ATRenew (NYSE: RERE) reported Q2 2026 net revenues of RMB6.609 billion, up 32.4% year over year, while diluted net income per ordinary share increased to RMB0.80 from RMB0.44. GAAP operating income nearly doubled to RMB178.3 million as product revenue expanded 35.9%, although service revenue declined and inventory rose materially from year-end.
Core Financial Results
Revenue growth came primarily from online sales of pre-owned consumer electronics. Net product revenue increased by RMB1.636 billion, while service revenue declined by RMB18.2 million because ATRenew offered discretionary service-fee discounts to merchants during the extended 618 promotional period.
Operating costs and expenses rose 31.0%, slightly slower than revenue. Selling and marketing, general and administrative, and research and development expenses all grew more slowly than the top line, helping GAAP operating margin increase to approximately 2.7% from 1.8%.
| Metric | Q2 2026 | Q2 2025 | YoY Change |
|---|---|---|---|
| Total net revenues | RMB6,609.3 million | RMB4,991.5 million | +32.4% |
| Net product revenues | RMB6,194.7 million | RMB4,558.7 million | +35.9% |
| Net service revenues | RMB414.6 million | RMB432.8 million | -4.2% |
| Operating income | RMB178.3 million | RMB91.1 million | +95.7% |
| Adjusted operating income | RMB206.3 million | RMB121.3 million | +70.1% |
| Net income | RMB129.1 million | RMB72.3 million | +78.6% |
| Diluted income per ordinary share | RMB0.80 | RMB0.44 | Approx. +81.8% |
| Adjusted diluted income per ordinary share | RMB0.97 | RMB0.61 | Approx. +59.0% |
Adjusted operating income and adjusted per-share results are non-GAAP measures that exclude share-based compensation and acquisition-related intangible asset amortization, as well as applicable tax effects for adjusted net income.
Business and Revenue Mix
Product revenue represented approximately 93.7% of total revenue, up from 91.3% a year earlier. Management attributed the increase to ATRenew’s first-party supply chain model, a higher proportion of compliant refurbished products, online sales, and broader distribution of pre-owned products across global markets.
The number of consumer products transacted increased to 11.6 million from 10.3 million, an approximately 12.6% increase. This operating metric is measured before returns and cancellations, excludes products collected through AHS Recycle, and may count the same product more than once as it moves through the distribution process.
Service revenue moved in the opposite direction, falling 4.2% as merchant discounts reduced service fees during the extended 618 promotion. The divergence indicates that ATRenew’s quarterly growth was concentrated in product sales rather than marketplace and other service monetization.
Product-Led Growth Lifted Margin While Inventory Expanded
ATRenew generated operating leverage because several expense categories increased more slowly than revenue. Fulfillment expenses rose 31.1% because of higher personnel, logistics, and operating-center costs, while selling and marketing expenses increased 24.8%. General and administrative and research and development expenses each rose 23.5%.
GAAP profit growth exceeded adjusted profit growth partly because acquisition-related intangible asset amortization fell to RMB0.8 million from RMB17.9 million. Share-based compensation moved in the other direction, increasing to RMB27.3 million from RMB12.3 million.
Below the operating line, the share of losses from equity-method investments increased to RMB19.2 million from RMB10.0 million, while other income swung from RMB4.8 million to a RMB5.7 million loss. These items help explain why net income grew more slowly than operating income.
The product-led mix also coincided with a larger inventory position. Inventory reached RMB1.467 billion at June 30, 2026, up approximately 36.6% from RMB1.074 billion at December 31, 2025. Short-term borrowings increased approximately 41.2% to RMB455.9 million, while cash, restricted cash, short-term investments, and funds receivable from payment providers edged down to RMB2.157 billion from RMB2.187 billion.
During the quarter, ATRenew repurchased approximately 1.0 million ADSs for US$4.2 million. Cumulative repurchases under the program reached approximately 3.3 million ADSs for US$14.8 million, leaving US$35.2 million available as of June 30. The board extended the program for another 12 months beginning June 30, 2026.
Q3 2026 Guidance
ATRenew expects Q3 revenue growth to remain above 20%, though the projected range implies slower expansion than Q2’s 32.4% increase. At the midpoint, the guidance calls for approximately RMB6.39 billion of revenue and 24.1% year-over-year growth.
| Metric | Q3 2026 Guidance | Implied YoY Change |
|---|---|---|
| Total revenues | RMB6,340 million–RMB6,440 million | +23.1% to +25.1% |
Management Commentary
Founder, Chairman, and CEO Kerry Xuefeng Chen emphasized the company’s first-party supply chain, improved recycling and trade-in experience, increased supply of compliant refurbished devices, and broader global distribution. These initiatives supported the product revenue expansion during the quarter.
CFO Rex Chen highlighted upgrades to AHS store capabilities, stronger door-to-door recycling fulfillment, optimized sales channels, disciplined brand marketing, and tighter middle- and back-office cost management. These priorities were consistent with the quarter’s faster profit growth and wider operating margin.
Recent Insider Transaction
The supplied insider transaction data includes one recent transaction with a clear direction, quantity, price, and value. The transaction should be viewed objectively without assuming a motive for the sale.
| Date | Insider | Role | Action | Quantity | Price | Value |
|---|---|---|---|---|---|---|
| June 10, 2026 | Zhu Rui | Director | Sale | 4,762 shares | US$4.00 | US$19,048 |
Risks Investors Should Monitor
- Inventory and funding requirements: Inventory rose approximately 36.6% from year-end while short-term borrowings increased and the company’s combined liquid-resource balance declined slightly. Further product-led expansion will make these balance-sheet trends important to monitor.
- Pressure on service monetization: Service revenue fell because of promotional discounts. Continued discounting could limit the contribution from service fees even if transaction activity grows.
- Slower guided revenue growth: Q3 guidance implies 23.1% to 25.1% growth, below Q2’s 32.4%. Maintaining operating leverage may become more difficult if personnel, fulfillment, and logistics costs continue to rise as growth moderates.
- Non-operating losses: Larger equity-method investment losses and the swing to other losses reduced the extent to which operating profit growth flowed through to net income.
Summary
ATRenew’s Q2 2026 growth was led by first-party product sales, while disciplined expense growth helped operating profit rise much faster than revenue. The main follow-up issues are whether the company can deliver its Q3 growth range, preserve the recent operating-margin improvement, stabilize service revenue, and manage higher inventory and short-term borrowing without weakening liquidity.
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