Recently, Bear Electric released its 2025 financial results, reporting a total annual operating revenue of 5.235 billion yuan, marking a 10.02% year-on-year increase. Net profit attributable to the parent company reached 401 million yuan, up by 39.17%, while the growth rate of net profit excluding non-recurring items hit 46.66%. On the surface, the company’s performance demonstrates a clear picture of steady revenue growth and significant profit increases, positioning it as a highly competitive player in the small home appliance sector.

However, beyond the immediate impression of short-term financial data, a deeper analysis of the performance composition, quarterly fluctuations, and underlying business logic reveals that this rapid growth heavily relies on human input in internal management. The company also faces multiple challenges, including cyclical industry changes, external expansion, and category transformation. The core issue lies in the competition between operational efficiency and market pressure.

The Disparity Between Profit Growth and Revenue Growth

In 2025, Bear Electric’s net profit surged by over 40% year-on-year, while revenue increased by 10%. The significant gap between profit growth and revenue growth has become a focal point of attention.

The company attributed the notable increase in profit margins to the synergistic effects of mergers and acquisitions (M&A) and the optimization of expense ratios. These two key factors jointly drove the company’s restored profitability. From a practical standpoint, the effects of expense control were most evident. The reduction in sales expenses stemmed partly from the dilution effect caused by revenue scale expansion and partly from refined management of marketing investments. This cost-saving operational optimization significantly enhanced the reported profit performance in the short term, demonstrating the company’s strong cost control and internal operational capabilities.

At the same time, the optimization of the product mix also contributed to the rise in gross profit margins, playing a crucial role in driving profit increases. The company further expanded its profit margins by adjusting its product lines and raising average product prices. However, the sustainability of the current rise in gross profit margins must be viewed rationally, as external environmental pressures persist.

In the fourth quarter of 2025, the phase-out of national subsidy policies for home appliance consumption led to a temporary decline in market consumer demand. Given the gradual reduction in overall industry demand, the company’s pricing power may be directly affected by market acceptance. To maintain stable market sales in the future, the company may need to increase promotional efforts and offer more discounts. Consequently, the current high gross profit margins could face internal pressure from price reductions. The marginal benefits of growth driven solely by efficiency optimization and product price increases are expected to gradually decline.

Divergence Between Revenue and Profit in Q4: Industry Cyclical Imprints Amid Short-Term Fluctuations

Sina Finance reported that quarterly statistics revealed a significant difference between income and profit for Bear Electric in the fourth quarter of 2025. Total revenue for the quarter decreased by 4.65% year-on-year, while profit performance continued to rise against the trend.

As a traditional peak sales season for the home appliance industry, the revenue decline in the fourth quarter was not exceptional, primarily attributable to two objective factors. First, the high base effect from the acquisition of Roman Smart in the previous year and the increased overseas export rush. Second, the temporary rebound in consumer demand after the phase-out of national subsidies. These two factors jointly caused short-term fluctuations in sales revenue for the quarter.

Although profit performance remained stable, reflecting strong execution in cost control and expense management, the short-term slowdown in revenue highlighted the cyclical nature of the company’s core kitchen small appliance business. Currently, the company’s main business remains deeply entrenched in the kitchen small appliance sector, where demand is easily impacted by external factors such as macroeconomic consumption policies and market sentiment. The ability to sustain endogenous growth amid cyclical fluctuations still needs further strengthening.

Looking ahead to the 2026 performance trend, once the incremental dividends from M&A are exhausted, it will be challenging for the company to fill the revenue gap without leveraging the sustained recovery momentum of the external consumer market. Whether the company can rely on its own endogenous growth to compensate for the revenue shortfall remains to be observed.

External Expansion and Overseas Layout: Balancing Incremental Dividends and Potential Risks

External expansion played a crucial supporting role in Bear Electric’s 2025 performance growth. By acquiring Roman Smart, the company filled gaps in its personal care product category, thereby enhancing its product matrix. The synergistic effects of the merger gradually manifested during the year, contributing to incremental revenue and profit. However, the task of M&A integration is long-term, and both parties are still in the early stages of business integration. The so-called synergistic effects are currently more evident in financial statement consolidation and initial channel linkages. Future costs associated with cultural integration, channel resource optimization, and management structure adjustments will persist. The effectiveness of controlling these hidden costs will directly determine the long-term value of external expansion.

The rapid growth of overseas business is similarly a double-edged sword. On the one hand, overseas market expansion has opened up incremental space for the company, becoming an important engine for revenue growth. On the other hand, overseas business is highly susceptible to external factors such as geopolitics and tariff policies. Combined with the high base effect from the previous export rush, the stability of subsequent growth rates faces challenges.

Compared to the mature domestic market, overseas markets are characterized by policy uncertainty and greater trade risks. How to control the pace of overseas expansion and mitigate risks is a theme that the company should prioritize and address in its future efforts.

The Challenge of Transitioning from a Single Category to a Diversified Layout

To reduce its reliance on the single category of kitchen small appliances, Bear Electric has been advancing its strategic transformation by gradually expanding into emerging categories such as maternal and child care and personal care. It aims to transition from a company focused on kitchen small appliances to a brand covering various lifestyle scenarios. This strategic trend aligns with the diversification trend in the small home appliance industry, expanding the company’s long-term growth potential. Meanwhile, emerging categories have shown strong growth momentum in the past two years.

However, from the perspective of actual category expansion, the transformation still faces numerous practical challenges.

The shift from operating best-selling single products to a full-category matrix places higher demands on the company’s supply chain management, cross-category R&D capabilities, and multi-brand operational capabilities. Currently, although emerging categories are growing significantly, their overall scale remains small, making it difficult to fully offset the cyclical fluctuations of traditional kitchen small appliance categories. At the same time, competition in the emerging sectors of personal care and maternal and child care is fierce, with challenges from both traditional home appliance giants and emerging brands. Bear Electric’s first-mover advantage in these sectors is not prominent, and the effectiveness of category expansion still requires time to validate.

Long-Term Performance Remains to Be Tested

Overall, Bear Electric’s 2025 performance reflects the company’s active exploration and phased achievements in internal control, resource integration, and category expansion. Measures such as expense optimization and M&A synergies have significantly restored the company’s profitability, demonstrating strong operational resilience. At the same time, factors such as slowing revenue growth, quarterly fluctuations, risks associated with external integration, and pressure from category transformation reveal certain vulnerabilities in the company’s growth, which has not yet escaped industry cycles or reliance on a single category.

For the market, greater attention should be paid to the sustainability of the company’s revenue growth, the long-term effectiveness of M&A integration, and the company’s ability to maintain high profit margins.

For Bear Electric, 2025 was a year of restoring operational efficiency and tackling transformation challenges. Whether it can break through growth bottlenecks in the future hinges on cultivating endogenous growth drivers and achieving synergies across diversified categories. This growth journey still requires steady progress.