AT Renew (RERE) Q2 2025: 32% Revenue Surge Anchored by 2,092-Store Expansion and Platform Leverage

2025-08-20 | By EarningsIQ Research

AT Renew delivered a standout Q2, outpacing guidance with 32% revenue growth and expanding its nationwide store network to over 2,000 locations. The company’s multichannel platform strategy and technology-driven fulfillment are accelerating its lead in China’s pre-owned electronics market. A newly announced three-year capital return plan and deepening brand partnerships set the stage for ongoing margin and scale advantages, even as management signals confidence in meeting full-year targets amid evolving subsidy dynamics.

Summary

• Store Network Scale-Up: Over 2,000 AHS stores now drive fulfillment and user reach across all city tiers.
• Platform Model Execution: Consignment, B2B, and multi-category recycling segments delivered double-digit growth and margin lift.
• Capital Return Commitment: New three-year plan returns at least 60% of annual profit to shareholders.

Performance Analysis

AT Renew’s Q2 performance decisively outpaced expectations, with total revenue reaching 4.99 billion RMB, up 32.2% year-over-year. This growth was propelled by a 34% jump in 1P (first-party) product revenue, underpinned by robust C2B (consumer-to-business) recycling and trade-in demand, and a 15.4% increase in 3P (third-party) service revenue, reflecting platform momentum. Margin expansion was evident in the 1P business, where gross margin rose to 13.2% from 12.1% a year ago, driven by higher-margin retail mix and compliant refurbishment.

Operational leverage is emerging as the store network scales, with fulfillment and marketing costs growing in line with volume but declining as a percentage of revenue. 1P2C (first-party to consumer) retail revenue surged 63.7% year-over-year, now accounting for over a third of product revenue. Platform take rates improved modestly, and the multi-category recycling business nearly doubled service revenue, highlighting the effectiveness of AT Renew’s multi-segment approach and supply chain integration.

• Fulfillment Network Expansion: Self-operated and joint stores now cover major urban and lower-tier geographies, supporting 90%+ order coverage in top cities.
• Refurbishment and Retail Mix: Refurbished products contributed 13.5% of 1P revenue, with new categories like laptops and smartwatches driving incremental GMV.
• Platform Take Rate Stability: Marketplace take rate held at 5.3%, with consignment GMV up 128% and multi-category recycling up nearly 110% year-over-year.

Cash reserves of 2.35 billion RMB and steady non-GAAP operating profit margin at 2.4% provide flexibility for reinvestment and shareholder returns. The company’s new $50 million share repurchase authorization and multi-year payout plan further reinforce financial discipline and capital return priorities.

Executive Commentary

Strategic Positioning

1. Multi-Channel Platform Leadership

AT Renew’s platform model, spanning 1P direct sales, 3P consignment, and B2B marketplace business (Paiji Tang), is delivering robust growth across all segments. The company’s consignment approach for small merchants and B2B supply chain openness have led to double-digit GMV growth and improved take rates. This multi-pronged strategy enables AT Renew to capture value from both product sales and service fees, while broadening its ecosystem and user base.

2. Store and Fulfillment Network Scale

With 2,092 AHS stores nationwide, including nearly 1,000 self-operated locations, AT Renew now handles 90% of orders in top-tier cities and 80% in lower tiers. This footprint supports rapid fulfillment, face-to-face service, and brand visibility, creating a closed-loop user experience that is difficult for competitors to replicate. The company is leveraging intelligent order dispatch and expanding its two-door team to manage volume spikes and promotional surges.

3. Supply Chain and Refurbishment Capability

Refurbishment is a key margin lever, with compliant operations now contributing 13.5% of 1P revenue. The addition of laptops and smartwatches to the refurbishment model generated over 100 million RMB GMV in the quarter. This expansion increases retail-ready inventory for proprietary channels and strengthens AT Renew’s value proposition for both users and brand partners.

4. Brand Partnerships and Ecosystem Integration

AT Renew’s deepening relationships with JD.com, Apple, Huawei, Xiaomi, and other leading brands enable exclusive trade-in programs and co-branded recycling initiatives. These partnerships drive user acquisition, supply quality, and subsidy-driven volume, while new collaborations with platforms like Alipay and Douyin broaden the funnel for recycling supply and user engagement.

5. ESG and Circular Economy Commitment

With its fifth annual ESG report, AT Renew set ambitious carbon reduction targets (35% for scope 1 and 2, 50% for scope 3 by 2030) and launched the “Green Wallet” to reward eco-friendly behavior. This positions the company as a sustainability leader and aligns its business model with regulatory and consumer trends favoring circular consumption.

Key Considerations

AT Renew’s Q2 demonstrates the power of integrated platform execution, but investors should monitor the pace of margin improvement, the durability of subsidy-driven demand, and the scalability of the fulfillment network as the business moves deeper into lower-tier markets and new product categories.

Key Considerations:

• Scale and Density Advantage: The company’s store expansion and fulfillment density are driving operational leverage and user experience gains, but expansion costs and personnel investments bear watching.
• Platform Take Rate and Mix Shift: Consignment and B2B growth are improving take rates, but future growth will depend on maintaining quality and service standards across a broader merchant base.
• Brand and Policy Tailwinds: National subsidies and brand partnerships have fueled recent growth, but normalization of these drivers could moderate growth rates in future quarters.
• Capital Return and Cash Discipline: The new shareholder return plan and buyback authorization signal confidence, but also raise expectations for sustained profit delivery and prudent reinvestment.

Risks

Subsidy dependency and policy volatility remain key risks, as national trade-in incentives and brand-funded promotions have materially boosted volumes. Execution risk in lower-tier cities—where fulfillment density and staffing are still below target—could limit user experience improvements. Margin pressure from ongoing investment in brand, technology, and store expansion may weigh on near-term profitability if revenue growth slows or competitive intensity rises.

Forward Outlook

For Q3 2025, AT Renew guided to:

• Total revenue of 5.05 to 5.15 billion RMB, representing 24.7% to 27.1% YoY growth

For full-year 2025, management reiterated confidence in meeting or exceeding operational and growth targets, referencing:

• Ongoing investment in brand and fulfillment capabilities
• Expectation of scale effects driving margin improvement in 2026 and beyond

Management cited September new device launches and continued brand partnerships as catalysts for H2 growth, while reiterating a focus on maximizing recycling capability and brand equity over the next 24 months.

Takeaways

AT Renew’s Q2 performance validates its platform and fulfillment-centric strategy, with scale and technology driving margin and revenue outperformance. The company’s multi-year capital return plan and ESG leadership enhance its investment case, but future growth will hinge on continued operational execution and adaptation to policy and consumer shifts.

• Store and Platform Scale: The accelerated expansion to 2,092 stores underpins both volume growth and user experience differentiation, but requires ongoing investment and operational discipline.
• Margin Leverage and Mix: Margin gains are being realized through higher-value retail and refurbishment, but the sustainability of these gains depends on execution in new categories and lower-tier geographies.
• Watch for Policy and Consumer Shifts: Investors should monitor the evolution of subsidy policies and the normalization of trade-in as a mainstream consumer behavior, as these will shape future demand and growth trajectories.

Conclusion

AT Renew’s Q2 results reflect a business firing on multiple cylinders—platform, fulfillment, and brand—while maintaining capital discipline and signaling long-term confidence through shareholder returns. The company is well-positioned for continued growth, but must sustain operational execution and navigate evolving subsidy and consumer dynamics to realize its full potential.

Industry Read-Through

AT Renew’s results and commentary reinforce the accelerating mainstream adoption of circular economy models in China’s electronics sector. The company’s ability to scale fulfillment, deepen platform integration, and partner with leading brands sets a template for others in recommerce and adjacent consumer sectors. Policy-driven demand and user education remain critical levers, but the company’s margin and scale performance signal that platform and supply chain integration are becoming decisive competitive advantages for any player seeking to lead in the secondary market or broader circular economy. Investors in recommerce, retail, and consumer electronics should watch for similar platform shifts and policy tailwinds across the sector.

RERE Consumer Discretionary Recommerce Platform Fulfillment Refurbishment Shareholder returns ESG