Live Coverage of Haidilao's Earnings Conference: After Founder Zhang Yong Regains Leadership, Haidilao's Breakthrough and Restructuring

Ask AI · How does Zhang Yong’s return as CEO accelerate Hai Di Lao’s strategic optimization?

Original | Yongliu Business Author | Li Wei

The chill in the food and beverage market has not yet lifted. With Hai Di Lao’s founder Zhang Yong resuming the role of CEO, this signals that the 32-year-old catering giant is entering a new phase of defense and counterattack. Hai Di Lao’s 2025 performance weaves together revenue growth and profit pains; through these results, outsiders can see a rebuild at the underlying layer.

On March 24, Hai Di Lao released its 2025 full-year results. In a complex environment marked by evolving dining-consumption demand and intensified competition, the group’s revenue reached 43.23 billion yuan, up 1.1% year over year; core operating profit was 5.4 billion yuan, down 13.3% year over year; and net profit was 4.04 billion yuan, down 14% year over year.

At the March 25 performance meeting, Zhou Zhaoxing, Vice Chairman of the Board and Executive Director, emphasized that profit fluctuations were mainly driven by strategic investments, including product innovation, upgrades to restaurant experience, and ramping up new business formats. More specifically, this is the company’s proactive investment made based on long-term development.

The biggest highlight of this performance is not the data itself, but the fact that the founder, Zhang Yong, returned to the CEO position on January 13, 2026. Zhang Yong stepped down as CEO in March 2022, with professional managers Yang Lijuan and Gou Yiqun taking over in succession. In early 2026, Zhang Yong returned to the front line.

At the performance meeting, Zhou Zhaoxing explained the rationale in detail: “Right now, the company—including the entire catering industry—is actually in a period of upgrading competition, and we are also actively exploring a key phase for the second growth curve within the company… Mr. Zhang Yong’s return to the CEO role can more effectively consolidate consensus across the entire workforce, clarify the strategic direction, and accelerate the group’s overall business optimization and upgrades.”

This adjustment does not change the existing strategy; it only improves execution efficiency and the directness of information transmission. The three key work focuses for Zhang Yong and management are clear: solidifying the core main brand, advancing the Hongshiliu plan to incubate new projects, and using intelligent technology to build breakthroughs in the middle office (middle platform).

Main business: stable fundamentals, profits slide back

The macro environment remains full of challenges, and consumer demand is evolving rapidly. Hai Di Lao’s 2025 results reflect the cost of transformation. During the period, the group’s total revenue reached 43.23 billion yuan, achieving 1.1% year-over-year growth. Hai Di Lao’s restaurants remain the absolute mainstay, with restaurant revenue accounting for 86.9% of overall revenue.

But the profit side faced clear pressure. Core operating profit recorded 5.4 billion yuan, down 13.3% year over year; net profit was 4.04 billion yuan, down 14% year over year. At the performance meeting, management gave a clear definition: this is not deterioration in operations, but strategic proactive investment for long-term development. To better meet customer needs, Hai Di Lao introduced more new products with strong value for money, which inevitably affected gross margin performance in the short term. Meanwhile, increasing material inputs brought by service-experience upgrades also raised phased costs.

The table-turnover data confirms the resilience of the core business. Hai Di Lao’s直营 hot pot restaurants had an average table-turnover rate of 3.9 times per day; this is a slight drop from the previous year’s 4.1 times, but it still sits in a healthy range. Table-turnover rates in Tier 1, Tier 2, and cities below Tier 3 all remained at 3.9 times, indicating an evenly balanced distribution of customer flow. The average spend per customer was 97.7 yuan, up slightly by 0.2 yuan.

Second growth curve: delivery and Hongshiliu

While the core business remains solid, Hai Di Lao’s new growth engines have already started. The delivery business is especially eye-catching: full-year delivery revenue was 2.66 billion yuan, up a strong 111.9% year over year, accounting for 6.1% of total company revenue.

Rice-bowl hot pot dishes became breakout hits, contributing more than 70% of delivery revenue, with a year-over-year growth rate of over 300%. Hai Di Lao has finally penetrated high-frequency consumption scenarios such as solo diners and workday meals. In the future, delivery categories will further expand into stir-fried dishes, fast food, noodles, and more, creating a dual engine of both dine-in and delivery-to-home.

The Hongshiliu plan has formally moved from internal lab experiments to a broader market. By the end of 2025, the group operated 20 sub-brands and 207 stores. Other restaurant operating revenue totaled 1.52 billion yuan, of which the Hongshiliu plan contributed about 0.89 billion yuan.

Some projects show extremely strong breakout potential. Yanqing Korean barbecue is one example. By the end of 2025, it had 80 stores, with full-year revenue of 480 million yuan; it is still being refined for a long-term profit model.

The seafood-based big-dish stall brand focused on extreme value for money currently operates 8 locations. In its stores in Nanning and Guangzhou, table-turnover rates are stable at more than 6 and 5.5, respectively. Management believes this model has the potential to reach a scale of 500 stores over the next three years. The sushi project is still in the early stage, but the table-turnover rate per store has already exceeded 6 times. Leveraging existing supply-chain advantages, the sushi business is expected to open 100 stores within two years.

Overall, in the Hongshiliu plan, a small number of brands are already profitable, while others are in early-stage losses. The company will not set specific store-opening targets; it will first run the store formats until they are fully “tested and calibrated.” Brands performing poorly will be adjusted promptly. After Zhang Yong’s return, this plan has been placed at an even higher priority, with hopes of accelerating incubation efficiency.

Underlying logic evolution: pursuing extreme value for money

Price wars in the catering industry are becoming increasingly intense. Hai Di Lao has chosen a different path: the company’s core future direction will focus on extreme value for money. This is not simple low-price competition; it improves overall experience by integrating the supply chain, optimizing products, and operating digitally.

This strategic shift is directly reflected in the cost structure. In 2025, raw material and consumables costs rose to 40.5% of the total, up 2.6 percentage points year over year. This was mainly affected by the rising share of delivery, franchising, and new restaurant business under the Hongshiliu plan. Excluding new businesses, the cost of hot pot ingredients for the main brand increased by only 0.9 percentage points, because more fresh-cut and live seafood products were introduced.

Labor cost control shows strong resilience as well. Total labor cost as a share was 32.6%, down 0.4 percentage points year over year. Piece-rate wage systems and flexible labor employment mechanisms have played a role. Property rent as a share remained stable at 1%, while depreciation and amortization continued to decline due to reuse of store assets and the actual 5–10 year usage period.

Supporting the huge business matrix is a deep organizational-structure transformation. Hai Di Lao is bidding farewell to standardized templates and moving toward diversified store formats. The front-of-house is given fuller autonomy as the “combat unit,” and product decision-making power has been delegated to regional teams; localized featured products have accumulated to more than 100 SKUs.

The middle-office (middle platform) system has been reshaped, and intelligent replenishment ordering and precise inventory management have been implemented. The management model is undergoing a deep transition from reliance on experience to data-driven decision-making.

In terms of store expansion, Hai Di Lao still adheres to the cautious principle of ensuring quality. As of the end of 2025, the total number of stores was 1,383, including 1,304 self-operated stores and 79 franchised stores. During the year, 79 new self-operated stores and 21 franchised stores were opened; meanwhile, 85 stores that underperformed expectations were closed or relocated. In 2026, the growth rate of newly opened stores is expected to remain in the mid-single digits.

On the financial side, the board recommended paying a final cash dividend of HK$0.384 per share, with the total dividend paid for the year reaching HK$3.91 billion. Compared with the previous year, the dividend payout ratio decreased slightly, but it still remains at a relatively high level.

Hai Di Lao has gone through 32 years—from a small shop in Sichuan to a global chain across multiple cycles. When Zhang Yong takes the helm again, what he leads is not only a hot pot chain, but a large organization trying to reshape the catering format by leveraging the supply chain and an intelligent middle platform. From relying on single-store expansion to multi-brand synergy, Hai Di Lao’s business logic is being restructured.