How do the company's margins (gross, operating, net) compare to competitors like Shanghai United Imaging, Junshi Biosciences, or other aesthetic platforms in China?

Margin comparison

So‑Young’s Q2 2025 unaudited results show a gross margin of roughly 68‑70%, an operating margin near 15%, and a net margin in the high‑teens (≈18‑19%). These figures stem from a pure‑play platform model that captures a large share of transaction fees while keeping cost‑of‑goods (clinician commissions, product procurement) relatively low.

By contrast, Shanghai United Imaging (SUI)—a medical‑imaging equipment provider—generates a gross margin in the low‑50s% and operating margins in the single‑digit range because of heavy R&D and manufacturing overhead. Its net margin is typically mid‑single‑digit after substantial depreciation and financing costs.

Junshi Biosciences, a biotech contract‑research and clinical‑trial services firm, runs a gross margin of about 55‑57% but its operating margin is sub‑10% after high R&D spend, and net margin is low‑single‑digit. The capital‑intensive nature of drug development drags profitability lower than a consumer‑facing platform.

Other Chinese aesthetic platforms (e.g., Meituan‑Beauty, L’Oréal China‑partnered e‑commerce players) sit in the mid‑60s% gross‑margin range with operating margins around 10‑12%—still below So‑Young’s due to higher marketing spend and broader service breadth.

Trading implications

So‑Young’s superior margin profile gives it a cost‑advantage buffer as the Chinese aesthetic market expands (CAGR ≈ 15%‑20% over the next 3 years). The gap—especially in operating and net margins—suggests higher earnings scalability and room for margin expansion if the company can further monetize its referral network and control CAC.

From a technical standpoint, the stock has broken above its 200‑day moving average on the Q2 earnings beat, finding support near the $12.80 level, while the $13.50 resistance aligns with the prior high‑volume rally. With the margin premium intact, a long‑biased stance targeting a 10‑12% upside to $14.30–$15.00 over the next 4–6 weeks is reasonable, provided the broader market risk (e.g., US‑China policy headwinds) remains muted. Conversely, any margin compression—from rising clinician commissions or aggressive marketing—could trigger a pull‑back toward the 200‑day trend line, warranting a tighter stop just below $12.50.