Abstract

361 DEGREES will report its quarterly results on August 18, 2026 post-Market; this preview compiles last quarter’s financials and current-quarter forecasts with segment highlights and analyst sentiment from January 1, 2026 to August 11, 2026.

Market Forecast

Consensus points to a steady revenue uptick this quarter with earnings broadly resilient, though formal marketwide EPS and net margin figures are not yet consolidated; company-level forecasts for revenue, EBIT, and EPS are unavailable. Management guidance has not been published for gross margin or net margin YoY, so we focus on run-rate trends from the latest quarter. The adult business remains the primary revenue engine, while kidswear continues to expand share on a smaller base. The most promising segment is kidswear, supported by sustained sell-through and store productivity improvements.

Last Quarter Review

361 DEGREES delivered a quarter featuring a gross profit margin of 41.57% and a net profit margin of 8.29%; net profit attributable to the parent company was RMB 0.23 billion, with quarter-on-quarter growth at 0%, while adjusted EPS and revenue YoY data were not disclosed. A key highlight was the stable profitability profile, with gross margin holding in the low-40% range. By business, adult products contributed RMB 8.59 billion and kidswear RMB 2.58 billion; inter-segment elimination was RMB -0.02 billion.

Current Quarter Outlook

Main business trajectory

Adult products remain the core contributor to the company’s revenue scale and margin stability. Recent operational discipline suggests continued focus on channel sell-through and inventory turns, which supports pricing power and mix. Given last quarter’s gross margin at 41.57%, sustained emphasis on higher-margin footwear franchises and disciplined promotions would be important to keep the margin cadence intact. We also expect continued investment in product innovation and marketing around running and basketball categories to sustain demand without materially diluting margin.

Most promising growth driver

Kidswear is poised to deliver faster growth from a smaller base. With segment revenue at RMB 2.58 billion last quarter, incremental gains could come from deeper penetration in lower-tier cities and improved wholesale order recovery. If channel partners maintain healthy inventory, kidswear assortments tied to back-to-school and seasonal campaigns may support above-company-average growth and margin accretion, particularly if apparel carry a higher blended gross margin. Execution on product refresh cycles and controlled store rollout should influence the slope of growth.

Stock-price swing factors this quarter

Margin trajectory will likely be the most influential factor for the stock near term. Investors will scrutinize whether gross margin can hold around the low-40% level amid promotional intensity across China’s sportswear market. Operating leverage is another variable; if revenue steps up while expense growth is contained, EBIT could surprise upwards, whereas heavier marketing or endorsements could cap incremental margin. Finally, wholesale order trends and retail sell-through in core categories into late summer will frame sentiment on second-half momentum.

Analyst Opinions

Most institutional commentary skews cautiously positive, emphasizing manageable discounting and stable channel inventories while acknowledging competitive intensity. Analysts with constructive views highlight the resilience of gross margin near 41–42% and the potential for kidswear to outgrow the core portfolio as assortments align with seasonal demand. The bullish camp also notes that a disciplined store network and product innovation cadence can support mid-single-digit revenue growth with relatively steady margins, while the bearish side is more concerned about industry-wide promotions and macro sensitivity. The majority view expects incremental revenue growth and stable profitability this quarter, with upside risk from operating leverage if marketing efficiency improves.