Luckin Coffee doubles profits and outlets in record breaking 2023

Luckin Coffee surpassed Starbucks’ annual sales in China last year by nearly $350m | Photo credit: P.L. 

Beijing-based Luckin Coffee achieved surging sales and accelerated outlet growth last year to extend its market lead in the booming Chinese branded coffee shop market. 
 

The value-focused operator posted 87% year-on-year sales growth to RMB 24.9bn ($3.5bn) in the 12 months ended 31 December 2023, with profits reaching RMB 3bn ($426m) compared to RMB 1.1bn ($167m) in 2022. 

Underpinned by a nimble store footprint – including a strong network of delivery and pick-up only sites – Luckin Coffee opened 8,034 net new stores last year to reach 16,248 outlets. Thirty of the new stores were opened in Singapore – currently Luckin’s only international market. 

The brand’s 98% year-on-year outlet growth saw the percentage of company-operated stores in its network fall slightly from 69% at the end of 2022 to 65%. 

Alongside strong sales and outlet growth, Luckin Coffee also reported a 124% rise in average monthly transacting customers in 2023 to 48.4 million. 

“We delivered another year of strong operational and financial performance, resulting in record high revenue up 87% from the year prior and advancing our pricing and expansion strategies in 2023. The number of Luckin Coffee stores doubled from the previous year, reaching a new record-high, and reinforcing our position as the coffee chain brand with the largest number of stores in China,” said Dr. Jinyi Guo, CEO, Luckin Coffee. 

Luckin Coffee surpassed Starbucks’ annual sales in China last year by nearly $350m – the first time it has done so. 

The value-focused coffee chain achieved 0.8% quarter-on-quarter sales growth in its fourth quarter, while Starbucks, which reached 7,000 stores in China earlier this year, saw revenues in the east Asian country fall 12.5% to $735m in its comparative quarter. 

Luckin Coffee’s continued pursuit of value is chiming with more Chinese consumers than ever before as the country experiences an economic slowdown and high youth unemployment. 

The Beijing-based coffee chain prices beverages between RMB 10-20 ($1.40-$2.75) and is currently locked in a price war with rival operators Cotti Coffee, with both chains consistently seeking to undercut prices. Meanwhile, Starbucks has retained its focus on premium beverages, with a menu that starts at around RMB 30 ($4.10). 

World Coffee Portal research shows the total Chinese branded coffee shop market exceeds 50,000 stores – making it the largest in the world.