Last Updated -
July 25, 2026
Explore the business model, global strategy, and market performance including insights into its position in China.
Chagee Holdings Limited is the Nasdaq-listed Cayman Islands holding company for CHAGEE, a premium freshly made tea drinks chain founded in China in 2017 and headquartered in Shanghai. The company operates modern teahouses built around tea-latte products, which combine brewed tea leaves with fresh milk, and presents the brand around quality, health, convenience, technology-enabled operations, and modern Chinese tea culture. Investors in its ADSs own shares in the holding company, rather than direct equity in the PRC operating entities.
Chagee has grown from a China-based tea chain into a large franchised network with a smaller overseas presence. Its model combines centralized product development, supply-chain control, digital ordering and membership systems, and franchise partners, while company-owned stores are becoming a larger part of the business. As of March 31, 2026, the network had 7,531 teahouses, including 6,741 franchised stores and 790 company-owned stores, with about 95% of locations in Greater China.
In Q1 2026, Chagee generated net revenue of RMB3.55 billion, up from RMB3.39 billion a year earlier, and total GMV of RMB7.92 billion. Franchised teahouses remained the core revenue source at RMB2.74 billion, or 77.4% of net revenue, while company-owned teahouse revenue rose sharply to RMB802.1 million. Net income was RMB447.7 million, with a 12.6% margin, and the company reported 50.0 million active members, underscoring its scale in China’s competitive premium fresh tea market.
Chagee operates a premium freshly made tea-drinks chain built around modern teahouses, tea-latte products, and a large franchise network. The company was founded in China in 2017 and listed ADSs on Nasdaq in April 2025. Investors own ADSs in Chagee Holdings Limited, a Cayman Islands holding company, rather than direct equity in the PRC operating entities.
The business model combines franchising, company-owned stores, centralized supply-chain control, brand and product development, digital ordering, and a member system. Chagee’s core product is fresh tea made with tea leaves and fresh milk, with a narrower tea-latte focus than many fruit-tea or coffee-led rivals.
Chagee generated Q1 2026 net revenue of RMB3.546 billion, up from RMB3.393 billion a year earlier. Operating income fell to RMB547.2 million from RMB820.8 million, and GAAP net income declined to RMB447.7 million from RMB677.3 million. Net margin was 12.6%, down from 20.0% in Q1 2025, showing that revenue growth came with margin pressure as competition, store mix, and operating costs weighed on profitability.
The company had 7,531 teahouses at March 31, 2026, including 6,741 franchised stores and 790 company-owned stores. Greater China remains the core market, with 7,157 teahouses, about 95.0% of the network. Greater China also generated RMB7.491 billion of Q1 2026 GMV, about 94.6% of total GMV. Overseas GMV was smaller at RMB426.4 million, but it grew 139.0% year over year.
Chagee’s market position is strongest in China’s premium fresh tea segment. The company has described itself, based on IPO and annual-report disclosures citing iResearch, as China’s largest premium freshly made tea-drinks brand by store network as of 2024. Its Q1 2026 network size gives it meaningful scale, brand visibility, supply-chain leverage, and data reach.
The competitive set is intense. Direct competitors include Mixue, Heytea, Nayuki, and Luckin Coffee. Mixue is a major China-listed mass-market tea and ice-cream chain with a larger value-oriented network, while Chagee competes at a more premium price and product position. Heytea and Nayuki are closer premium tea peers, while Luckin Coffee competes for the same beverage occasions through a coffee-led model, dense store network, and aggressive pricing.
Chagee’s main competitive advantages are its focused tea-latte identity, large franchised network, recognizable Chinese tea branding, centralized product and supply-chain systems, and large digital member base. These strengths support scale and repeat consumption, but they do not insulate the company from store saturation or price competition.
The main market-position concern is store productivity. Q1 2026 total GMV was RMB7.918 billion, but same-store GMV growth was negative 16.0% overall, negative 16.1% in Greater China, and negative 12.0% overseas. Greater China average monthly GMV per teahouse improved sequentially to RMB356,080 from RMB337,358 in Q4 2025, but it remained below the Q1 2025 level. This shows a business with strong brand scale and international growth potential, but also a domestic base facing consumer softness, high prior-year comparisons, and heavy competition.
China is Chagee’s core market. In Q1 2026, Greater China generated RMB7.491 billion of GMV, about 94.6% of total GMV, and had 7,157 of the company’s 7,531 teahouses, about 95.0% of the network. The business is built around franchised teahouses, centralized supply-chain and product development, digital ordering and a 50.0 million active member base. Its local strategy focuses on premium tea-latte products, modern Chinese tea culture, convenience and tighter operating control through a growing company-owned store base. Greater China GMV fell from RMB8.048 billion in Q1 2025, and same-store GMV declined 16.1%, showing pressure from consumer softness, store saturation and intense competition. Main rivals include Mixue, Heytea, Nayuki and Luckin Coffee. Average monthly GMV per Greater China teahouse improved sequentially to RMB356,080, but remained below year-earlier levels.
Chagee entered 2026 with strong network scale but weaker store productivity. In Q1 2026, net revenue rose to RMB3.546 billion from RMB3.393 billion a year earlier, while operating income fell to RMB547.2 million and GAAP net income declined to RMB447.7 million. Net margin narrowed to 12.6% from 20.0%, reflecting weaker Greater China GMV, heavier company-owned store costs and competitive pressure. The main turning point is that reported revenue still grew, but same-store GMV fell 16.0%, showing that expansion and mix shift are offsetting pressure in mature stores.
Chagee’s outlook depends on whether it stabilizes Greater China same-store performance while building overseas markets without eroding margins. Its RMB7.146 billion cash position and US$150 million ADS repurchase authorization provide financial flexibility, but the investment case now rests less on store count alone and more on productivity, repeat purchasing and disciplined international expansion.
This Company Profile was written by Dominik Diemer
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