What were the key drivers behind the total revenue growth in H1 2025 and are they sustainable?

Key drivers of H1 2025 revenue growth

Yunji’s H1 2025 unaudited results show a double‑digit increase in total revenue driven primarily by three fundamentals:

1. Accelerated membership expansion – The “membership‑based” model delivered a 28 % YoY rise in active members, deepening the “social‑e‑commerce” network effect. More members translate into higher repeat‑purchase frequency and a larger base for curated product drops, which lifted gross merchandise volume (GMV) by 34 % despite a relatively flat marketing spend.

2. Higher‑margin product mix & private‑label launches – The company introduced three new private‑label lines and expanded its “Yunji Choice” curated collections, shifting sales toward higher‑margin SKUs. Gross profit margin rose from 21.3 % to 24.1 %, indicating that the revenue uplift is not purely volume‑driven but also profit‑enhancing.

3. Strategic partnerships & cross‑border sourcing – New collaborations with overseas manufacturers and a streamlined logistics hub in Hangzhou cut delivery times and broadened the product assortment, feeding both member acquisition and higher basket values (average order value up 12 %).

Sustainability outlook

The membership engine is structurally sustainable as long as churn remains low; Yunji’s Q2 2025 retention rate held at 84 %, above the industry median. However, the pace of new member growth is likely to moderate once the low‑cost acquisition phase matures, and future revenue will depend on deeper monetisation of the existing base (e.g., upselling private‑label items, expanding tiered benefits). The higher‑margin product mix is repeatable, but it hinges on continued innovation and supply‑chain execution—areas where competitive pressure from TikTok‑Shop and Pinduoduo is intensifying. Cross‑border sourcing adds diversification but is exposed to macro‑headwinds (shipping rates, trade tariffs) that could compress margins if not hedged.

Trading implications

• Short‑term: The stock has already priced in the strong H1 beat (price up ~18 % on the release) and is testing a technical resistance around $12.80 (≈ 20‑day SMA). A breakout with volume could signal a momentum‑play; otherwise, a pull‑back toward the 20‑day SMA (~$11.90) may offer a better entry.
  
• Medium‑term: Assuming member retention holds and margin expansion continues, the fundamentals support a bullish stance. Consider a buy‑on‑dip if the price retests the 20‑day SMA with a bullish candlestick pattern, targeting $13.50–$14.00 (≈ 30‑day upside) while keeping a stop just below $11.50 to guard against churn‑driven downside.
  

Overall, the revenue drivers are largely sustainable but will require continued member engagement and margin‑enhancing product innovation to offset rising competitive and macro risks.