YSG

Conference Call to Be Held at 7:30 A.M. U.S. Eastern Time on September 2, 2026 GUANGZHOU, China, Sept. 2, 2026 /PRNewswire/ -- Yatsen Holding Limited ("Yatsen" or the "Company") (NYSE: YSG), a leading China-based beauty group, today announced its unaudited financial results for the quarter ended June 30, 2026. Second Quarter 2026 Highlights Total net revenues for the second quarter of 2026 increased by 5.1% to RMB1.14 billion (US$168.3 million) from RMB1.09 billion for the prior year period. Total net revenues from Skincare Brands[1] for the second quarter of 2026 increased by 40.4% to RMB816.1 million (US$120.3 million) from RMB581.3 million for the prior year period. As a percentage of total net revenues, total net revenues from Skincare Brands for the second quarter of 2026 were 71.5%, as compared with 53.5% for the prior year period. Gross margin for the second quarter of 2026 decreased to 73.9% from 78.3% for the prior year period. Net loss for the second quarter of 2026 was RMB90.8 million (US$13.4 million), as compared with RMB19.5 million for the prior year period. Non-GAAP net loss[2] for the second quarter of 2026 was RMB99.4 million (US$14.7 million), as compared with non-GAAP net income of RMB11.5 million for the prior year period. Mr. Jinfeng Huang, Founder, Chairman and Chief Executive Officer of Yatsen, stated, "China's beauty market demonstrated broad resilience in the second quarter, with market growth showing slight improvement but remaining challenged as competition across the industry intensified. Against this backdrop, our business continued to navigate a critical phase of strategic transformation. As we further optimized our brand portfolio and distribution channels, our skincare portfolio maintained its strong growth momentum — now representing over 70% of total revenues — led by the robust performance of our clinical and premium skincare brands, including Galénic, DR.WU and Eve Lom. In contrast, our color cosmetics segment faced structural headwinds amid heightened competition. As a result, we are taking decisive actions to streamline our color cosmetics portfolio and refocus resources on our high-growth skincare brands. Looking ahead, we aim to further optimize our product portfolio and channel execution, while maintaining investments in R&D to strengthen our innovation pipeline for sustainable long-term growth." Mr. Donghao Yang, Director and Chief Financial Officer of Yatsen, commented, "We delivered modest top-line growth in the second quarter of 2026, with net revenues increasing 5.1% year over year. This performance was primarily driven by a 40.4% year-over-year growth in our skincare segment, which more than offset revenue pressure in our color cosmetics business. Looking ahead, amid dynamic market conditions, we remain committed to maintaining operational discipline, with a continued focus on improving marketing spend efficiency and progressively optimizing our operating cost structure." Second Quarter 2026 Financial Results Net Revenues Total net revenues for the second quarter of 2026 increased by 5.1% to RMB1.14 billion (US$168.3 million) from RMB1.09 billion for the prior year period. The increase was primarily driven by a 40.4% year-over-year increase in net revenues from Skincare Brands, which more than offset a 35.8% year-over-year decrease in net revenues from Color Cosmetics Brands.[3] Gross Profit and Gross Margin Gross profit for the second quarter of 2026 decreased by 0.8% to RMB843.8 million (US$124.4 million) from RMB850.4 million for the prior year period. Gross margin for the second quarter of 2026 decreased to 73.9% from 78.3% for the prior year period, primarily due to higher inventory provisions in the color cosmetics business associated with the Company's proactive brand portfolio optimization and SKU rationalization. Operating Expenses Total operating expenses for the second quarter of 2026 increased by 7.7% to RMB975.7 million (US$143.8 million) from RMB905.9 million for the prior year period. As a percentage of total net revenues, total operating expenses for the second quarter of 2026 were 85.4%, as compared with 83.4% for the prior year period. Fulfillment Expenses. Fulfillment expenses for the second quarter of 2026 were RMB56.1 million (US$8.3 million), as compared with RMB63.3 million for the prior year period. As a percentage of total net revenues, fulfillment expenses for the second quarter of 2026 decreased to 4.9% from 5.8% for the prior year period. The decrease was primarily attributable to further improvements in logistics efficiency. Selling and Marketing Expenses. Selling and marketing expenses for the second quarter of 2026 were RMB807.6 million (US$119.0 million), as compared with RMB722.4 million for the prior year period. As a percentage of total net revenues, selling and marketing expenses for the second quarter of 2026 increased to 70.7% from 66.5% for the prior year period. The increase was primarily driven by strategic investments in broadening consumer awareness and building long-term brand equity of our core skincare brands, coupled with higher traffic acquisition costs on the Douyin platform as the Company capitalized on the channel's strong growth momentum. General and Administrative Expenses. General and administrative expenses for the second quarter of 2026 were RMB74.8 million (US$11.0 million), as compared with RMB84.1 million for the prior year period. As a percentage of total net revenues, general and administrative expenses for the second quarter of 2026 were 6.6% as compared with 7.7% for the prior year period. The decrease was primarily driven by lower share-based compensation expenses. Research and Development Expenses. Research and development expenses for the second quarter of 2026 were RMB37.3 million (US$5.5 million), as compared with RMB36.1 million for the prior year period. As a percentage of total net revenues, research and development expenses for the second quarter of 2026 were 3.3%, consistent with the prior year period. Loss / Income from Operations Loss from operations for the second quarter of 2026 was RMB131.9 million (US$19.4 million), as compared with RMB55.5 million for the prior year period. Operating loss margin was 11.5%, as compared with 5.1% for the prior year period. Non-GAAP loss from operations[4] for the second quarter of 2026 was RMB112.1 million (US$16.5 million), as compared with RMB20.4 million for the prior year period. Non-GAAP operating loss margin[5] was 9.8%, as compared with 1.9% for the prior year period. Net Loss / Income Net loss for the second quarter of 2026 was RMB90.8 million (US$13.4 million), as compared with RMB19.5 million for the prior year period. Net loss margin was 8.0%, as compared with 1.8% for the prior year period. Net loss attributable to Yatsen's ordinary shareholders per diluted ADS[6] for the second quarter of 2026 was RMB0.97 (US$0.14), as compared with RMB0.19 for the prior year period. Non-GAAP net loss for the second quarter of 2026 was RMB99.4 million (US$14.7 million), as compared with non-GAAP net income of RMB11.5 million for the prior year period. Non-GAAP net loss margin was 8.7%, as compared with non-GAAP net income margin of 1.1% for the prior year period. Non-GAAP net loss attributable to Yatsen's ordinary shareholders per diluted ADS[7] for the second quarter of 2026 was RMB1.06 (US$0.16), as compared with non-GAAP net income attributable to Yatsen's ordinary shareholders per diluted ADS of RMB0.13 for the prior year period. Balance Sheet and Cash Flow As of June 30, 2026, the Company had cash, restricted cash and short-term investments of RMB1.06 billion (US$155.6 million), as compared with RMB1.05 billion as of December 31, 2025. Net cash used in operating activities for the second quarter of 2026 was RMB78.0 million (US$11.5 million), as compared with net cash generated from operating activities of RMB77.7 million for the prior year period. Appointment of Co-Chief Financial Officer The Company is pleased to announce the appointment of Ms. Li Wang as Co-Chief Financial Officer, effective September 2, 2026. Ms. Wang brings over 15 years of experience in the consumer industry, having previously served as Chief Financial Officer at Proya Cosmetics Co., Ltd. and holding multiple professional accounting qualifications, including CMA, HKICPA and FIPA. Ms. Wang will partner with Mr. Donghao Yang, the Company's Director and Chief Financial Officer, to ensure a seamless transition and provide continuity in the Company's financial leadership, and she is expected to succeed Mr. Yang as Chief Financial Officer after the release of the 2026 annual report on Form 20-F. The appointment reflects the Company's commitment to building a world-class leadership team and will further support the Company's ongoing strategic transformation and its focus on sustainable, profitable growth. Business Outlook For the third quarter of 2026, the Company expects its total net revenues to be between RMB898.6 million and RMB998.4 million, representing a year-over-year decrease of approximately 0% to 10%. These forecasts reflect the Company's current and preliminary views on the market and operational conditions, which are subject to change. Exchange Rate This announcement contains translations of certain Renminbi ("RMB") amounts into U.S. dollars ("US$") at specified rates solely for the convenience of the reader. Unless otherwise noted, all translations from RMB to US$ were made at a rate of RMB6.7851 to US$1.00, the exchange rate in effect as of June 30, 2026, as set forth in the H.10 statistical release of The Board of Governors of the Federal Reserve System. The Company makes no representation that any RMB or US$ amounts could have been, or could be, converted into US$ or RMB, as the case may be, at any particular rate, or at all. Conference Call Information The Company's management will hold a conference call on Wednesday, September 2, 2026, at 7:30 A.M. U.S. Eastern Time or 7:30 P.M. Beijing Time to discuss its financial results and operating performance for the second quarter of 2026. The replay will be accessible through Wednesday, September 9, 2026 by dialing the following numbers: A live and archived webcast of the conference call will also be available on the Company's investor relations website at http://ir.yatsenglobal.com. About Yatsen Holding Limited Yatsen Holding Limited (NYSE: YSG) is a leading China-based beauty group with the vision of becoming a world-class pioneer in beauty innovation. Founded in 2016, the Company has launched and acquired numerous color cosmetics and skincare brands including Perfect Diary, Little Ondine, Pink Bear, Galénic, DR.WU (its mainland China business), and Eve Lom. Our brands are strategically positioned to capture a wide spectrum of consumer demographics and price points, ranging from the mass market to the prestige and clinical segments. Yatsen thrives on the synergy of brand equity, product strength and operational agility, anchored by a strong commitment to R&D and consumer insights. For more information, please visit http://ir.yatsenglobal.com. Use of Non-GAAP Financial Measures The Company uses non-GAAP income (loss) from operations, non-GAAP operating income (loss) margin, non-GAAP net income (loss), non-GAAP net income (loss) margin, non-GAAP net income (loss) attributable to ordinary shareholders and non-GAAP net income (loss) attributable to ordinary shareholders per diluted ADS, each a non-GAAP financial measure, in reviewing and assessing its operating performance. The presentation of these non-GAAP financial measures is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with U.S. GAAP. The Company presents these non-GAAP financial measures because they are used by the management to evaluate operating performance and formulate business plans. Non-GAAP financial measures help identify underlying trends in its business, provide further information about its results of operations, and enhance the overall understanding of its past performance and future prospects. The Company defines non-GAAP income (loss) from operations as income (loss) from operations excluding (i) share-based compensation expenses, (ii) amortization of intangible assets resulting from assets and business acquisitions and (iii) impairment of goodwill. Non-GAAP operating income (loss) margin is non-GAAP income (loss) from operations as a percentage of total net revenues. The Company defines non-GAAP net income (loss) as net income (loss) excluding (i) share-based compensation expenses, (ii) amortization of intangible assets resulting from assets and business acquisitions, (iii) revaluation of investments on the share of equity method investments, (iv) impairment of goodwill, (v) impairment of investments and (vi) tax effects on non-GAAP adjustments. Non-GAAP net income (loss) margin is non-GAAP net income (loss) as a percentage of total net revenues. The Company defines non-GAAP net income (loss) attributable to ordinary shareholders as net income (loss) attributable to ordinary shareholders excluding (i) share-based compensation expenses, (ii) amortization of intangible assets resulting from assets and business acquisitions, (iii) revaluation of investments on the share of equity method investments, (iv) impairment of goodwill, (v) impairment of investments, (vi) tax effects on non-GAAP adjustments and (vii) accretion to redeemable non-controlling interests. Non-GAAP net income (loss) attributable to ordinary shareholders per diluted ADS is computed using non-GAAP net income (loss) attributable to ordinary shareholders divided by weighted average number of diluted ADS outstanding for computing diluted earnings per ADS. However, the non-GAAP financial measures have limitations as analytical tools as the non-GAAP financial measures are not presented in accordance with U.S. GAAP and may differ from the non-GAAP information used by other companies, including peer companies, and therefore their comparability may be limited. The Company compensates for these limitations by reconciling the non-GAAP financial measures to the nearest U.S. GAAP performance measure, all of which should be considered when evaluating performance. The Company encourages investors and others to review its financial information in its entirety and not rely on a single financial measure. Reconciliations of Yatsen's non-GAAP financial measures to the most comparable U.S. GAAP measure are included at the end of this press release. Safe Harbor Statement This announcement contains statements that may constitute "forward-looking" statements which are made pursuant to the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as "will," "expects," "anticipates," "aims," "future," "intends," "plans," "believes," "estimates," "likely to," and similar statements. The Company may also make written or oral forward-looking statements in its periodic reports to the Securities and Exchange Commission ("SEC"), in its annual report to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Statements that are not historical facts, including statements about the Company's beliefs, plans, outlook and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: the Company's growth strategies; its future business development, results of operations and financial condition; its ability to continue to roll out popular products and maintain popularity of existing products; its ability to anticipate and respond to changes in industry trends and consumer preferences and behavior in a timely manner; its ability to attract and retain new customers and to increase revenues generated from repeat customers; its expectations regarding demand for and market acceptance of its products and services; its ability to integrate newly-acquired businesses and brands; trends and competition in and relevant government policies and regulations relating to China's beauty market; changes in its revenues and certain cost or expense items; and general economic conditions globally and in China. Further information regarding these and other risks is included in the Company's filings with the SEC. All information provided in this press release is as of the date of this press release, and the Company does not undertake any obligation to update any forward-looking statement, except as required under applicable law. For investor and media inquiries, please contact: Yatsen Holding LimitedInvestor RelationsE-mail: [email protected] View original content:https://www.prnewswire.com/news-releases/yatsen-announces-second-quarter-2026-financial-results-302867531.html

This article first appeared on GuruFocus. Total Net Revenue: RMB1.14 billion for Q2 2026, up 5.1% year-over-year. Skincare Brand Revenue: Increased 40.4% year-over-year, representing 71.5% of total net revenues. Color Cosmetics Brand Revenue: Decreased 35.8% year-over-year due to proactive brand portfolio optimization and SKU rationalization. Gross Profit: RMB843.8 million, down 0.8% year-over-year. Gross Margin: Decreased to 73.9% from 78.3% in the prior year period, impacted by higher inventory provisions in the color cosmetics business. Total Operating Expenses: RMB975.7 million, up 7.7% year-over-year; as a percentage of net revenues, increased to 85.4% from 83.4%. Selling and Marketing Expenses: RMB807 million, up from RMB722.4 million; as a percentage of net revenues, increased to 70.7% from 66.5%. Fulfillment Expenses: RMB56.1 million, down from RMB63.3 million; as a percentage of net revenues, decreased to 4.9% from 5.8%. General and Administrative Expenses: RMB74.8 million, down from RMB84.1 million; as a percentage of net revenues, decreased to 6.6% from 7.7%. Research and Development Expenses: RMB37.3 million, up from RMB36.1 million; maintained at 3.3% of total net revenues. Loss from Operations: RMB131.9 million, compared with a loss of RMB65.5 million in the prior year period; operating loss margin was 11.5%. Non-GAAP Loss from Operations: RMB112.1 million, compared with a loss of RMB20.4 million in the prior year period; non-GAAP operating loss margin was 9.8%. Net Loss: RMB90.8 million, compared with a net loss of RMB19.5 million in the prior year period; net loss margin was 8%. Non-GAAP Net Loss: RMB99.4 million, compared with non-GAAP net income of RMB11.5 million in the prior year period. Net Loss per Diluted ADS: RMB0.97, compared with RMB0.19 in the prior year period. Non-GAAP Net Loss per Diluted ADS: RMB1.06, compared with non-GAAP net income per diluted ADS of RMB0.13 in the prior year period. Cash and Investments: RMB1.06 billion as of June 30, 2026, compared with RMB1.05 billion as of December 31, 2025. Net Cash Used in Operating Activities: RMB78 million in Q2 2026, compared with net cash generated from operating activities of RMB77.7 million in the prior year period. Q3 2026 Revenue Outlook: Expected between RMB898.6 million and RMB998.4 million, representing a year-over-year decrease of approximately 0% to 10%. Warning! GuruFocus has detected 2 Warning Signs with YSG. Is YSG fairly valued? Test your thesis with our free DCF calculator. Release Date: September 02, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Skincare portfolio delivered exceptional performance, with revenues increasing 40.4% year-over-year and now representing 71.5% of total net revenues. Total net revenues grew 5.1% year-over-year despite a challenging industry backdrop, demonstrating resilience. R&D investment remained consistent at 3.3% of total net revenues, with continued scientific achievements including publications in international journals and recognition as a national high-tech enterprise. Strategic channel expansion into lower-cost B2B, offline distribution, duty-free, and professional channels is expected to support healthier profitability and reduce reliance on expensive online traffic. New CFO appointment brings over 15 years of experience in the consumer and beauty industry, expected to support cost optimization and sustainable profitable growth. Color cosmetics net revenues decreased 35.8% year-over-year due to proactive brand portfolio optimization and SKU rationalization. Gross margin decreased to 73.9% from 78.3% year-over-year, impacted by higher inventory provisions in the color cosmetics business. Operating loss widened significantly to RMB131.9 million from RMB65.5 million, with operating loss margin expanding to 11.5% from 5.1%. Selling and marketing expenses increased to 70.7% of net revenues from 66.5%, driven by rising traffic acquisition costs and strategic investments in high-growth channels like Douyin. The company expects total net revenues for Q3 2026 to decline by 0% to 10% year-over-year, indicating a potential slowdown in growth. Q: What is the company's channel expansion strategy for its skincare brands, and how will it respond to rising online traffic costs to improve marketing efficiency?A: Irene Liu, Vice President, Head of Strategic Investment, explained that channel expansion is crucial for the next stage of skincare growth. Beyond core platforms like Tmall and Douyin, the company will increase B2B channels (e.g., JB, variety shops, TBD) and offline channels (distribution, duty-free, professional channels) that carry lower traffic costs and support healthier profitability. Dr. Wu's success with a higher B2B mix serves as a model for other brands. To address rising traffic costs, the company is shifting resources to high-return skincare brands (now over 70% of revenue), expanding to lower-cost channels, and improving content creation, CRM retention, and budget allocation using AI agentsaiming for better efficiency and profitability without blindly cutting investment. Q: Can you provide details on the company's financial performance for the second quarter of 2026, including revenue, margins, and profitability?A: Donghao Yang, CFO, reported total net revenues grew 5.1% year-over-year to RMB1.14 billion, driven by a 40.4% increase in skincare revenues, partially offset by a 35.8% decline in color cosmetics due to proactive portfolio optimization. Gross margin decreased to 73.9% from 78.3%, impacted by higher inventory provisions in color cosmetics. Operating loss was RMB131.9 million (11.5% margin), and net loss was RMB90.8 million (8% margin). Non-GAAP net loss was RMB99.4 million, compared to non-GAAP net income of RMB11.5 million in the prior year. The company had RMB1.06 billion in cash and short-term investments as of June 30, 2026. Q: What is the company's business outlook for the third quarter of 2026?A: Donghao Yang, CFO, guided that total net revenues for Q3 2026 are expected to be between RMB898.6 million and RMB998.4 million, representing a year-over-year decrease of approximately 0% to 10%. This forecast reflects the company's current preliminary views on market and operational conditions, which are subject to change. Q: What were the key drivers behind the increase in selling and marketing expenses during the quarter?A: Donghao Yang, CFO, noted that selling and marketing expenses increased to 70.7% of net revenues from 66.5% in the prior year. This was primarily driven by strategic investments in broadening consumer awareness and building long-term brand equity for core skincare brands, coupled with higher traffic acquisition costs on the Douyin platform as the company capitalized on the channel's strong growth momentum. Q: How is the company addressing the structural profitability challenges in its color cosmetics business?A: Jinfeng Huang, CEO, stated that the company is actively streamlining its color cosmetics portfolio to improve profitability, focusing resources on higher-growth skincare brands. The color cosmetics segment faces fast-changing consumer trends, high SKU complexity, and ongoing promotion intensity, requiring disciplined management and focused resource allocation. The company is also optimizing cost structures and refining resource allocation across channels to unlock operating leverage. Q: What recent R&D achievements and product innovations has the company made?A: Jinfeng Huang, CEO, highlighted that R&D expenses remained at 3.3% of net revenues. In May, the Global Innovation R&D Center was recognized as a national high-tech enterprise in Shanghai. In July, Dr. Wu published three research studies in international STI journals covering innovative approaches to acne, post-acne marks, and clinical evidence for a metallic acid serum. Product launches included Galenic's revising eye cream, Dr. Wu's three new essence masks, and Evlon's VitalDew Fresh Hydration Cream and Skin Infusion Serum. Q: How did the skincare portfolio perform in the second quarter, and what is its current contribution to total revenue?A: Jinfeng Huang, CEO, reported that skincare revenues increased 40.4% year-over-year, now representing 71.5% of total net revenues. This strong performance reinforces skincare as a core pillar of the business and a key driver of overall growth, validating the effectiveness of investments in brand building, product innovation, and channel development. Q: What leadership changes were announced during the call?A: Jinfeng Huang, CEO, announced that Ms. Wang Li has been appointed as the company's Chief Financial Officer, effective today. Ms. Wang brings over 15 years of experience in the consumer and beauty industry, most recently serving as CFO of QIR Cosmetics. Her expertise will support efforts to optimize cost structure, improve resource allocation, and drive sustainable profitable growth. For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Interested in Yatsen Holding Limited Sponsored ADR? Here are five stocks we like better. Revenue grew 5.1% to RMB1.14 billion, driven by a 40.4% increase in skincare sales, which accounted for 71.5% of revenue. This was partially offset by a 35.8% decline in color cosmetics revenue amid portfolio optimization and SKU reductions. Profitability weakened significantly: gross margin fell to 73.9% due largely to inventory provisions, while higher marketing expenses pushed the company’s net loss to RMB90.8 million from RMB19.5 million a year earlier. Yatsen plans to improve profitability by diversifying beyond Tmall and Douyin into business-to-business, offline, duty-free and professional channels. It forecasts third-quarter revenue of RMB898.6 million to RMB998.4 million, implying roughly flat to 10% year-over-year decline. Yatsen (NYSE:YSG) reported second-quarter 2026 revenue growth of 5.1% as continued strength in its skincare portfolio offset a sharp decline in color cosmetics sales, while higher inventory provisions and increased marketing spending widened the company’s losses. Total net revenue rose to RMB1.14 billion from RMB1.09 billion a year earlier. Founder, Chairman and CEO Jinfeng Huang said the result reflected continued progress in the company’s strategic transformation despite a challenging competitive environment for China’s beauty industry. → Boarding Call: EHang Secures First-Mover Altitude “While overall growth was more moderate than our prior expectations, our skincare portfolio delivered exceptional performance,” Huang said, adding that the company’s skincare brands have become a core driver of growth. Revenue from Yatsen’s skincare brands increased 40.4% year over year during the quarter and accounted for 71.5% of total net revenue. That performance was partly offset by a 35.8% decline in revenue from color cosmetics brands, which management attributed to deliberate brand portfolio optimization and SKU rationalization. → Medtronic’s Stars Are Aligning for a Price Recovery Huang said the shift in the revenue mix toward skincare represents a move toward “higher quality, more sustainable growth.” The company continued to invest in research and development, with R&D expense representing 3.3% of total revenue in the quarter, broadly consistent with the prior-year period. During the quarter, Yatsen expanded product offerings across its skincare portfolio. Galénic launched an Active Eye Cream under its Couture Révélation Cellulaire line; DR.WU introduced three essence masks targeting oil control, hydration and soothing care; and Eve Lom expanded its second-generation Vital Dew range with a hydration cream and skin infusion serum. → Dutch Bros Sell-Off Creates a Growth Opportunity Management also cited brand-building activities, including a DR.WU livestreaming event with cctv.com that attracted a cumulative audience of 178 million viewers. Galénic held a summer campaign pop-up event on Wuzhizhou Island in Sanya, while Eve Lom participated in the British Beauty Festival. Gross profit declined 0.8% year over year to RMB843.8 million, while gross margin fell to 73.9% from 78.3%. Huang and CFO Donghao Yang said the decline was primarily related to higher inventory provisions in the color cosmetics business amid portfolio optimization and SKU reductions. Huang said that excluding the impact of the one-time inventory provisions, underlying gross margin would have been roughly stable from a year earlier. Total operating expenses increased 7.7% to RMB975.7 million, or 85.4% of revenue, compared with 83.4% a year earlier. Selling and marketing expense climbed to RMB807.6 million, representing 70.7% of revenue, from RMB722.4 million, or 66.5% of revenue, in the prior-year period. Yang said the increase reflected investments to build consumer awareness and long-term brand equity for the company’s core skincare brands, along with higher traffic acquisition costs on Douyin as Yatsen pursued growth opportunities on the platform. Fulfillment expenses declined to RMB56.1 million from RMB63.3 million, which Yang attributed to improved logistics efficiency. General and administrative expenses fell to RMB74.8 million from RMB84.1 million, primarily due to lower share-based compensation expenses. Operating loss: RMB131.9 million, compared with RMB55.5 million a year earlier. Non-GAAP operating loss: RMB112.1 million, compared with RMB20.4 million a year earlier. Net loss: RMB90.8 million, compared with RMB19.5 million a year earlier. Non-GAAP net loss: RMB99.4 million, compared with non-GAAP net income of RMB11.5 million a year earlier. Net cash used in operating activities was RMB78 million, compared with RMB77.7 million of cash generated from operations in the prior-year quarter. As of June 30, Yatsen had RMB1.06 billion in cash, restricted cash and short-term investments, compared with RMB1.05 billion at the end of 2025. During the question-and-answer session, newly appointed Co-Chief Financial Officer Li Wang said expanding distribution channels will be important to the next stage of growth for Yatsen’s skincare brands. Wang said the company plans to supplement its core Tmall and Douyin channels with online business-to-business platforms including JD, Vipshop and TBD, as well as offline distribution, duty-free and professional channels. She said such channels generally have lower traffic costs and can support a healthier profitability profile. DR.WU has already demonstrated that a higher business-to-business sales mix can support both growth and profitability, Wang said, adding that Yatsen intends to selectively apply that model to other skincare brands. The company is also pursuing differentiated formats, including Galénic boutique stores in premium department stores and shopping malls, and DR.WU distribution through over-the-counter drugstore channels. To address rising online traffic costs, Wang said Yatsen is directing more resources toward higher-growth and higher-return skincare brands, expanding professional and business-to-business channels, and improving content creation, customer relationship management retention and budget allocation. The company is also using AI agents as part of efforts to strengthen financial discipline and marketing efficiency. “The goal is not to cut investment blindly,” Wang said. “Our goal is to support strong skincare growth with better efficiency and stronger profitability over time.” For the third quarter of 2026, Yatsen expects total net revenue of between RMB898.6 million and RMB998.4 million, representing a year-over-year decline of approximately 0% to 10%. Huang also announced that Wang Li was appointed Co-Chief Financial Officer effective immediately. Wang has more than 15 years of experience in the consumer and beauty industries and most recently served as CFO of Proya Cosmetics, according to Huang. She will work alongside Yang to support cost-structure optimization, resource allocation and the company’s pursuit of sustainable profitable growth. Yatsen Holding Limited (NYSE: YSG) is a Shanghai-based beauty and personal care company founded in 2016. The firm operates as a digital-first cosmetics provider, designing, developing and marketing its own brands to a primarily Chinese consumer base. Since its inception, Yatsen has focused on leveraging data analytics and social media engagement to drive product innovation and brand awareness. The company's core portfolio includes Perfect Diary, a color-cosmetics brand offering lipsticks, eyeshadows, foundations and related accessories; Little Ondine, which specializes in nail lacquers and nail care products; Winona, a sensitive-skin skincare line; and Abby's Choice, which features targeted skincare treatments. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "Yatsen Q2 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for September 2026.

Interested in Yatsen Holding Limited Sponsored ADR? Here are five stocks we like better. Revenue grew 22.5% year over year to CNY 1.02 billion in Q1 2026, driven mainly by a 58.5% jump in skincare brand sales even as color cosmetics declined 5%. Profitability weakened as operating expenses rose 32.5%, led by higher marketing and Douyin traffic costs; Yatsen’s net loss widened to CNY 61.9 million from CNY 5.6 million a year earlier. Management said it will keep focusing on skincare innovation, brand building, and channel optimization, and it guided Q2 2026 revenue to CNY 1.2 billion to CNY 1.3 billion, implying 10% to 20% growth. Yatsen (NYSE:YSG) reported first-quarter 2026 revenue growth that management said reflected continued momentum in its skincare portfolio, even as higher marketing spending and platform traffic costs contributed to wider losses. The Guangzhou-based beauty company said total net revenues rose 22.5% year over year to CNY 1.02 billion, up from CNY 833.5 million in the prior-year period. Chief Financial Officer and Director Donghao Yang said the increase was primarily driven by a 58.5% year-over-year rise in net revenues from skincare brands, partially offset by a 5% decline in net revenues from color cosmetics brands. → Voya Financial Grows Earnings Across All 3 Business Segments Founder, Chairman and Chief Executive Officer Jinfeng Huang said the results demonstrated “ongoing resilience” in Yatsen’s multi-brand strategy amid a competitive domestic beauty market. Citing China’s National Bureau of Statistics, Huang said beauty retail sales grew 5.9% year over year in the first quarter, while combined sales across Tmall, Douyin and JD.com also rose at a single-digit pace. Huang said Yatsen’s strategic shift toward skincare continued to support revenue growth and gross margin expansion. The company’s gross profit increased 24.3% year over year to CNY 819.2 million, while gross margin rose to 80.2% from 79.1% a year earlier, according to Yang. → SpaceX Gets the Attention, But These 4 Stocks Could Get the Returns Management highlighted several product and brand initiatives during the quarter. Huang said Galénic’s new Couture Révélation Cellulaire Revitalising Cream “was an instant hit” and sold out shortly after launch. He also said Dr. Wu expanded its PDRN series with the Ageversal Sodium DNA Hydroluminous Mask and Ageversal Advanced Rejuvenate Eye Cream, while another launch expanded the portfolio with a Renewal Intensive Treatment for the eye area. Huang said Yatsen continued to increase research and development spending as part of its focus on product innovation. R&D expenses rose to CNY 39.4 million from CNY 22.6 million a year earlier, representing 3.9% of total net revenues versus 2.7% in the prior-year period. Yang attributed the increase primarily to higher payroll expenses tied to increased R&D headcount. → Ross Stores Earnings Beat Sends Stock To New Highs Huang also pointed to Dr. Wu’s fourth Acne Research Fund project, launched in March, and the brand’s April release of a white paper on Chinese dermatological research and skin renewal. He said the publication was based on clinical expertise and skin insights and helped reinforce the brand’s dermatology credentials. Despite revenue growth and a higher gross margin, Yatsen’s losses widened as operating expenses rose. Total operating expenses increased 32.5% year over year to CNY 918.1 million, or 89.9% of total net revenues, compared with 83.2% a year earlier. Selling and marketing expenses were the largest cost component, rising to CNY 737.2 million from CNY 553.8 million. As a percentage of total net revenues, selling and marketing expenses increased to 72.2% from 66.4%. Yang said the increase was driven by investments to broaden consumer awareness and build long-term brand equity for core brands, as well as higher traffic acquisition costs on Douyin. Fulfillment expenses rose to CNY 61.1 million from CNY 51.8 million, but fell as a percentage of revenue to 6.0% from 6.2%, which Yang attributed to improved logistics efficiency. General and administrative expenses increased to CNY 80.3 million from CNY 64.9 million and remained largely flat as a percentage of revenue at 7.9%. Loss from operations was CNY 99.0 million, compared with CNY 34.1 million a year earlier. Operating loss margin widened to 9.7% from 4.1%. Non-GAAP loss from operations was CNY 84.6 million, compared with CNY 14.9 million in the prior-year period. Net loss totaled CNY 61.9 million, compared with CNY 5.6 million a year earlier. Net loss attributable to ordinary shareholders per diluted ADS was RMB 0.64, compared with RMB 0.06 in the prior-year period. On a non-GAAP basis, Yatsen reported a net loss of CNY 57.3 million, compared with non-GAAP net income of CNY 7.1 million a year earlier. Huang said Yatsen remains focused on three strategic priorities: R&D-led innovation, strengthening brand equity and improving overall profitability. He said the company would “dynamically adjust” its channel mix, streamline operating expenses and seek greater operating leverage from fixed costs. During the question-and-answer session, CICC analyst Manqi Huang asked about skincare portfolio expansion and competition from foreign high-end skincare brands. Management said Yatsen would continue expanding around proven “hero product families,” citing Galénic’s anti-aging cream and growth from its snow algae facial moisturizer cream. For Dr. Wu and Yuesao, management said the company would build complete routines around science, efficacy and consumer demand. On competition, management said the high-end skincare market remains intense but argued Yatsen has a differentiated position through global heritage, scientific credibility, local consumer insights and fast execution. Management also said the company is using AI and data tools to improve consumer insights, content production, customer relationship management and marketing return on investment. CITIC Securities analyst Lin Zhang asked about Dr. Wu’s growth. Management said Dr. Wu has benefited from a higher B2B channel mix, including professional and offline channels, which provides a better balance between growth, traffic costs and profitability. Management said it hopes to selectively apply lessons from Dr. Wu to other skincare brands. As of March 31, 2026, Yatsen had cash, restricted cash and short-term investments of CNY 934.2 million, down from CNY 1.05 billion at the end of 2025. Net cash used in operating activities was CNY 90.0 million, compared with net cash generated from operating activities of CNY 23.8 million in the prior-year period. Huang also said Yatsen completed the first tranche of a private placement of convertible notes and warrants on May 31, 2026, following a March 11 announcement. He said participating investors included himself, Cha Capital and Hillhouse. For the second quarter of 2026, Yatsen expects total net revenues of CNY 1.2 billion to CNY 1.3 billion, representing year-over-year growth of approximately 10% to 20%. Yang said the forecast reflects the company’s current and preliminary views on market and operating conditions and remains subject to change. Yatsen Holding Limited (NYSE: YSG) is a Shanghai-based beauty and personal care company founded in 2016. The firm operates as a digital-first cosmetics provider, designing, developing and marketing its own brands to a primarily Chinese consumer base. Since its inception, Yatsen has focused on leveraging data analytics and social media engagement to drive product innovation and brand awareness. The company's core portfolio includes Perfect Diary, a color-cosmetics brand offering lipsticks, eyeshadows, foundations and related accessories; Little Ondine, which specializes in nail lacquers and nail care products; Winona, a sensitive-skin skincare line; and Abby's Choice, which features targeted skincare treatments. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "Yatsen Q1 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for May 2026.

Image source: The Motley Fool. Tuesday, May 26, 2026 at 7:30 a.m. ET Founder, Chairman, and CEO — Jinfeng Huang Chief Financial Officer and Director — Donghao Yang Vice President, Head of Strategic Investment and Capital Markets — Irene Lyu Operator: Ladies and gentlemen, good day, and welcome to the Yatsen First Quarter 2026 Earnings Conference Call. Today's conference is being recorded. At this time, I would like to turn the conference over to Irene Lyu, Vice President, Head of Strategic Investment and Capital Markets. Please go ahead. Irene Lyu: Thank you, operator. Please note the discussion today will contain forward-looking statements relating to the company's future performance and are intended to qualify for the safe harbor from liability as established by the U.S. Private Securities Litigation Reform Act. Such statements are not guarantees of future performance and are subject to certain risks and uncertainties, assumptions and other factors. Some of these risks are beyond the company's control and could cause actual results to differ materially from those mentioned in today's press release and this discussion. A general discussion of the risk factors that could affect Jason's business financial results is included in certain filings of the company with the Securities and Exchange Commission. Companies that box undertakes any obligation to update this forward-looking information, except as required by law. During today's call, management will also discuss certain non-GAAP financial measures for comparison purposes for. Please see the earnings release issued earlier today for a definition of non-GAAP financial measures and a reconciliation of GAAP to non-GAAP financial results. Joining us today on the call from Yatsen's senior management are Mr. Info Hong, our Founder, Chairman and CEO; and Mr. Doho Yang, our CFO and Director. Management will begin with prepared remarks, and the call will conclude with the Q&A session. As a reminder, this conference is duly recorded. In addition, a webcast replay of this conference call will be available on Yatsen's Investor Relations website. at ir.yatsenglobal.com. I'll now turn the call over to Mr. Jinfeng Huang. Please go ahead, sir. Jinfeng Huang: Thank you, Irene. Hello, everyone, and thank you for joining our first quarter 2026 earnings call earnings call. Going into this year, we delivered top line growth that met our period guidance range. and demonstrated ongoing resilience of our multi-brand strategy. Our financial and operational highlights this quarter further show that Yatsen is navigating the market with a clear strategic vision. Looking at the macro environment. According to the National Bureau of Statistics, beauty retail sales grew by 5.9% year-over-year in the third quarter of it reflecting a stable, highly competitive domestic beauty market. Looking closely at the online channels, the combined sales across Tmall, Loen and Digi.com also recorded a single-digit year-over-year growth. Against this market backdrop, our strategic rebalancing has yield highly encouraging results. Our total net revenues based on a steady growth trajectory, growing by 22.5% year-over-year for the first quarter. More importantly, this growth was primarily proposed by the sustained upward momentum of our sincere brand, which experienced another substantial year-over-year growth of 58.5% on -- so driven by this favorable shift toward our inter offering, our gross margin continued its year-over-year expansion and reached a historical milestone of 18.2% reinforcing the structural health of our business model. Throughout the first quarter, we remain swiftly committed to our core strategic initiatives. Basically, we continue to drive R&D last quarter innovation, strengthen brand equity across our multi-brand portfolio and position our business for long-term profitability optimization. In the following section, I would like to share our key progress across each of these 3 strategic pillars. Our first pillar is driving R&D-led innovation, which remains the ultimate engine behind our sustainable growth. In the first quarter, we consistently set up our R&D investments. This R&D expenses as a percentage of total net revenues increasing further to 3.9%. This ongoing commitment allowed us to broaden our scientific initiatives. For instance, Dr. Wu long support of acne Research Fund project in March. Bridging online and off-line dermatological assets to tackle a series of specialized research products. In April, the brand marks another milestone with the release of the white paper on Chinese dermatological research and skin renewal. Leveraging 48 years of clinical ecloud and skin insight, this publication officially defines a multi-ingredient multi-target and full layer in renewable management framework, further solidifying the brand authorities in dermatology. On the product front, our advanced R&D system has successfully powered a series of highly market-ready solution. During the first quarter, Galani's new cotrevalation seller revising cream with an instant feet. Starting now soon after its developed. Votable expanded its successful PDR series with the introduction of 2 new breakthrough products. The versal sodium ENA collagen hydroluminal mark and the adversal anti-lingo quality cream. Meanwhile, plan also expanded its product portfolio by launching the renewal in 10 treatments, designed specifically for the dedicated eye area. These launches underscore our enhanced efficiency and expanding existing series into new categories and a broader expertise. Our second pillar is strengthening brand equity through our portfolio through expert-led communication and strategic brand activities. In March, lanicmade a high-profile appearance at AMW. The aesthetic and anti-agent Medicine World Congress in Monaco. This world-class presentation further reinforced the mic scientist scientific credentials and solidified its core consumer mill share in cellular level anti-agent sites. Furthermore, in April, Galani announced the appointment of a Fundtech as a new brand and base, a move that has amplified its brand retina and consumer awareness. Our third pillar is improving overall profitability. So during the first quarter, our selling and marketing expenses as a percentage of total net revenues, we experienced an increase. As a result of both the continued investment in building our core brands and the elevated industry-wide traffic acquisition costs on the Doing platform. However, our commitment to long-term profitability optimization remains unwavering. More forward, we will dynamically adjust our channel mix. streamline our operational expenses and unlock greater operational leverage for our fixed costs. These initiatives will ensure that our top line expansion efficiently translate into further margin improvement paving the way of sustainable profit-centric growth. Finally, I would like to provide an important update regarding our recent financing transaction. Following our announcement on March 11, we are pleased to note that we successfully completed the first change of the private placement of convertible notes and warrants on May 21, 2026. In addition to myself and CaspaCapital, we are delighted to welcome -- House as a key participating investor in this offering. This successful closing serves as a powerful treatment a testament to our long-term investors steady fast confidence, investments, strategic direction and further value. Management shares this exact same competence, and we are fully energized to deliver sustained value for our shareholders in the quarters to come. With that, I will now turn the call over to our CFO, Donghao Yang, to discuss our financial details. Donghao Yang: Thank you, David, and hello, everyone. Before I get started, I would like to clarify that all financial numbers presented today are renminbi amounts and all percentage changes refer to year-over-year changes unless otherwise noted. Total net revenues for the first quarter of 2026 increased by 22.5% to $1.02 billion from $833.5 million for the prior year period. The increase was primarily due to a 58.5% year-over-year increase in net revenues from skin care brands, partially offset by a 5% year-over-year decrease in net revenues from Cove cosmetics brands. Gross profit for the first quarter of 2026 increased by 24.3% to $819.2 million from $659.1 million for the prior year period. Gross margin for the first quarter of 2026 increased to 80.2% from 79.1% for the prior year period. Total operating expenses for the first quarter of 2026 increased by 32.5% to $918.1 million from $693.2 million for the prior year period. As a percentage of total net revenues, Total operating expenses for the first quarter of 2026 were 89.9% as compared with 83.2% for the prior year period. Fulfillment expenses for the first quarter of 2026 were $61.1 million as compared with $51.8 million for the prior year period. As a percentage of total net revenues, fulfillment expenses for the first quarter of 2026 decreased to 6% from 6.2% for the prior year period. The decrease was primarily due to further improvement in logistics efficiency. Selling and marketing expenses for the first quarter of 2026 were $737.2 million as compared with $553.8 million for the prior year period. As a percentage of total net revenues, selling and marketing expenses for the first quarter of 2026 increased to 72.2% from 66.4% for the prior year period. The increase was primarily driven by investments in bottoming consumer awareness and building long-term brand equity of our core brands, coupled with higher traffic acquisition costs under the lean platform. General and administrative expenses for the first quarter of 2026, were $80.3 million as compared with $64.9 million for the prior year period. As a percentage of total net revenues, general and administrative expenses for the first quarter of 2026 was 7.9% as compared with 7.8% for the prior year period, remaining largely flat. Research and development expenses for the first quarter of 2026 were $39.4 million as compared with $22.6 million for the prior year period. As a percentage of total net revenues, Research and development expenses for the first quarter of 2026 increased to 3.9% from 2.7% for the prior year period. The increase was primarily driven by higher payroll expenses resulting from a rise in research and development headcount. Loss from operations for the first quarter of 2026 was $99 million as compared with $34.1 million for the prior year period. Operating loss margin was $9.7 million as compared with 4.1% for the prior year period. Non-GAAP loss from operations for the first quarter of 2026 was $84.6 million as compared with $14.9 million for the prior year period. Non-GAAP operating loss margin was 8.3% as compared with 1.8% for the prior year period. Net loss for the first quarter of 2026 was $61.9 million as compared with $5.6 million for the prior year period. Net loss margin was 6.1%, as compared with 0.7% for the prior year period. Net loss attributable to Yatsen's ordinary shareholders per diluted ADS for the first quarter of 2026, was RMB 0.64 as compared with RMB 0.06 for the prior year period. Non-GAAP net loss for the first quarter of 2026 was $57.3 million as compared with non-GAAP net income of $7.1 million for the prior year period. Non-GAAP net loss margin was 5.6% as compared with non-GAAP net income margin of 0.9% for the prior year period. Non-GAAP net loss attributable to Yatsen's ordinary shareholders per diluted ADS for the first quarter of 2026 was RMB 0.6 as compared with non-GAAP net income attributable to Yatsen's ordinary shareholders per diluted ADS of RMB 0.07 for the prior year period. As of March 31, 2026, the company had cash, restricted cash and short-term investments of $934.2 million as compared with $1.05 billion as of December 31, 2025. Net cash used in operating activities for the first quarter of 2026 was $90 million as compared with net cash generated from operating activities of $23.8 million for the prior year period. Looking at our business outlook for the second quarter of 2026, we expect our total net revenues to be between $1.2 billion and $1.3 billion representing a year-over-year increase of approximately 10% to 20%. These forecasts reflect the company's current and preliminary views on the market and operational conditions, which are subject to change. With that, I would now like to open the call to Q&A. Operator? Operator: [Operator Instructions] And our first question today comes from Manqi Huang with CICC. Manqi Huang: This is Manqi Huang from CICC. I have 2 questions. But my first question, we've seen a rapid growth of our skin care brands in this quarter. could management share with us how to expand our product portfolio of Skin Care brand going forward. And my second question is that how do we view the competition from foreign brands, especially in high-end skin care market? That's my 2 questions. Thank you Jinfeng Huang: We will continue to expand around proven hero product families. In quarter 1, galenic new anti-aging cream was a great success and sold out shortly after launch. We also saw significant growth from Galenica models. So these results give us more confidence that the lane can expand from Hisar into a broader anti-agent in skin care routine. For Dr. Wen plan, we will follow the same logic built complete routines around proven science, strong efficacy and a clear consumer demand. . For the second question regarding the competition from high-end for in brand. Competition is very intense. But we believe we have a differentiated position. So our skincare brands, combined global heritage, strong client capabilities, local consumer insights and very fast education. Galanis is a very great example. We are building the brand around cellular level anti agent supported by successful product launches and stronger brand communication. We are also using AI and data tools to improve consumer insights, content production, CIM and make -- so this help us to compete more efficiently, not just be more. Operator: [Operator Instructions] Our next question today comes from Lin Zhang of Citic Securities. Lin Zhang: I'm Lin Zhang from Citic Securities. My question is that we have noticed Dou is growing really fast. So could you please share with us the key drivers of the growth? Jinfeng Huang: Well, otitis a very important case for us. So the brand has delivered strong growth while maintaining a healthier profitability profile. The 1 reason is higher B2T channel mix. including professional and off-line channels, which give us the brand a better balance between growth, shape costs and profitability. So this is a model we want to learn from and the selectively apply to other tinkers -- stronger signs, more professional capability, more balanced channel mix and better marketing efficiencies. Those are some of the key drivers we summarize for. Operator: And that concludes the question-and-answer session. I would like to turn the conference back over to management for any additional or closing comments. Irene Lyu: Thank you once again for joining us today. If you have any further questions, please feel free to commit us Yetsen directly. For content information for IR in both China and the U.S. can be found in today's press release. Thank you, and have a great day. . Operator: Thank you. And that concludes today's conference call. We thank you all for attending today's presentation. You may now disconnect your lines, and have a wonderful day. Before you buy stock in Yatsen, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Yatsen wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $477,813!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,320,088!* Now, it’s worth noting Stock Advisor’s total average return is 986% — a market-crushing outperformance compared to 208% for the S&P 500. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors. See the 10 stocks » *Stock Advisor returns as of May 26, 2026. This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. Yatsen (YSG) Q1 2026 Earnings Call Transcript was originally published by The Motley Fool

This article first appeared on GuruFocus. Total Net Revenues: Increased by 22.5% to RMB1.02 billion. Skincare Brands Revenue: Increased by 58.5% year-over-year. Color Cosmetics Brands Revenue: Decreased by 5% year-over-year. Gross Profit: Increased by 24.3% to RMB819.2 million. Gross Margin: Increased to 80.2% from 79.1%. Total Operating Expenses: Increased by 32.5% to RMB918.1 million. Operating Loss: RMB99 million, with an operating loss margin of 9.7%. Net Loss: RMB61.9 million, with a net loss margin of 6.1%. Non-GAAP Net Loss: RMB57.3 million, with a non-GAAP net loss margin of 5.6%. Cash, Restricted Cash, and Short-term Investments: RMB934.2 million as of March 31, 2026. Net Cash Used in Operating Activities: RMB90 million. Warning! GuruFocus has detected 2 Warning Signs with YSG. Is YSG fairly valued? Test your thesis with our free DCF calculator. Release Date: May 26, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Yatsen Holding Ltd (NYSE:YSG) reported a 22.5% year-over-year increase in total net revenues for the first quarter of 2026, reaching RMB1.02 billion. The company's skincare brand experienced substantial growth, with net revenues increasing by 58.5% year-over-year. Gross margin reached a historical milestone of 80.2%, indicating strong structural health of the business model. Yatsen's R&D investments increased, with expenses rising to 3.9% of total net revenues, supporting product innovation and scientific initiatives. Successful completion of the first tranche of a private placement of convertible notes and warrants, with Hillhouse joining as a key investor, demonstrating confidence in Yatsen's strategic direction. Operating expenses increased by 32.5% year-over-year, reaching RMB918.1 million, which is 89.9% of total net revenues. The company reported a net loss of RMB61.9 million for the first quarter of 2026, compared to a net loss of RMB5.6 million in the prior year period. Selling and marketing expenses rose significantly to 72.2% of total net revenues, driven by investments in brand equity and higher traffic acquisition costs. Net cash used in operating activities was RMB90 million, compared to net cash generated of RMB23.8 million in the prior year period. The company's cash, restricted cash, and short-term investments decreased to RMB934.2 million as of March 31, 2026, from RMB1.05 billion as of December 31, 2025. Q: We've seen rapid growth in skincare brands this quarter. How does management plan to expand the product portfolio of skincare brands going forward? Also, how do you view competition from foreign brands, especially in the high-end skincare market? A: We will continue to expand around proven hero product families. For instance, Galenic's new anti-aging cream was a success, selling out shortly after launch. We plan to build complete routines around proven science and strong consumer demand. Regarding competition, while it is intense, we believe our differentiated position, combining global heritage, scientific credibility, and local consumer insights, gives us an edge. We leverage AI and data tools to improve consumer insights and marketing efficiency. Q: DR. WU is growing rapidly. Could you share the key drivers of this growth? A: DR. WU has shown strong growth while maintaining a healthy profitability profile. Key drivers include a higher B2B channel mix, which balances growth, traffic cost, and profitability. This model, emphasizing strong science and professional credibility, is something we aim to apply to other skincare brands. Q: What are the financial highlights for the first quarter of 2026? A: Total net revenues increased by 22.5% to RMB1.02 billion, driven by a 58.5% increase in skincare brand revenues. Gross profit rose by 24.3% to RMB819.2 million, with a gross margin of 80.2%. However, operating expenses increased by 32.5%, leading to a net loss of RMB61.9 million. Q: How is Yatsen addressing the increased selling and marketing expenses? A: Selling and marketing expenses increased due to investments in brand equity and higher traffic acquisition costs on Douyin. We remain committed to long-term profitability by dynamically adjusting our channel mix, streamlining operational expenses, and unlocking greater operational leverage. Q: What is the business outlook for the second quarter of 2026? A: We expect total net revenues to be between RMB1.2 billion and RMB1.3 billion, representing a year-over-year increase of approximately 10% to 20%. These forecasts reflect our current views on market and operational conditions. For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Conference Call to Be Held at 7:30 A.M. U.S. Eastern Time on May 26, 2026 GUANGZHOU, China, May 26, 2026 /PRNewswire/ -- Yatsen Holding Limited ("Yatsen" or the "Company") (NYSE: YSG), a leading China-based beauty group, today announced its unaudited financial results for the quarter ended March 31, 2026. First Quarter 2026 Highlights Total net revenues for the first quarter of 2026 increased by 22.5% to RMB1.02 billion (US$148.0 million) from RMB833.5 million for the prior year period. Total net revenues from Skincare Brands[1] for the first quarter increased by 58.5% to RMB574.2 million (US$83.2 million) from RMB362.4 million for the prior year period. As a percentage of total net revenues, total net revenues from Skincare Brands for the first quarter of 2026 were 56.2%, as compared with 43.5% for the prior year period. Gross margin for the first quarter of 2026 increased to 80.2% from 79.1% for the prior year period. Net loss for the first quarter of 2026 was RMB61.9 million (US$9.0 million), as compared with RMB5.6 million for the prior year period. Non-GAAP net loss[2] for the first quarter of 2026 was RMB57.3 million (US$8.3 million), as compared with non-GAAP net income of RMB7.1 million for the prior year period. Mr. Jinfeng Huang, Founder, Chairman and Chief Executive Officer of Yatsen, stated, "For the first quarter of 2026, we delivered top-line growth that met our previous guidance and demonstrated the ongoing resilience of our multi-brand strategy. Our growth this quarter was primarily propelled by the sustained upward momentum of our Skincare Brands, which experienced substantial year-over-year growth of 58.5%. Guided by our vision to become a world-class pioneer in beauty innovation, we remain committed to strengthening our R&D-led innovation, expanding our hero product families, and positioning our core brands for high-quality growth. Furthermore, we are pleased to note that we completed the first closing of our private placement of convertible notes and warrants in an aggregate principal amount equivalent to approximately US$120 million, with participation from Trustar Capital, Hillhouse and myself, on May 21, 2026. This successful closing serves as a powerful testament to our shareholders' long-term confidence in Yatsen's strategic direction and future value." Mr. Donghao Yang, Director and Chief Financial Officer of Yatsen, commented, "Our financial results for the first quarter of 2026 reflect encouraging progress in the expansion of our core brands. Total net revenues from our Skincare Brands delivered robust growth, while the combined net revenues of our three major premium and clinical skincare brands, Galénic, DR.WU and Eve Lom, grew by 61.4% year over year. Our gross margin continued its year-over-year expansion and reached 80.2%. This underlying strength underscores the structural health of our business model. While we selectively deployed resources to scale and strengthen our core brands, our commitment to long-term profitability optimization remains unwavering. Moving forward, we are focused on cost optimization to ensure that our top-line expansion efficiently translates into future margin improvement." First Quarter 2026 Financial Results Net Revenues Total net revenues for the first quarter of 2026 increased by 22.5% to RMB1.02 billion (US$148.0 million) from RMB833.5 million for the prior year period. The increase was primarily due to a 58.5% year-over-year increase in net revenues from Skincare Brands, partially offset by a 5.0% year-over-year decrease in net revenues from Color Cosmetics Brands.[3] Gross Profit and Gross Margin Gross profit for the first quarter of 2026 increased by 24.3% to RMB819.2 million (US$118.8 million) from RMB659.1 million for the prior year period. Gross margin for the first quarter of 2026 increased to 80.2% from 79.1% for the prior year period. Operating Expenses Total operating expenses for the first quarter of 2026 increased by 32.5% to RMB918.1 million (US$133.1 million) from RMB693.2 million for the prior year period. As a percentage of total net revenues, total operating expenses for the first quarter of 2026 were 89.9%, as compared with 83.2% for the prior year period. Fulfillment Expenses. Fulfillment expenses for the first quarter of 2026 were RMB61.1 million (US$8.9 million), as compared with RMB51.8 million for the prior year period. As a percentage of total net revenues, fulfillment expenses for the first quarter of 2026 decreased to 6.0% from 6.2% for the prior year period. The decrease was primarily due to further improvements in logistics efficiency. Selling and Marketing Expenses. Selling and marketing expenses for the first quarter of 2026 were RMB737.2 million (US$106.9 million), as compared with RMB553.8 million for the prior year period. As a percentage of total net revenues, selling and marketing expenses for the first quarter of 2026 increased to 72.2% from 66.4% for the prior year period. The increase was primarily driven by investments in broadening consumer awareness and building long-term brand equity of our core brands, coupled with higher traffic acquisition costs on the Douyin platform. General and Administrative Expenses. General and administrative expenses for the first quarter of 2026 were RMB80.3 million (US$11.6 million), as compared with RMB64.9 million for the prior year period. As a percentage of total net revenues, general and administrative expenses for the first quarter of 2026 were 7.9% as compared with 7.8% for the prior year period, remaining largely flat. Research and Development Expenses. Research and development expenses for the first quarter of 2026 were RMB39.4 million (US$5.7 million), as compared with RMB22.6 million for the prior year period. As a percentage of total net revenues, research and development expenses for the first quarter of 2026 increased to 3.9% from 2.7% for the prior year period. The increase was primarily driven by higher payroll expenses resulting from a rise in research and development headcount. Loss / Income from Operations Loss from operations for the first quarter of 2026 was RMB99.0 million (US$14.3 million), as compared with RMB34.1 million for the prior year period. Operating loss margin was 9.7%, as compared with 4.1% for the prior year period. Non-GAAP loss from operations[4] for the first quarter of 2026 was RMB84.6 million (US$12.3 million), as compared with RMB14.9 million for the prior year period. Non-GAAP operating loss margin[5] was 8.3%, as compared with 1.8% for the prior year period. Net Loss / Income Net loss for the first quarter of 2026 was RMB61.9 million (US$9.0 million), as compared with RMB5.6 million for the prior year period. Net loss margin was 6.1%, as compared with 0.7% for the prior year period. Net loss attributable to Yatsen's ordinary shareholders per diluted ADS[6] for the first quarter of 2026 was RMB0.64 (US$0.09), as compared with RMB0.06 for the prior year period. Non-GAAP net loss for the first quarter of 2026 was RMB57.3 million (US$8.3 million), as compared with non-GAAP net income of RMB7.1 million for the prior year period. Non-GAAP net loss margin was 5.6%, as compared with non-GAAP net income margin of 0.9% for the prior year period. Non-GAAP net loss attributable to Yatsen's ordinary shareholders per diluted ADS[7] for the first quarter of 2026 was RMB0.60 (US$0.09), as compared with non-GAAP net income attributable to Yatsen's ordinary shareholders per diluted ADS of RMB0.07 for the prior year period. Balance Sheet and Cash Flow As of March 31, 2026, the Company had cash, restricted cash and short-term investments of RMB934.2 million (US$135.4 million), as compared with RMB1.05 billion as of December 31, 2025. Net cash used in operating activities for the first quarter of 2026 was RMB90.0 million (US$13.0 million), as compared with net cash generated from operating activities of RMB23.8 million for the prior year period. Business Outlook For the second quarter of 2026, the Company expects its total net revenues to be between RMB1.20 billion and RMB1.30 billion, representing a year-over-year increase of approximately 10% to 20%. These forecasts reflect the Company's current and preliminary views on the market and operational conditions, which are subject to change. Exchange Rate This announcement contains translations of certain Renminbi ("RMB") amounts into U.S. dollars ("US$") at specified rates solely for the convenience of the reader. Unless otherwise noted, all translations from RMB to US$ were made at a rate of RMB6.8980 to US$1.00, the exchange rate in effect as of March 31, 2026, as set forth in the H.10 statistical release of The Board of Governors of the Federal Reserve System. The Company makes no representation that any RMB or US$ amounts could have been, or could be, converted into US$ or RMB, as the case may be, at any particular rate, or at all. Conference Call Information The Company's management will hold a conference call on Tuesday, May 26, 2026, at 7:30 A.M. U.S. Eastern Time or 7:30 P.M. Beijing Time to discuss its financial results and operating performance for the first quarter of 2026. The replay will be accessible through Tuesday, June 2, by dialing the following numbers: A live and archived webcast of the conference call will also be available on the Company's investor relations website at http://ir.yatsenglobal.com. About Yatsen Holding Limited Yatsen Holding Limited (NYSE: YSG) is a leading China-based beauty group with the vision of becoming a world-class pioneer in beauty innovation. Founded in 2016, the Company has launched and acquired numerous color cosmetics and skincare brands including Perfect Diary, Little Ondine, Pink Bear, Galénic, DR.WU (its mainland China business), and Eve Lom. Our brands are strategically positioned to capture a wide spectrum of consumer demographics and price points, ranging from the mass market to the prestige and clinical segments. Yatsen thrives on the synergy of brand equity, product strength and operational agility, anchored by a strong commitment to R&D and consumer insights. For more information, please visit http://ir.yatsenglobal.com. Use of Non-GAAP Financial Measures The Company uses non-GAAP income (loss) from operations, non-GAAP operating income (loss) margin, non-GAAP net income (loss), non-GAAP net income (loss) margin, non-GAAP net income (loss) attributable to ordinary shareholders and non-GAAP net income (loss) attributable to ordinary shareholders per diluted ADS, each a non-GAAP financial measure, in reviewing and assessing its operating performance. The presentation of these non-GAAP financial measures is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with U.S. GAAP. The Company presents these non-GAAP financial measures because they are used by the management to evaluate operating performance and formulate business plans. Non-GAAP financial measures help identify underlying trends in its business, provide further information about its results of operations, and enhance the overall understanding of its past performance and future prospects. The Company defines non-GAAP income (loss) from operations as income (loss) from operations excluding (i) share-based compensation expenses, (ii) amortization of intangible assets resulting from assets and business acquisitions and (iii) impairment of goodwill. Non-GAAP operating income (loss) margin is non-GAAP income (loss) from operations as a percentage of total net revenues. The Company defines non-GAAP net income (loss) as net income (loss) excluding (i) share-based compensation expenses, (ii) amortization of intangible assets resulting from assets and business acquisitions, (iii) revaluation of investments on the share of equity method investments, (iv) impairment of goodwill, (v) impairment of investments and (vi) tax effects on non-GAAP adjustments. Non-GAAP net income (loss) margin is non-GAAP net income (loss) as a percentage of total net revenues. The Company defines non-GAAP net income (loss) attributable to ordinary shareholders as net income (loss) attributable to ordinary shareholders excluding (i) share-based compensation expenses, (ii) amortization of intangible assets resulting from assets and business acquisitions, (iii) revaluation of investments on the share of equity method investments, (iv) impairment of goodwill, (v) impairment of investments, (vi) tax effects on non-GAAP adjustments and (vii) accretion to redeemable non-controlling interests. Non-GAAP net income (loss) attributable to ordinary shareholders per diluted ADS is computed using non-GAAP net income (loss) attributable to ordinary shareholders divided by weighted average number of diluted ADS outstanding for computing diluted earnings per ADS. However, the non-GAAP financial measures have limitations as analytical tools as the non-GAAP financial measures are not presented in accordance with U.S. GAAP and may differ from the non-GAAP information used by other companies, including peer companies, and therefore their comparability may be limited. The Company compensates for these limitations by reconciling the non-GAAP financial measures to the nearest U.S. GAAP performance measure, all of which should be considered when evaluating performance. The Company encourages investors and others to review its financial information in its entirety and not rely on a single financial measure. Reconciliations of Yatsen's non-GAAP financial measures to the most comparable U.S. GAAP measure are included at the end of this press release. Safe Harbor Statement This announcement contains statements that may constitute "forward-looking" statements which are made pursuant to the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as "will," "expects," "anticipates," "aims," "future," "intends," "plans," "believes," "estimates," "likely to," and similar statements. The Company may also make written or oral forward-looking statements in its periodic reports to the Securities and Exchange Commission ("SEC"), in its annual report to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Statements that are not historical facts, including statements about the Company's beliefs, plans, outlook and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: the Company's growth strategies; its future business development, results of operations and financial condition; its ability to continue to roll out popular products and maintain popularity of existing products; its ability to anticipate and respond to changes in industry trends and consumer preferences and behavior in a timely manner; its ability to attract and retain new customers and to increase revenues generated from repeat customers; its expectations regarding demand for and market acceptance of its products and services; its ability to integrate newly-acquired businesses and brands; trends and competition in and relevant government policies and regulations relating to China's beauty market; changes in its revenues and certain cost or expense items; and general economic conditions globally and in China. Further information regarding these and other risks is included in the Company's filings with the SEC. All information provided in this press release is as of the date of this press release, and the Company does not undertake any obligation to update any forward-looking statement, except as required under applicable law. For investor and media inquiries, please contact: Yatsen Holding LimitedInvestor RelationsE-mail: [email protected] View original content:https://www.prnewswire.com/news-releases/yatsen-announces-first-quarter-2026-financial-results-302781575.html

This article first appeared on GuruFocus. Total Net Revenue (Q4 2025): RMB1.38 billion, up 20.1% year-over-year. Skincare Brands Revenue (Q4 2025): Increased by 51.9% year-over-year. Color Cosmetics Brands Revenue (Q4 2025): Decreased by 9.1% year-over-year. Gross Profit (Q4 2025): RMB1.07 billion, up 20% year-over-year. Gross Margin (Q4 2025): 77.7%, largely flat compared to 77.8% in the prior year period. Total Operating Expenses (Q4 2025): Decreased by 15.6% to RMB1.08 billion. Net Income (Q4 2025): RMB3 million, compared to a net loss of RMB378.8 million in the prior year period. Net Income Margin (Q4 2025): 0.2%, compared to a net loss margin of 33% in the prior year period. Non-GAAP Net Income (Q4 2025): RMB41.2 million, compared to RMB107 million in the prior year period. Total Net Revenue (Full Year 2025): RMB4.3 billion, up 26.7% year-over-year. Gross Margin (Full Year 2025): 78.2%, up from 77.1% in the prior year period. Net Loss (Full Year 2025): RMB92.4 million, compared to RMB710.2 million in the prior year period. Net Loss Margin (Full Year 2025): 2.2%, down from 20.9% in the prior year period. Cash, Restricted Cash, and Short-term Investments (as of Dec 31, 2025): RMB1.05 billion. Net Cash Used in Operating Activities (Q4 2025): RMB69.4 million. Business Outlook (Q1 2026): Expected total net revenues between RMB958.6 million and RMB1.08 billion, representing a year-over-year increase of approximately 15% to 30%. Warning! GuruFocus has detected 3 Warning Signs with YSG. Is YSG fairly valued? Test your thesis with our free DCF calculator. Release Date: March 02, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Yatsen Holding Ltd (NYSE:YSG) reported a 20.1% year-over-year increase in total net revenue for the fourth quarter, significantly outpacing the industry average. Skincare brands accounted for 61.1% of total net revenues in the fourth quarter, driving the company's growth. The company achieved a non-GAAP net income margin of 0.2% for the full year 2025, marking a profitability turnaround. Yatsen Holding Ltd (NYSE:YSG) narrowed its full-year net loss margin to 2.2% from 20.9% in the prior year. The company's R&D-led product innovation and brand equity strengthening initiatives have contributed to its robust performance and profitability improvement. Net revenues from color cosmetics brands decreased by 9.1% year-over-year in the fourth quarter. Selling and marketing expenses increased to 64.8% of total net revenue in the fourth quarter, driven by higher traffic acquisition costs. Net cash used in operating activities for the full year of 2025 was RMB94.7 million, indicating cash flow challenges. The company's non-GAAP net income for the fourth quarter of 2025 was RMB41.2 million, down from RMB107 million in the prior year period. Yatsen Holding Ltd (NYSE:YSG) experienced intensified competition during major shopping festivals, impacting marketing costs. Q: How does Yatsen plan to improve its net profit margin in 2026? A: Donghao Yang, CFO, explained that Yatsen intends to continue growing its skincare business at a faster rate than its color cosmetics business. Skincare typically has higher gross and net margins, which will help improve the overall margin profile. Additionally, as the top line grows, operational leverage is expected to enhance net margins. Q: What are Yatsen's plans for expanding its skincare brand portfolio in 2026? A: Donghao Yang, CFO, emphasized the importance of R&D in expanding the skincare business. Yatsen has been investing heavily in R&D over the past several years, and this has contributed significantly to the growth of the skincare segment by developing products that meet consumer demands. Q: Can you provide an overview of Yatsen's financial performance for Q4 2025? A: Donghao Yang, CFO, reported that total net revenues for Q4 2025 increased by 20.1% year-over-year to RMB1.38 billion. This growth was primarily driven by a 51.9% increase in net revenues from skincare brands, despite a 9.1% decrease in color cosmetics. The company also achieved a net income of RMB3 million, marking a significant improvement from the previous year's net loss. Q: How did Yatsen's operational expenses change in Q4 2025? A: Donghao Yang, CFO, noted that total operating expenses decreased by 15.6% year-over-year to RMB1.08 billion. This reduction was due to lower general and administrative expenses, driven by decreased payroll and share-based compensation, as well as improved operational efficiencies. Q: What is Yatsen's outlook for the first quarter of 2026? A: Donghao Yang, CFO, stated that Yatsen expects total net revenues for Q1 2026 to be between RMB958.6 million and RMB1.08 billion, representing a year-over-year increase of approximately 15% to 30%. This forecast reflects the company's current views on market and operational conditions. For the complete transcript of the earnings call, please refer to the full earnings call transcript.