ZTO Express reported third‑quarter 2025 results that included a 9.8% year‑over‑year increase in parcel volume to 9.57 billion, a 5% rise in adjusted net income to RMB 2.51 billion, and operating cash flow of RMB 3.21 billion. Revenue reached RMB 11.86 billion, up 11% from the prior year but slightly below the consensus estimate of RMB 11.91 billion, reflecting a modest shortfall in core express revenue offset by strong growth in retail parcel volume.
The company’s adjusted earnings per share of RMB 3.06 surpassed analyst expectations of RMB 2.42–2.64, a beat of roughly RMB 0.42–0.64 per share. The outperformance was driven by disciplined cost management and a favorable mix shift toward higher‑margin retail deliveries, which helped offset the decline in gross margin from 31.2% to 24.9% as unit costs rose and the company served more key accounts and non‑e‑commerce volume.
Gross margin compression was the most significant headwind. The drop to 24.9% from 31.2% was largely attributable to higher unit costs, including increased labor and fuel expenses, and a strategic shift toward servicing larger, more demanding customers that require more complex logistics solutions. This mix shift reduced pricing power in the core express segment.
In light of the macro‑economic uncertainty and the industry’s move toward quality‑driven competition, management lowered its annual parcel volume guidance to 38.2 billion–38.7 billion parcels, representing 12.3%–13.8% growth. The revision signals caution about near‑term demand while maintaining confidence in the company’s ability to sustain profitability through cost discipline.
CEO Meisong Lai emphasized that the company’s focus on quality and network stability remains central to its strategy, noting that retail parcel volume grew nearly 50% year‑over‑year and contributed positively to margins. CFO Huiping Yan highlighted that combined unit sorting and transportation costs fell by RMB 0.05, and that SG&A costs stayed structurally stable at 5.3% of revenue, underscoring ongoing operational efficiency efforts.
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