Shareholders who have suffered significant losses are urging the founders to accept a symbolic annual salary of just one yuan.
In late June, the annual general meeting of NAYUKI (HKEX: 02150) transformed into a forum for shareholder grievances. Founders Zhao Lin and Peng Xin were present to field a series of pointed questions from investors. Five years prior, the couple had led the company's celebrated listing on the Hong Kong Stock Exchange, earning the title of the world's first publicly listed new-style tea chain. However, as of July 2nd, the company's share price had plummeted by 96% from its peak, erasing over HK $30 billion in market value.
The meeting grew tense when a shareholder holding over four million shares, having incurred losses in the millions, directly challenged the management: "Why are NAYUKI's costs so much higher than its peers? Could the founders' compensation be tied to performance, perhaps reduced to a 1 yuan salary?" In response, the company clarified that since the IPO, founders like Zhao Lin have not sold any of their shares and have not realized high income from stock sales, admitting they "rely on their salaries" and that paying them 1 yuan is "unrealistic."
In 2025, Zhao Lin's annual salary was approximately 1.37 million yuan. Among the chairpersons of listed new tea beverage companies, this compensation level is notably restrained. For comparison, Mixue Bingcheng's Zhang Hongchao earned about 24.08 million yuan, Chabaidao's Wang Xiaokun around 2.61 million yuan, and Guming's Wang Yuan'an approximately 1.6 million yuan in the same period.
The shareholders' frustration is not without foundation. In 2025, NAYUKI's revenue was 4.331 billion yuan, a 12% year-on-year decline. A silver lining was a reduction in losses; the net loss for 2025 narrowed by 73.8% to 240 million yuan. Zhao Lin's team's strategy for reducing losses has involved drastic measures: shrinking the balance sheet, closing stores, and cutting expenses. By the end of 2025, the total number of NAYUKI tea shops had fallen to 1,646, a net reduction of 152 stores over the year.
More stark is the contrast with competitors who are rapidly expanding. In 2025, Mixue Bingcheng's revenue reached 33.56 billion yuan, Guming's was 12.9 billion yuan, and Chabaidao's approached 5.4 billion yuan. Among the four listed tea beverage firms, three saw growth in both revenue and net profit, while NAYUKI alone struggled with ongoing losses.
The disparity in store networks is even more pronounced. Mixue Bingcheng is nearing 60,000 stores, Guming exceeds 13,000, and Chabaidao has over 8,621. Part of NAYUKI's predicament stems from its dual-category "tea beverage + soft European bread" model. The founders initially insisted on in-store baking, which requires ovens, workstations, and bakers, leading to larger store footprints and higher labor costs that are difficult to reduce. This made it challenging for NAYUKI to compete as rivals rapidly expanded using smaller, more efficient store models.
The founders have adapted their strategy. Since 2022, most new NAYUKI stores have been converted to the PRO light store format, eliminating on-site baking in favor of pre-made baked goods from a central kitchen. However, this move has diluted the brand's distinctive offering, with revenue from baked products shrinking to 352 million yuan by 2025.
Zhao Lin and Peng Xin continue to refine their approach. They are focusing their direct-operated business on core cities like Shenzhen, Guangzhou, and Wuhan. The franchise strategy has also shifted from a pure pursuit of scale to seeking long-term, stable partners. To demonstrate confidence and support the share price, NAYUKI has initiated several share buybacks since June, spending millions of Hong Kong dollars, though the stock price has shown limited improvement.
Given the company's substantial cash reserves and signs of operational improvement, a return to previous highs remains difficult. However, the company retains a seat at the table and an opportunity for a turnaround—a prospect arguably more significant for shareholders than focusing on executive salaries in the millions.
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