Atour's Q3 2025: Contradictions Emerge on Retail Revenue Growth, Hotel Expansion Targets, and RevPAR Recovery

Date of Call: November 25, 2025

Financials Results

• Revenue: RMB 2,628 million, up 38.4% YOY and up 6.5% quarter-over-quarter
• Gross Margin: Hotel gross margin 37.3%, compared with 36.0% in the same period of 2024; retail gross margin stated as stable YoY
• Operating Margin: Adjusted EBITDA margin 26.1% (Adjusted EBITDA RMB 685M, up 28.7% YOY); adjusted net profit margin 18.6% (Adjusted net income RMB 488M, up 27.0% YOY)

Guidance:

• Group full-year 2025 net revenues expected to increase ~35% YOY.
• Retail revenue growth outlook raised to at least 65% YOY, contributing to the group 35% revenue target.
• Full-year openings guidance: ~500 new hotels and target of 2,000 premier hotels by year-end; ~80 hotel closures expected for 2025.
• Shareholder return: continuing dividends and buybacks, targeting payout ratio of 100% based on prior fiscal year's GAAP net income.

Business Commentary:

* Revenue Growth and Hotel Expansion: - Atour Lifestyle Holdings reported net revenues for Q3 2025 grew by 38.4% year-over-year and 6.5% quarter-over-quarter, reaching RMB 2,628 million. - The growth was driven by the ongoing expansion of the hotel network and the rapid growth of the retail business.

• Hotel Performance and Pipeline:
• In Q3 2025, Atour opened 152 new hotels, exceeding the previous quarter's record, with a total of 1,948 hotels in operation, representing a 27.1% year-over-year increase.

• This expansion was supported by a strong pipeline of 754 hotels under development, maintained through rigorous project selection and strict quality standards.

  

• Retail Business Success:

• The retail business sustained strong growth with GMV reaching RMB 994 million in Q3, reflecting a 75.5% year-over-year increase.

• The growth was attributed to increasing brand recognition, successful product innovation, and a broadened range of product offerings, particularly in the online channels.

• Shareholder Returns and Financial Strategy:

• Atour declared a second cash dividend of approximately USD 50 million for 2025, representing about 29% of last year's net income.
• The company is committed to enhancing shareholder value through dividends and share repurchase programs, with a targeted payout ratio of 100% based on the previous fiscal year's GAAP net income.

Sentiment Analysis:

Overall Tone: Positive

• Management highlighted strong top-line momentum (net revenues +38.4% YoY), retail GMV +75.5% YoY, record quarter of 152 hotel openings (1,948 total, +27.1% YoY), and concrete shareholder returns (USD ~50M dividend this round; buybacks underway and a 100% prior-year payout target).

Q&A:

• Question from Dan Chee (Morgan Stanley): Could the management share the RevPAR trend since October? And also, if it's possible, can you provide your outlook for RevPAR in the fourth quarter and also potentially next year?
  Response: RevPAR has progressively improved year-to-date; National Day saw YOY RevPAR growth driven by ADR, core-city demand remains resilient, and management expects YOY RevPAR decline pressure to ease in Q4.

• Question from Sijie Lin (China International Capital Corporation Limited): Could you please share more about the recent new hotel signing trends and whether there are any changes to the full year hotel opening and closure targets?
  Response: Signings remain quality-focused and roughly in line with last year; confident in hitting ~500 openings and reaching 2,000 hotels by year-end, with ~80 closures expected in 2025 as part of proactive network upgrades.

• Question from Xin Chen (UBS Investment Bank): Could the management share your perspective on the competition in the retail business? In addition, given the consistent overperformance of the retail business, would you consider any adjustments to your full year retail revenue guidance?
  Response: Retail competition is intensifying but Atour Planet is differentiating via product/supply-chain barriers (Deep Sleep Standard); company raised full-year retail revenue growth guidance to at least +65% YOY and adjusted group revenue guidance to +35% YOY.

• Question from Ronald Leung (BofA Securities): Could management provide an update on the planning and progress regarding shareholder returns?
  Response: Declared ~USD50M second dividend (cumulative ~USD108M this year, ~62% of prior-year net income), buyback program commenced in September; target a combined dividend+repurchase payout equal to 100% of prior fiscal year's GAAP net income over time.

• Question from Lydia Ling (Citigroup Inc.): We noticed the strong operational performance for the Atour Light in the third quarter. So could you share your plan for the Atour Light in the next steps? And any plan for accelerating the store expansion?
  Response: Focus on product and operational foundation for Atour Light; Atour Light 3.3 optimizes investment/experience, expect 170–180 Atour Light Series 3 hotels in operation by year-end and a long-term target of 1,000 hotels.

Contradiction Point 1

Retail Business Performance and Guidance

It involves the assessment of the retail business's performance and the updating of its revenue growth outlook, which directly impacts investor expectations and strategic planning.

What is your view on retail competition? Will you adjust full-year retail revenue guidance given the consistent overperformance? - Xin Chen (UBS Investment Bank)

2025Q3: Atour's retail business has overperformed, leading to raising retail revenue growth outlook to at least 65% year-on-year. - Haijun Wang(CEO)

What is the full-year revenue guidance for the retail business? What are the retail business's future development plans including new sleep product rollout pace? What development bottlenecks or challenges exist? - Xin Chen (UBS Investment Bank, Research Division)

2025Q2: Atour's retail business achieved strong performance, and we are confident in achieving the full-year target of 60% year-over-year growth. - Haijun Wang(CEO)

Contradiction Point 2

Hotel Opening and Closure Targets

It revolves around the company's projections for hotel openings and closures, which play a crucial role in understanding the growth strategy and financial planning.

Can you update recent hotel signing trends and any changes to full-year hotel opening/closure targets? - Sijie Lin (China International Capital Corporation Limited)

2025Q3: Aiming for 500 new openings and 2,000 premier hotels by year-end. - Haijun Wang(CEO)

Has the 2025 guidance on hotel openings/closures changed? Has franchise signing activity changed recently? How will growing competition affect future development plans? - Xin Chen (UBS Investment Bank, Research Division)

2025Q2: Atour is confident in achieving the full-year hotel opening guidance of 500 new hotels, reaching the target of 2,000 premier hotels. - Haijun Wang(CEO)

Contradiction Point 3

RevPAR Recovery and Market Performance

It involves the company's expectations for RevPAR recovery and market performance, which are key indicators for the hotel industry's health and strategic outlook.

Can you share the RevPAR trend since October and your outlook for Q4 and next year? - Dan Chee (Morgan Stanley)

2025Q3: Expect pressure from year-on-year decline in RevPAR to ease in the fourth quarter. - Haijun Wang(CEO)

What are the latest RevPAR trends in Q3 to date, particularly during summer holidays, and your outlook for full-year RevPAR? - Wei Ling (Citigroup Inc., Research Division)

2025Q2: RevPAR pressure in Q3 is expected to ease compared to Q2, and the full-year RevPAR recovery rate is improving gradually. - Haijun Wang(CEO)

Contradiction Point 4

Retail Revenue Growth Guidance

It involves changes in financial forecasts, specifically regarding retail revenue growth expectations, which are crucial for assessing the company's performance and growth strategy.

Could management share their view on retail competition? Given the retail segment's consistent overperformance, would you consider updating full-year retail revenue guidance? - Xin Chen (UBS Investment Bank)

2025Q3: Retail business has overperformed, leading to raising retail revenue growth outlook to at least 65% year-on-year. - Haijun Wang(CEO)

Are there any updates to the full year retail revenue growth guidance or strategic plans for retail in the coming period? - Dan Chi (Morgan Stanley)

2025Q1: Retail business achieved strong GMV growth in Q1 driven by product popularity and promotions. Full-year retail revenue growth guidance is raised to 50% YoY. - Haijun Wang(CEO)

Contradiction Point 5

Hotel RevPAR Trend and Outlook

It is important for investors to understand the trend and outlook of hotel RevPAR, which significantly impacts the company's revenue performance.

Can you share the RevPAR trend since October and your outlook for the fourth quarter and next year? - Dan Chee (Morgan Stanley)

2025Q3: RevPAR has shown a trend of progressive improvement on a year-over-year basis throughout the first 3 quarters of this year. - Haijun Wang(CEO)

Can you discuss the hotel's RevPAR performance in Q4 2025 and the contribution of the hotel business to the 25% full-year revenue guidance, along with the company's RevPAR assumption for 2025? - Dan Chi (Morgan Stanley)

2024Q4: Due to our high base effect, our full year RevPAR for 2024 decreased by 6.8% compared to 2023. In Q1 2025, we expect a year-on-year decline in Q1 RevPAR of mid- to high single digits. - Haijun Wang(CEO)