Analysis Report on the Sustainability of Haidilao's Same-Store Sales Growth

Based on the latest collected data and information, I have prepared this in-depth analysis report on the sustainability of Haidilao’s same-store sales growth after the store closures under the ‘Woodpecker Plan’.

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In 2021, Haidilao faced its first annual loss since listing, with a net loss of RMB 4.161 billion. At that time, the company’s aggressive expansion caused the number of stores to surge from over 300 in 2018 to over 1,300 in 2022, while the table turnover rate plummeted from a peak of 5.0 times per day to 3.0 times per day, leading to a sharp decline in operational efficiency [1][2].

In March 2022, founder Zhang Yong stepped down as CEO, and Yang Lijuan took over and led the promotion of the ‘Woodpecker Plan’. The main measures include:

• Closing underperforming stores
  : Shut down approximately 300 stores that failed to meet operational standards, mainly concentrated in fourth-tier and lower-tier cities
• Optimizing store structure
  : Streamlining business operations to improve single-store operational efficiency
• Launching the ‘Hard Bone Plan’
  : Reassessing and reactivating some closed stores with potential
• Opening up franchise model
  : Exploring franchise cooperation models starting from 2023

Metric	2022	2023	2024	Trend
Table Turnover Rate (times/day)	3.0	3.8	4.1	↑
Revenue (RMB 100 million)	310.39	414.35	427.26	↑
Net Profit (RMB 100 million)	13.74	44.99	47.09	↑
Same-Store Average Daily Sales (RMB 10,000)	-	-	8.68 (H1)	-

Data shows that Haidilao achieved a strong recovery in 2023, with net profit increasing by 227.33% year-on-year and table turnover rate rebounding to 3.8 times per day [1][3].

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According to Haidilao’s 1H2025 financial report, key metrics have declined significantly:

Metric	1H2024	1H2025	YoY Change
Revenue (RMB 100 million)	214.91	207.03	-3.7%
Net Profit (RMB 100 million)	20.38	17.55	-13.9%
Table Turnover Rate (times/day)	4.2	3.8	-9.5%
Same-Store Average Daily Sales (RMB 10,000)	8.68	7.83	-9.8%
Customer Footfall (100 million)	1.98	1.898	-4.2%

: The table turnover rate fell from the 2024 full-year high of 4.1 times per day to 3.8 times per day in 1H2025, while same-store average daily sales dropped nearly 10% year-on-year [4][5].

City Tier	1H2024 Table Turnover Rate	1H2025 Table Turnover Rate	Change
First-Tier Cities	4.0	3.8	-0.2
Second-Tier Cities	4.3	3.8	-0.5
Third-Tier and Below	4.1	3.9	-0.2

Table turnover rates declined across all city tiers, with the largest drop seen in second-tier cities [4].

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• The hot pot industry is in a fierce competition: 165,000 new hot pot stores opened in 2025, but 192,000 closed, resulting in a net decrease of 27,000 stores [5]
• Emerging brands such as Banu, Coucou, and Song Hot Pot are diverting customers with differentiated positioning
• Consumer behavior has shifted, with cost-effectiveness becoming the main theme. Haidilao’s customer average spending growth has nearly stagnated (per capita consumption was RMB 97.9 in 1H2025, with a YoY increase of only 1.1%)

• The ‘diaper in hot pot’ incident at the end of 2025 attracted widespread attention
• The company received administrative punishment for the ‘premature’ labeling date on takeaway sesame sauce packages
• Brand premium is being eroded by frequent negative incidents, and marketing costs increased by 23.4% year-on-year to RMB 1.087 billion [6]

• The company net closed 33 stores in 1H2025, with self-operated restaurants decreasing by 21 to 1,322
• Some stores were converted from self-operated to franchise (increasing from 1 to 41)
• The return on investment for new stores continues to decline [6]

• The founding team (Zhang Yong’s wife Shu Ping, and Shi Yonghong and his spouse) cashed out over HK$1.5 billion
• The number of funds holding Haidilao shares dropped from 25 to 5, a YoY decrease of 81.6%
• The stock price has evaporated over 80% from its 2021 peak [6]

On January 13, 2026, Zhang Yong resumed his position as CEO. Meanwhile, the company established the ‘Entrepreneurship and Innovation Committee’ and ‘Digital Operation Committee’, and introduced four core senior executives to the board of directors, forming a management combination of ‘veterans + new blood’ [1][2].

• As of June 2025, 14 catering brands have been incubated, operating 126 stores
• Revenue from other restaurants reached RMB 597 million, a YoY increase of 227%, accounting for 2.9% of total revenue
• Haidilao Food Stall became a ‘queue magnet’ in many locations after its opening in December 2025 [3][5]

• Takeaway revenue in 1H2025 increased by nearly 60% year-on-year to RMB 928 million
• Hot pot dishes with rice contributed over half of the takeaway revenue [5]

The digital middle-office construction led by Gou Yiqun is expected to improve organizational management efficiency and decision-making effectiveness.

Assessment Dimension	Score (1-10)	Weight	Weighted Score
Table Turnover Rate Trend	4	25%	1.0
Customer Footfall Change	3	20%	0.6
Competitive Landscape	4	15%	0.6
Cost Pressure	5	10%	0.5
New Business Growth	5	15%	0.75
Management Adjustment	6	15%	0.9
Comprehensive Score	-	100%	4.35

: Same-store sales growth

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• Jefferies expects the table turnover rate to be around 3.9 times, with same-store sales falling 1% year-on-year
• Net profit is expected to decrease by 11% year-on-year to RMB 2.37 billion
• Maintains a ‘Hold’ rating, with the target price lowered to HK$15.4 [7]

• Zhang Yong’s return is expected to improve strategic execution efficiency
• The multi-brand matrix still needs time to be validated
• It is necessary to monitor whether the table turnover rate can return to above 4.0 times per day

1. Consumer Demand Risk
   : Downward pressure on the macroeconomy affects catering consumption
2. Competition Risk
   : Competitors such as Banu accelerate expansion
3. Management Risk
   : Uncertainty in strategic execution after the founder’s return
4. Brand Risk
   : Sustained impact of food safety incidents on brand reputation

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Haidilao’s ‘Woodpecker Plan’ achieved remarkable results in 2023-2024, helping the company turn losses into profits. However, the performance decline in 1H2025 indicates that

:

1. Unsustainable in the Short Term
   : Both table turnover rate and same-store sales have declined year-on-year, and it is difficult to return to 2024 levels in the short term
2. Mid-Term Outlook Depends on Strategic Adjustments
   : The effectiveness of reforms after Zhang Yong’s return and the progress of new business incubation will be the key
3. Long-Term Outlook to Be Observed
   : Substantial breakthroughs in the multi-brand strategy and digital transformation will determine whether Haidilao can regain growth momentum

Haidilao is in a critical period of transformation from ‘scale expansion’ to ‘quality-focused deepening’. Investors need to closely monitor its table turnover rate recovery, new brand incubation results, and the management’s strategic execution capabilities.

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[1] Huxiu APP - “Haidilao Changes CEO” (https://www.huxiu.com/article/4826310.html)
[2] Girlfriend Finance - “Haidilao’s Tough Battle Begins! Zhang Yong Returns, Senior Management Shakeup” (https://www.163.com/dy/article/KJ6D77UQ0519RMOP.html)
[3] 36Kr - “Opening Stores Is So Difficult Now, Why Are Yum! and Others Still Expanding Frenetically?” (https://m.36kr.com/p/3602154444965126)
[4] 6park - “Haidilao’s Leadership Team Returns to Frontline, Stock Price Surges” (https://www.6park.com/news/1768398239.html)
[5] Cailianshe - “Haidilao Changes CEO” (https://www.163.com/dy/article/KJ6D77UQ0519RMOP.html)
[6] Tencent News - “Plagued by Scandals, Under Performance Pressure, Shareholder Reductions: Haidilao’s Operational Dilemmas and Hidden Worries” (https://news.qq.com/rain/a/20260109A06CUO00)
[7] Yahoo Finance - “Jefferies Maintains Haidilao’s ‘Hold’ Rating, Lowers Target Price” (https://hk.finance.yahoo.com/news/)