Gross Profit Growth Nearly Doubles: How Laopuhuangjin Withstands Premium Valuation Ceiling

On March 23, Lao Pu Gold Co., Ltd. (hereinafter referred to as “Lao Pu Gold”) released its annual financial report ending December 31, 2025, achieving double growth in revenue and gross profit. Offline stores contributed 82.9% of total revenue, making them the core sales channel. Industry insiders believe that gold brands have shifted from selling products to building brands, transitioning from price-setting based on gold prices to independent corporate pricing. In the future, gold brands will compete in product design and brand value.

The financial report shows that in 2025, Lao Pu Gold’s revenue reached 27.303 billion yuan, a 220% increase from 8.506 billion yuan in 2024; gross profit rose from 3.501 billion yuan in 2024 to 10.274 billion yuan in 2025, a 193.4% increase; net profit grew from 1.502 billion yuan in 2024 to 5.029 billion yuan in 2025, a 234.9% year-over-year increase, with significant improvement in profitability.

From the channel perspective, offline stores contributed 82.9% of total revenue, remaining the core sales channel. Meanwhile, online revenue share further increased compared to 2024, reaching 17.1%. Lao Pu Gold stated that its online and offline performance growth mainly stems from the brand’s market absolute advantage, product innovation and iteration, as well as revenue contributions from the addition of 10 new stores and the optimization and expansion of 9 stores during the reporting period. Currently, Lao Pu Gold has 610,000 members, a 74.3% increase year-over-year, with a continuously expanding consumer base.

In terms of offline layout, as of December 31, 2025, Lao Pu Gold had opened 45 directly operated stores across 16 cities in China, all located in well-known commercial centers including SKP and MixC, aiming to compete for high-net-worth individuals by entering top consumer landmarks and vying with international luxury brands.

According to Frost & Sullivan data, in 2025, among global luxury groups, Lao Pu Gold ranked first in China in both store sales per square meter and sales efficiency per store. Its consumer overlap rate with international top luxury brands like Louis Vuitton and Hermès reached 82.4%.

However, Zhou Ting, president of Ho客 Research Institute, stated that currently, Lao Pu Gold still lags behind luxury brands. Its success relies more on market dividends rather than core brand competitiveness. The company’s performance growth is still affected by gold price fluctuations and lacks the cyclical resilience that luxury brands possess. Essentially, it remains a gold sales brand that needs to strengthen its brand power and reduce dependence on gold price volatility.

Despite adopting a “fixed price” strategy, Lao Pu Gold is also affected by gold price fluctuations. After two price adjustments in 2025, rising gold prices led to a decline in the group’s gross profit margin to 37.6%. However, after the third price adjustment in October 2025, the gross profit margin rebounded to above 40%.

Lao Pu Gold stated that short-term fluctuations in gross profit margin have not impacted the group’s revenue. Currently, compared to most domestic gold brands priced based on “gold price + labor cost,” Lao Pu Gold’s gross profit margin is higher, but it still lags behind international luxury jewelry brands with gross margins reaching 60%.

“All operational assumptions of Lao Pu Gold are based on the premise that gold prices will continue to rise, which is clearly not the case,” Zhou Ting said. She believes that gold prices cannot always go up; if gold prices decline significantly, Lao Pu Gold may face substantial performance pressure and cash flow risks.

Western Securities pointed out that currently, gold jewelry has shifted from a channel-driven model to a product and brand-driven model. Lao Pu Gold positions itself in the high-end traditional gold track, deeply integrating Chinese traditional culture with modern design and fashion concepts. With a clear positioning, a rising brand momentum, and vibrant product offerings, it quickly captures consumer attention.

Zhou Ting believes that the underlying logic of domestic high-end gold jewelry brands is fundamentally a value system based on gold material, with craftsmanship and culture as added values. This provides some brand premium space. However, the ceiling of this premium largely depends on brand strength built through artistic interpretation, trend innovation, and social symbolic value. Most high-end gold brands in China still focus on craftsmanship and cultural accumulation, mainly producing craftworks that lack the irreplaceable artistic value needed to support high premiums. Only brands that truly strengthen their brand power and align product value with pricing can maintain a long-term foothold in the high-end market.

Beijing Business Daily reporter Liu Zhuolan, intern reporter Mao Siyi