So-Young International Inc.
Analysis
So-Young has stopped being a booking platform that takes a cut and become a clinic chain, one that is only now learning to make money clinic by clinic. The whole story hangs on whether the chain reaches group profit before the cash it is spending on it runs short.How much of group revenue will come from clinics next year?
- The clinic chain has become the company and the old platform is shrinking.
Clinic revenue passed half the group for the first time in Q4 FY2025 and is now about two-thirds of it, while the subscription side shrinks by a third a year. So-Young pays its own rents and doctors now, so results track its own clinics.
- Clinics earn more the longer they stay open.
Clinic gross margin rose to 28.1% in Q2 FY2026 and same-store sales grew 52%, against 14% a year earlier, so growth no longer depends only on opening new doors. That is what makes the planned openings pay for themselves.How many more centres must turn profitable before the group does?
- The openings are paid for out of the cash pile, not the business.
Losses narrowed 37% in Q2 FY2026 but are still losses, and cash has fallen from about RMB 1.25 billion at the end of 2024 to RMB 848 million. Opening clinics is paid for out of that pile, so profit is a deadline rather than a preference.How long can openings run at this rate before cash gets tight?
- Clinic unit economicsThe bull case is that the company-owned clinics have shown they can make money at the center level, so growth now depends on how fast that model is copied into new cities.
- Supply chain and exclusive productsBuying for the whole chain and launching exclusive products with manufacturers gives So-Young lower consumable costs and repeat visits that a single clinic cannot arrange.
- Referral-led customer acquisitionMost new patients arrive through referrals from existing ones rather than paid advertising, so the chain can keep opening clinics without acquisition costs eating the gains.
- Shrinking platform businessThe bear case is that the reservation platform, which once supplied the group's profit, keeps losing paying providers while the clinic chain is still being paid for.
- Cash consumed by expansionEvery new clinic absorbs capital before it earns, so the group's cash balance has fallen while the network is still far from the size management says it wants.
- Losses at group levelAt the group level So-Young still reports net losses, and the clinic segment's profitability has repeatedly been described as approaching rather than reached.
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Congressional trading data provided by QuiverQuant
How So-Young International turned ¥1.5B of revenue into ¥727.7M of gross profit.
| Revenue | ||
|---|---|---|
| Service, Other | ¥81.0M | |
| Total revenue | ¥1.5B | |
| Gross profit | ¥727.7M | 47.8% |