ATRenew (RERE) has just reported its fourth quarter and full-year 2025 results. The company is doing well and the stock market has finally started appreciating this thanks to the recent stock rally. But the company is still not overvalued thanks to its growth potential. Let me analyze the company’s earnings results, its other news and the current valuations.
Earnings results
As I have mentioned above, both the quarterly and the annual earnings results were brilliant. For the 4Q 2025, the company expected its total revenues to be between RMB 6,080.0 million and RMB 6,180.0 million, a rise of 25.4% to 27.4% year-over-year. ATRenew’s sales for the last quarter of 2025 totaled RMB 6,254.2 million, substantially higher than the RMB 4,849 million reported for the same period a year ago. It was even higher than the figures that ATRenew had forecasted.
As concerns ATRenew’s full year 2025 earnings, the company’s net revenues increased by 28.9% to RMB 21,048.3 million compared to RMB 16,328.4 million for 2024. ATRenew’s quarterly net income totaled RMB 130.3 million, a rise of 68.3% from RMB 77.4 million compared to the same period of 2024. Adjusted non-GAAP net income totaled RMB 140.1 million, constituting a rise of 14.0% from RMB 122.9 million in the same period of 2024.
Here is how ATRenew’s Mr. Kerry Xuefeng Chen, the company’s CEO, comments on the recent earnings results: ” …By leveraging our integrated fulfillment network, combining a robust offline store presence with professional door-to-door services, we provided users with seamless recycling and trade-in experiences during the seasonal replacement wave following the autumn product launches. Our abundant first-hand sourcing, coupled with our compliant, value-added refurbishment capabilities, is accelerating our retail performance, enabling us to provide consumers with value-for-money quality products. Looking ahead, we remain committed to deepening our presence in the circular economy by enhancing transaction efficiency of pre-owned goods and delivering greater value for users.”
In other words, ATRenew’s positive earnings are also due to the company’s offline presence. Even though ATRenew mostly sells its second-hand goods, most notably electronics, online, its physical offline shops are also popular.
Mr. Rex Chen, ATRenew’s CFO also said: “ATRenew finished 2025 on a high note, delivering a standout fourth quarter. Our profitability continued to improve, with fourth quarter’s adjusted income from operations rising 38.1% year-over-year to RMB 181.5 million. The improvement reflected the economies of scale and enhanced operational efficiencies driven by robust technology and automation capabilities and supply chain optimization.” In other words, not only did ATRenew’s sales improve, also its efficiency increased.
As concerns the company’s revenue, the increase seems to be in line with history. As for the company’s income rise, it was very substantial compared to the previous periods. Let me illustrate just how well the company did, compared to its historical periods.
Moreover, apart from ATRenew’s share buyback program, now the company also pays dividends. On March 10, 2026, ATRenew’s management approved a dividend for the full year 2025 as part of its three-year shareholder return plan approved in August last year. The dividend payment date will be on or around April 24, 2026, in USDs, in an amount of $0.1 per ADS or $0.15 per ordinary share. The total amount of cash to be distributed would be close to $23.5 million.
ATRenew’s earnings and sales histories
The company has been reporting sustainable sales growth for a while. Only ATRenew’s GAAP profitability was not particularly excellent. However, now it is changing fast. This can be seen from the tables and diagrams below.
As can be seen from the company’s GAAP net profit history below, 2025 was the first period when ATRenew recorded a positive full-year GAAP net profit.
Annual sales and earnings figures (in million RMB)
Source: Prepared by the author based on ATRenew’s data
But if you see the annual sales graph below, you will see that ATRenew’s sales have been increasing evenly for many years in a row, which suggests sustainability.
Annual sales (in million RMB)
Source: Prepared by the author based on ATRenew’s data
Year 2025 was the first full year when the company’s GAAP net profit was positive, suggesting business performance improvements.
Annual GAAP net profit (in million RMB)
Source: Prepared by the author based on ATRenew’s data
But unlike the company’s GAAP net profit, non-GAAP net profit has been showing a very sound growth rate.
Annual Non-GAAP net profit (in million RMB)
Source: Prepared by the author based on ATRenew’s data
The same conclusions can be obviously drawn from the table and diagrams below showing ATRenew’s quarterly sales and earnings figures.
Quarterly sales and earnings history (in million RMB)
Source: Prepared by the author based on ATRenew’s data
Source: Prepared by the author based on ATRenew’s data
Since 3Q 2024 the company’s GAAP net profit has been positive and it now seems to be growing steadily.
Source: Prepared by the author based on ATRenew’s data
Since 2Q 2022, ATRenew’s non-GAAP net profit has also been growing.
Source: Prepared by the author based on ATRenew’s data
Upside factors
To start with, ATRenew is the market leader in China’s second-hand consumer electronics market. This niche has high-growth potential because of growing popularity of conscious consumption. At the same time, not many investors know about this investment opportunity, which offers great growth potential due to rising domestic demand in China. Right now in China, the mobile device recycling rate is only around 2%, which means it can rise much further, given the sustainability and conscious consumption trends.
The company has access to AHS Recycle, B2B distribution via PJT Marketplace, and B2C sales through Paipai, thus managing to become a standardized marketplace with transparent pricing and quality assurance. Moreover, ATRenew now operates more than 2,000 offline stores and eight operation centers almost in 300 cities, which means substantial economies of scale. The company also has a number of partnerships with major platforms and electronics producers, including JD.com (JD) and Apple (AAPL). These make ATRenew’s competitive position much stronger, thus providing barriers to entry, due to the company’s rivals’ inability to take advantage of such strong partners.
Even though ATRenew operates in a capital-intensive sector with high production costs, the company has managed to achieve net GAAP profitability. As I have mentioned above, the revenue growth has consistently been over 25% per year, while high profit growth has been supported by automation initiatives and improving economies of scale.
Downside risks
The profitability valuation ratios might suggest some overvaluation but this is due to the fact that the company’s profitability figures have only started being positive several quarters ago. Indeed, some very conservative investors might prefer to choose companies with very long profitability histories. However, they do not offer the growth potential that ATRenew does.
Also, some US-based investors might be afraid of buying shares of a China-based company due to the deteriorating trade relations between the US and China. During President Trump’s first term, it was broadly expected that Chinese companies would be delisted from major stock exchanges. However, this has not happened yet and may not happen any time soon.
Then, there is a general recession threat. But ATRenew’s business model is quite resilient to economic downturns simply because it focuses on selling second-hand electronics. Second-hand goods are often bought by lower-income consumers. So, even if there is a recession, the demand for second-hand goods, including electronics should rise, not fall, which would further support ATRenew’s business.
Valuations
One might argue that ATRenew is overvalued according to the classical profitability valuation ratios. But this is not true if we look at the company’s price/sales and EV/sales ratios. Moreover, from the company’s earnings we can clearly see that ATRenew’s profitability growth has only started.
Source: Seeking Alpha
Moreover, if we see the company’s stock price history, we will see that RERE stock is trading substantially below its high reached on the first day of trading after its IPO in New York about 5 years ago.
Source: Yahoo Finance
As can be seen from the graph above, ATRenew’s stock price has decreased by 69%, which means that ATRenew is nowhere overvalued.
Conclusion
In conclusion, I would say that ATRenew has reported a set of wonderful earnings results. RERE stock is still quite undervalued. The company now pays a dividend, while more price gains are yet to come due to the industry’s growth potential and ATRenew’s strong business model.
Source: https://www.fxstreet.com/news/atrenew-reports-a-set-of-impressive-results-202603130653
