Yunji (NASDAQ:YJ) reported a narrower first-half net loss as it reduced expenses and shifted its merchandise mix toward private-label and organic-health offerings, though management said consumer spending and the broader market environment in China remained challenging.
Chairman and Chief Executive Officer Shanglue Xiao said the company continued to pursue a “dual-engine” strategy centered on products and customer experiences, with particular emphasis on organic health, organic food, beauty and skincare, and supply-chain traceability initiatives.
Merchandise Mix Shifts Toward Private Label
Xiao attributed the revenue pressure to Yunji’s efforts to optimize its merchandise assortment, including ending relationships with certain third-party merchants whose products did not meet the company’s enhanced standards. He said the changes affected near-term revenue but were intended to support Yunji’s longer-term organic-health strategy.
Self-operated merchandise accounted for approximately 70% of total sales during the period, according to Xiao, while private-label products represented 56% of self-operated merchandise sales. He said higher-margin private-label products are increasingly serving as a core source of revenue support.
Gross margin was about 41% in the first half, according to both executives. Song said the margin was supported by the company’s selection of premium, high-retention categories and private-label offerings.
Yunji said it is prioritizing products in the food-medicine homology category, which it described as serving the health needs of modern Chinese families. Xiao highlighted Polygonum tea, launched in the fourth quarter of 2025, as the company’s first flagship offering in that category. He said the product experienced rapid sales growth in the first half and helped validate Yunji’s approach to the wellness market, though the company did not provide sales figures for the product.
Beauty and Food Categories Show Product Momentum
In organic food, Yunji said it has focused on daily consumption occasions, particularly breakfast, as a way to acquire customers. Xiao said the food category complements its organic-health products by combining higher-frequency and lower-frequency purchase patterns.
Within beauty and skincare, Xiao said sales were broadly stable from a year earlier. He said consumers increasingly favor products that offer value at more affordable prices, a trend he said aligns with the positioning of Yunji’s SUYE brand.
SUYE Skincare Condensing Essence Oil, launched in the second half of 2025, generated 29% sequential sales growth in the first half of 2026, Xiao said.
The company also continued to invest in supply-chain traceability events, which it views as a differentiator from traditional e-commerce platforms and a tool for improving customer trust and repurchase conversion. Yunji held about 30 such events in the first half.
- A traceability event for Baiyue Shan birch sap on April 13 helped lift first-half sales of the product by 128% from a year earlier and 146% from the second half of 2025, according to management.
- A June 17 event for Baiyue Shan wolfberry puree contributed to a 13% year-over-year increase in first-half sales and a 366% increase compared with the second half of 2025, the company said.
Loss Narrows as Expenses Decline
Yunji’s net loss narrowed to RMB72.4 million from RMB100.7 million in the prior-year period. Adjusted net loss was RMB72.3 million, compared with RMB100.5 million a year earlier. Basic and diluted net loss per share both improved to RMB0.04 from RMB0.05.
Loss from operations narrowed to RMB39.4 million from RMB100.4 million, as total operating expenses fell 38.8% to RMB109.7 million from RMB139.4 million.
Song cited lower warehousing, logistics, personnel, member-management and promotion costs, as well as reduced technology and content spending. General and administrative expense declined to RMB47.5 million from RMB93.4 million, primarily because of a lower allowance for credit losses on a third-party loan receivable, partially offset by higher property and equipment impairment.
As of June 30, Yunji had RMB242.1 million in cash, cash equivalents, restricted cash and short-term investments, compared with RMB216.1 million at the end of 2025.
Looking ahead, management said Yunji plans to expand its food-medicine homology lineup, devote more resources to high-margin and high-repurchase products, strengthen its experiential offerings and maintain cost discipline as it works to improve operating margins and balance growth with profitability.
About Yunji (NASDAQ:YJ)
Yunji Inc is a China-based social commerce company that operates a membership-focused e-commerce platform. The company offers a curated selection of lifestyle products, positioning itself as a bridge between manufacturers and end consumers. By combining technology with a membership community, Yunji aims to deliver a personalized shopping experience that emphasizes quality, affordability and social interaction.
The platform’s product portfolio spans beauty and personal care, health and wellness, household essentials, food and beverage, apparel and accessories.
