Luckin Coffee Inc. became China’s dominant coffee chain last year, outpacing the nation’s previous leader Starbucks Corp. in annual sales for the first time, reports Caixin. The Xiamen-based company posted quarterly net revenue of RMB 7.06 billion ($980 million), representing an increase of 91% from a year ago in a growing and increasingly competitive China market. Net income rose more than four times year-on-year to RMB 296.4 million in the same period.
The latest revenue figures in the three months through December brings Luckin’s total sales in 2023 to RMB 24.86 billion ($3.43 billion), surpassing Starbucks’ comparable annual sales of $3.16 billion in China, making it the biggest coffee chain in the Asian nation. Luckin’s earnings include revenue from its still small overseas operations, including 30 stores that opened in Singapore last year.
The rapid rise of Luckin comes as price-sensitive Chinese are opting for value products as the turmoil in the property market and concerns about job security dent consumer confidence. Luckin sells coffee for as little as RMB 9.9 ($1.38) a cup while most Starbucks coffee is priced at more than RMB 30.
