Shenwan Hongyuan released a research report maintaining a "Buy" rating on 361 DEGREES (01361), noting the company has over two decades of deep cultivation in the sports industry. In recent years, it has accelerated the enhancement of its internal capabilities across products, branding, and channels. The ongoing brand upgrade is progressing steadily, with the effects of channel optimization gradually becoming apparent. Against the backdrop of consumption stratification, the company's products combine the advantages of high cost-effectiveness and strong functionality. With its channels predominantly located in lower-tier markets, and driven by short-term sports event catalysts coupled with the company's long-term efficient operations, it is expected to continue achieving growth that outpaces the industry, increase its market share, and maintain promising future development prospects. Shenwan Hongyuan's key views are as follows:
The company released its Q4 2025 operational data, showing continued high sales growth in the fourth quarter, driven by synergistic efforts across multiple channels. In the fourth quarter of 2025, 361 DEGREES' offline retail sales for both adult apparel and children's wear increased by approximately 10% year-on-year, continuing the growth trend from the first three quarters. E-commerce sales grew by a high double-digit percentage, exceeding expectations. Against the backdrop of an overall industry slowdown in Q4, the company continued to demonstrate strong growth momentum, highlighting the resilience of its omni-channel growth and showcasing the competitive advantages of its high quality-to-price positioning and new channel layouts such as Super Brand Stores.
Inventory remained at reasonable levels, and the discount rate remained stable. The discount rate in the fourth quarter stabilized at 30-29% off (original price), continuing the trend from the third quarter. The inventory-to-sales ratio was maintained in the range of 4.5-5 times, indicating healthy levels and overall stable operational conditions.
The expansion of Super Brand Stores exceeded expectations, becoming a new engine for offline growth. As of December 31, 2025, the number of Super Brand Stores reached 126 (including 21 children's wear stores), with the store opening progress exceeding expectations. The first overseas Super Brand Store grandly opened in Cambodia, marking a new step in international expansion. Super Brand Stores possess significant advantages: each store covers an area of 800-1,200 square meters (equivalent to 5 regular stores), the proportion of new customer acquisitions reaches 60%-70%, and they account for 50% of stores in first- and second-tier cities, effectively complementing the traditional stores that primarily cover lower-tier markets. The sell-through rate and the rate of additional purchases are significantly higher than in regular stores, while operating costs are noticeably lower. In 2026, Super Brand Stores will become the main focus of store expansion, penetrating uncovered commercial complexes and continuously fueling growth as a showcase for the brand image and a highlight of the offline presence.
Product iteration and intensified marketing efforts continue to enhance brand momentum. On the product front, the company adheres to a strategy of high-quality, rapid iteration and a high quality-to-price positioning. In the running category, the new competitive racing family, including the "Feiran 5" and "Feiran 5 FUTURE," was launched. The 361° Supai family's 3rd generation received a comprehensive upgrade, with the "Supai FLOAT3" utilizing the new CQT midsole technology for improved protection and rebound acceleration. The high-performance dual-density cushioning trail running shoe "Lingci 1st Generation" was launched, providing runners with exceptional grip and foot protection in mountainous terrain. In the basketball category, Aaron Gordon's sixth signature basketball shoe, the "AG6," was released, and Nikola Jokić's second signature basketball shoe, the "JOKER2," made its debut in the United States, achieving strong sales conversion leveraging Jokić's personal influence. In marketing, on December 26th, the "Brand Day," the company officially announced a renewed partnership with the Olympic Council of Asia, commencing a new cycle of strategic collaboration. It also further established in-depth strategic cooperation with Kanglun Aerospace and Tianjin University of Sport, integrating aerospace technology and sports science resources to jointly promote the development of competitive sports. Furthermore, the company became the official supplier for the 2025 WTCC World Tennis Continental Cup, supporting the high-standard presentation of this top-tier international tennis event.
One Way is accelerating its layout to capitalize on the outdoor热潮 (boom). The One Way brand was founded in Finland in 2004, with products covering equipment and apparel for winter sports and professional cycling. 361 DEGREES established a joint venture with One Way at the end of 2013, responsible for expanding the outdoor market in Greater China, initially holding a 70% stake, later increased to 100%. The One Way brand underwent some adjustments in previous years due to pandemic disruptions but began repositioning its product line in the second half of 2024 to adapt to the current broad outdoor trend. In the fourth quarter, the brand opened 6 new offline stores, increasing its physical presence. The store area is approximately 100-140 square meters, with around 120 SKUs covering professional skiing, outdoor, and general outdoor products. The product functionality is comparable to top international brands but with more competitive pricing. Plans for 2026 include launching more footwear and women's products, potentially opening a second growth curve under the current outdoor trend.
Risk warnings include intensified industry competition; risks associated with terminal demand and seasonal fluctuations; and risks that new business expansion may fall short of expectations.
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