever for both productivity and long-term scalability across the group.

Catherine Zhu focused on the financial details: group revenue up 7% to RMB 2.7 billion, BEC revenue up 5% to RMB 2.3 billion, and brand management revenue up 22% to RMB 486 million. She highlighted gross margin expansion, especially BBM’s 56.1% gross margin and the 499-basis-point increase in the group blended product gross margin to 33%, while noting BEC product sales were down 10% as the company prioritized quality. On costs, sales and marketing rose to RMB 1.2 billion, but fulfillment, technology and content, and G&A all declined; she also pointed to improved working capital turnover of 107 days and cash of RMB 2.9 billion.

Analysts pressed management on the higher 2028 profit target, brand partner budgets under weak macro conditions, AI adoption effects, channel shifts, Hunter’s momentum, and whether BBM could become a bigger deal pipeline for strategic brand opportunities. Management said the revised target was driven by stronger BBM performance, AI and automation gains, and the potential to deploy those tools across BEC’s larger base. They said brand partners had not meaningfully cut budgets, but were shifting more spend toward content, traffic fees, and live-stream platforms like Douyin; on BBM, they said they are actively talking to brands but are prioritizing existing portfolio execution first.