Net Revenues Increased 41.5% to RMB6,278.1 Million in the First Quarter

Average Monthly Transacting Customers Increased 103.2% Compared to the Same Period Last Year

More than 2,300 Net New Stores Openings; Expanded to More than 18,500 Stores in China

BEIJING, April 30, 2024 — Luckin Coffee Inc. (“Luckin Coffee” or the “Company”) (OTC: LKNCY) today announced its unaudited financial results for the three months ended March 31, 2024.

FIRST QUARTER 2024 HIGHLIGHTS1

  • Total net revenues in the first quarter were RMB6,278.1 million (US$869.5 million), representing an increase of 41.5% from RMB4,436.7 million in the same quarter of 2023.
  • Net new store openings during the first quarter was 2,342, including two new store openings in Singapore, resulting in a quarter-over-quarter store unit growth of 14.4% from the number of stores at the end of the fourth quarter of 2023, ending the first quarter with 18,590 stores which include 12,199 self-operated stores and 6,391 partnership stores.
  • Average monthly transacting customers in the first quarter was 59.9 million, representing an increase of 103.2% from 29.5 million in the same quarter of 2023.
  • Revenues from self-operated stores in the first quarter were RMB4,579.6 million (US$634.3 million), representing an increase of 45.8% from RMB3,140.4 million in the same quarter of 2023.
  • Same-store sales growth for self-operated stores in the first quarter was negative 20.3%, compared to 29.6% in the same quarter of 2023.
  • Store level operating profit – self-operated stores in the first quarter was RMB320.8 million (US$44.4 million) with store level operating profit margin of 7.0%, compared to RMB791.6 million with store level operating profit margin of 25.2% in the same quarter of 2023.
  • Revenues from partnership stores in the first quarter were RMB1,508.0 million (US$208.9 million), representing an increase of 32.8% from RMB1,135.4 million in the same quarter of 2023.
  • GAAP operating loss in the first quarter was RMB65.1 million (US$9.0 million), representing a GAAP operating margin of negative 1.0%, compared to GAAP operating income of RMB678.4 million, or a GAAP operating margin of 15.3%, in the same quarter of 2023. Non-GAAP operating income in the first quarter, which adjusts for share-based compensation expenses, was RMB5.0 million (US$0.7 million), representing a non-GAAP operating margin of 0.1%, compared to RMB730.5 million, or a non-GAAP operating margin of 16.5%, in the same quarter of 2023. The decreases were mainly attributable to the reduced average selling price of the Company’s products and continued volatility in market dynamics and competition, coupled with the negative impact from seasonality.

COMPANY STATEMENT

Dr. Jinyi Guo, Chairman and Chief Executive Officer of Luckin Coffee, said, “We are pleased to report strong topline growth with increases in our total net revenues, net new store openings, and average monthly transacting customers. Such growth was accomplished despite seasonality headwinds and increased competition. We opened 2,342 net new stores in this quarter, including two new ones in Singapore, bringing our total store count to 18,590 by the end of March. While continuously resonating well with our existing base, we also demonstrate our ability to attract new customers by adding 22.9 million new transacting users in this quarter. In addition, the launch of production at our new Jiangsu Roasting Plant marked another important milestone for the Company, which further cements our leading position in China. With an annual roasting capacity of 30,000 tons, the plant is one of the largest coffee roasters in China. Furthermore, this plant demonstrates our commitment to ESG as it is designed to meet the Three-Star Standards for Green Buildings of China. Looking ahead, we will continuously take decisive actions to navigate any headwinds and deliver sustained value to our shareholders.”

FIRST QUARTER 2024 FINANCIAL RESULTS

Total net revenues were RMB6,278.1 million (US$869.5 million) in the first quarter of 2024, representing an increase of 41.5% from RMB4,436.7 million in the same quarter of 2023. Net revenues growth was primarily driven by the increase in the number of products sold, the increase in stores in operation and the increase in the number of monthly transacting customers.

  • Revenues from product sales were RMB4,770.2 million (US$660.7 million) in the first quarter of 2024, representing an increase of 44.5% from RMB3,301.3 million in the same quarter of 2023.
    • Net revenues from freshly brewed drinks were RMB4,351.8 million (US$602.7 million), representing 69.3% of total net revenues in the first quarter of 2024, compared to RMB2,934.3 million, or 66.1% of total net revenues, in the same quarter of 2023.
    • Net revenues from other products were RMB308.1 million (US$42.7 million), representing 4.9% of total net revenues in the first quarter of 2024, compared to RMB244.6 million, or 5.5% of total net revenues, in the same quarter of 2023.
    • Net revenues from others were RMB110.2 million (US$15.3 million), representing 1.8% of total net revenues in the first quarter of 2024, compared to RMB122.4 million, or 2.8% of total net revenues, in the same quarter of 2023.
  • Revenues from partnership stores were RMB 1,508.0 million (US$208.9 million) in the first quarter of 2024, representing 24.0% of total net revenues, which was an increase of 32.8% compared to RMB1,135.4 million, or 25.6% of total net revenues, in the same quarter of 2023. For the first quarter of 2024, revenues from partnership stores included sales of materials of RMB1,105.3 million (US$153.1 million), sales of equipment of RMB159.0 million (US$22.0 million), profit sharing of RMB119.3 million (US$16.5 million), delivery service of RMB109.2 million (US$15.1 million) and other services of RMB15.2 million (US$2.1 million).

Total operating expenses were RMB6,343.3 million (US$878.5 million) in the first quarter of 2024, representing an increase of 68.8% from RMB3,758.4 million in the same quarter of 2023. The increase in total operating expenses was predominantly the result of the Company’s business expansion, including opening of new stores and strategic investments in branding and promotional activities, etc. Meanwhile, operating expenses as a percentage of net revenues increased to 101.0% in the first quarter of 2024 from 84.7% in the same quarter of 2023, mainly due to the increase in store rental costs, labor costs and cost of materials as a percentage of net revenues resulting from decreased average selling price of the Company’s products.

  • Cost of materials were RMB2,944.4 million (US$407.8 million) in the first quarter of 2024, representing an increase of 67.8% from RMB1,754.7 million in the same quarter of 2023, which was generally in line with the increase in the number of products sold and the increase in sales of materials to partnership stores.
  • Store rental and other operating costs were RMB1,833.3 million (US$253.9 million) in the first quarter of 2024, representing an increase of 105.6% from RMB891.7 million in the same quarter of 2023, mainly due to the increase in labor costs, store rental costs as well as utilities and other store operating costs as a result of the increased number of stores in operation and items sold in the first quarter of 2024 compared to the same period last year.
  • Depreciation and amortization expenses were RMB259.4 million (US$35.9 million) in the first quarter of 2024, representing an increase of 139.2% from RMB108.5 million in the same quarter of 2023, mainly due to the increase in amortization of leasehold improvements for the stores and the increase in depreciation expenses of additional equipment put into use in new stores in the first quarter of 2024.
  • Delivery expenses were RMB447.8 million (US$62.0 million) in the first quarter of 2024, representing an increase of 6.2% from RMB421.7 million in the same quarter of 2023, mainly due to the increase in the number of delivery orders.
  • Sales and marketing expenses were RMB325.8 million (US$45.1 million) in the first quarter of 2024, representing an increase of 63.4% from RMB199.4 million in the same quarter of 2023, mainly driven by the increase in (i) advertising expenses as the