MIXUE GROUP (2097.HK), the parent company of the popular beverage chain, has announced a major leadership change alongside its 2025 financial results. The company's founder, Zhang Hongfu, has stepped down from his role as Chief Executive Officer (CEO). He will continue to serve as a co-chairman and executive director, participating in major corporate decisions.

Zhang Yuan, the former Executive Vice President and Chief Financial Officer (CFO), has been appointed as the new CEO. Zhang Yuan joined MIXUE GROUP in 2023, bringing extensive experience from previous roles at financial institutions including Bank of America Securities and Hillhouse Investment.

Analysts view this leadership transition from Zhang Hongfu to Zhang Yuan as a critical step for the company as it evolves from its entrepreneurial roots to a modern, corporately governed entity. The new CEO's primary challenge will be integrating sophisticated data and capital efficiency strategies into an organization historically driven by a grassroots culture, personal relationships, and intuition for the mass market.

According to its financial report, MIXUE GROUP achieved revenue of 33.56 billion yuan in 2025, a 35.2% year-on-year increase. Net profit reached 5.89 billion yuan, up 32.7% from the previous year. This performance was primarily driven by growth in sales of goods and equipment, alongside steady increases in income from franchising and related services.

As of March 25, MIXUE GROUP's share price closed at HK$322, down 5.79%, giving the company a total market capitalization of approximately HK$122.2 billion.

The new CEO, Zhang Yuan, is 35 years old and represents a new generation of leadership. With a Master's degree in Finance from Tsinghua University and a strong investment banking background, his expertise aligns with the company's post-listing needs for capital operations and market value management. Cui Haijing, who succeeds him as CFO, is a company veteran who rose through the ranks since 2009, possessing deep operational knowledge of the franchise system.

At a recent earnings briefing, Zhang Yuan stated that the management reshuffle is essentially a refinement and upgrade of existing responsibilities aimed at improving management efficiency. The company is currently accelerating its overseas store expansion and global supply chain布局, requiring capital to optimize investments in overseas factories, logistics hubs, and potential brand acquisitions.

Industry experts point out that a core challenge will be reconciling the company's grassroots franchise culture with a professional management system. The strategic adjustment's success hinges on empowering franchisees through digitalization and process optimization while preserving the original culture, demonstrating that efficiency gains lead directly to revenue increases.

The departure of Zhang Hongfu brings the founding story of the Zhang brothers back into focus. The elder brother, Zhang Hongchao, started the business in 1997 in Zhengzhou with a small cold drink stall. After initial setbacks, the brand "MIXUE Ice City" was officially established in 1999, built on the principles of affordability and high value. In 2007, his younger brother, Zhang Hongfu, left school to join the venture. Their complementary personalities—Zhang Hongchao being introverted and focused on operations and supply chain, and Zhang Hongfu being outgoing and skilled in marketing and branding—propelled the small street-side shop into rapid growth.

Under Zhang Hongfu's leadership as CEO starting in December 2017, store count exploded, reaching over 5,000 by the end of 2018. By the end of 2025, the global store count was nearly 60,000, covering countries including Indonesia, Vietnam, and South Korea. The company listed on the Hong Kong Stock Exchange in March 2025, with its share price peaking at HK$618.5 and its market cap reaching a high of HK$235.03 billion.

The brothers' wealth has surged accordingly. They were ranked 16th on the 2025 New Fortune 500 Rich List with a combined fortune of 117.94 billion yuan, making them the richest individuals in Henan province.

MIXUE GROUP, founded in Zhengzhou in April 2008, offers affordable beverages, including fruit drinks, tea, ice cream, and coffee, with an average price point of around 6 yuan. Its revenue is dominated by sales of goods and equipment, which accounted for 97.6% of total revenue (32.766 billion yuan) in 2025. Franchise and related service income contributed 790 million yuan.

Store expansion remains the core driver of growth. By the end of 2025, the group had 59,800 stores globally, including 55,300 in mainland China and 4,467 overseas. Notably, the number of overseas stores decreased by 428 compared to the previous year. The company held cash and cash equivalents, along with related financial assets, totaling 19.99 billion yuan, a significant 79.9% increase year-on-year.

This strong cash position supports MIXUE GROUP's recent forays into diversification, expanding from beverages into areas like alcoholic drinks, food service, and cultural IP. In March 2026, it established a fresh beer company. It has also piloted fresh ground coffee, launched cakes, and tested breakfast combos in several cities.

The "Snow King" IP, created in 2018, has become a central part of the brand's identity. The company has expanded its IP operations from marketing to content creation, even establishing an animation company. A flagship store model combining beverages with IP-themed merchandise has been rolled out to 23 cities in China, and plans for a "Snow King" theme park are underway.

However, challenges persist for the industry leader. In 2025, MIXUE GROUP closed 2,527 franchised stores, a 57.1% increase from 2024, indicating profitability pressures for some franchisees despite 14,496 new store openings. Its low-price strategy also presents risks; while gross profit increased to 10.452 billion yuan in 2025, the gross profit margin for goods and equipment sales declined from 31.2% to 29.9%. The company has also faced consumer complaints related to food safety and service quality.

The broader industry is experiencing a slowdown. Growth in China's new tea drink market fell to 6.45% in 2025 from 19.3% in 2023, with 157,000 tea beverage stores closing nationwide. MIXUE GROUP has adjusted its expansion policy by increasing the protected distance between new franchise stores, encouraging openings in special locations like tourist spots and transport hubs instead of dense urban areas.

Analyst ratings are mixed. UBS Group AG downgraded the stock to 'Neutral' in January, citing risks from rising ingredient costs and intense competition. In contrast, China Securities highlighted the potential for profit growth through improving franchisee margins rather than raising consumer prices.

The company acknowledges that the industry underwent significant changes in 2025, including increased subsidies from third-party delivery platforms, which heightened competition and tested digital operational capabilities. The new CEO's core task will be to balance scale, profitability, and brand reputation. The company plans to strengthen its core competencies in supply chain, brand IP, and store operations while enhancing digital capabilities and product value. Experts suggest that during this critical period of scaling efficiency and exploring diversification, stabilizing the culture, managing risks, and securing the core business are more important than aggressive expansion.