JXR (1951.HK), often referred to as the first listed in-vitro fertilization (IVF) service provider, released its fiscal year 2025 results on Thursday evening, revealing a challenging landscape for the entire assisted reproductive services industry.
Despite the report, JXR's stock price rose by 2.20% on Friday to close at HK$2.32 per share, marking its fourth consecutive day of gains. The company's total market capitalization stands at HK$6.368 billion.
The annual report indicates that JXR's revenue for 2025 was RMB 2.6491 billion, a decrease of 5.8% compared to RMB 2.8116 billion in 2024.
However, the situation was far more severe regarding net profit. JXR reported a net loss of RMB 983.9 million for 2025, a stark reversal from the net profit of RMB 273.5 million recorded in 2024. In terms of net profit attributable to owners of the parent, the loss was RMB 976.1 million for 2025, compared to a profit of RMB 283.1 million the previous year. Data shows this is the company's first annual loss since 2017, effectively erasing the cumulative net profits earned over the past three years from 2022 to 2024.
Even when calculated using the non-IFRS adjusted net profit metric, which excludes non-cash, non-operational, or one-time items, the company's 2025 profit was RMB 209.3 million. This represents a significant decline of 49.7% from the RMB 416.3 million reported in 2024. Additionally, the basic loss per share for 2025 was RMB 0.36. Gross profit fell by 19.4% from RMB 1.0995 billion in 2024 to RMB 886.5 million in 2025, while the gross profit margin decreased from 39.1% to 33.5%.
What caused such a sharp decline in performance within a single year? The company provided a candid explanation in its report. The decrease in revenue was attributed to two main factors: a reduction of approximately RMB 122.7 million in revenue from Assisted Reproductive Services (ARS), and a decrease of about RMB 54.6 million in revenue from obstetric-related services. The primary reasons for these declines were a 1.4% drop in Oocyte Pick-Up (OPU) cycles coupled with an approximate 6.5% decrease in the average price per cycle within China following national healthcare policy adjustments, leading to lower ARS revenue. Furthermore, a 31.6% decline in traditional deliveries due to reduced birth意愿 in China resulted in decreased obstetric-related income. A breakdown of the data shows that ARS and obstetric-related service revenues fell significantly by 6.2% and 15.5% year-on-year, respectively, with the latter experiencing a more pronounced drop.
Regarding the profit decline, JXR explained it was mainly due to "one-time events," partially compounded by a decrease in operating profit. These one-time events included impairments related to goodwill and certain intangible assets associated with its US and Laos operations, impairment losses recognized on certain financial assets, and one-time capital injections or renovations for the Jinjiang District Maternal and Child Health Hospital, Wuhan JXR Hospital, and the old campus in Shenzhen. The decline in operating profit was attributed to three factors: downward pricing pressure on ARS following its inclusion in China's medical insurance coverage, adverse conditions in China's obstetric industry, and increased expenses related to business expansion in the United States.
Elaborating on the second factor, the report noted that China's birth population has been declining continuously from 2019 to 2025. According to National Bureau of Statistics data, the birth population accelerated its decline post-pandemic to approximately 8 million. This trend is attributed to multiple factors, including slowing economic growth after the pandemic, tightened regulations in the real estate sector, and fundamental demographic shifts. JXR concluded that the interplay of these factors has distorted the short-term growth trajectory of the assisted reproductive market and fueled skepticism about a medium-term overall decline in the market.
This challenging environment for JXR is not entirely unexpected. Based on historical data from the National Bureau of Statistics, China's birth population fell below 8 million in 2025 to a record low of 7.92 million, a significant decrease of 1.62 million (approximately 17%) from 2024. The birth rate entered the "5-era" at 5.63‰, which is half the peak rate of 12.95‰ recorded in 2016. This demographic shift has evidently placed substantial pressure on JXR's operations.
Despite these difficulties, JXR maintains an optimistic outlook. The company stated that against the backdrop of a global decline in birth rates, assisted reproduction represents one of the more certain medium-to-long-term growth opportunities. According to SAC Insight data, the global IVF market was valued at $3.156 billion in 2025 and is projected to reach $10.466 billion by 2032, representing a compound annual growth rate of 18.7%, a rarity among many industries. Overall, the penetration rate of ARS in China remains significantly lower than in developed countries. In 2025, China's ARS penetration rate was only about 10.5%, far below the rates of 36.5% in Europe and 34.5% in the United States.
Furthermore, there are some positive domestic developments. According to the latest marriage registration data released by the Ministry of Civil Affairs on February 11, 2026, the number of marriage registrations reached 6.763 million couples, an increase of 10.76% compared to 2024. A recent report from Frost & Sullivan predicts that China's newborn population likely bottomed out in 2025 and may be at a turning point, with the number of newborns expected to gradually stabilize and experience a slight rebound in the future.
Concurrently, JXR is actively expanding its overseas operations. In the United States, the company is strengthening its "physician partnership" strategy and expects to have 40 physician partners in its US business by 2027. In Southeast Asia, JXR acquired PT Morula Indonesia, the largest assisted reproductive center in Indonesia—the most populous country in the region with 280 million people—which holds approximately a 40% market share, to consolidate its position in the Southeast Asian ARS market.
In a related development, JXR Group's sister company, JXR Healthcare Industry Group Co., Ltd., formally submitted an application for an initial public offering on the Hong Kong Stock Exchange on February 25 this year. According to Frost & Sullivan statistics, as of September 30, 2025, JXR Healthcare ranked first among all major participants in China's institutional elderly care service industry and was the top professional private chain elderly care enterprise in China. A successful listing would mean the JXR Group would have two listed companies on the Hong Kong exchange.
Comments