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Investing.com - ZTO Express (Cayman) Inc. (NYSE:ZTO) reported first quarter 2025 results on Tuesday that fell short of analyst expectations, as revenue growth slowed amid intense competition in China’s express delivery market.
The Chinese logistics company posted adjusted earnings per American depositary share (ADS) of RMB2.71 ($0.37), missing the analyst consensus of RMB2.93. Revenue rose 9.4% YoY to RMB10.89 billion ($1.50 billion), below estimates of RMB11.68 billion.
While parcel volume grew 19.1% YoY to 8.54 billion packages, average selling price per parcel declined 7.8% as ZTO increased volume incentives to compete in what CEO Meisong Lai called a "white-hot" competitive environment.
"Competition in China’s express delivery industry has reached the ’white-hot’ stage, and it is further exacerbated by a greater portion of volume being either low value or loss-making for the logistic service providers," Lai said.
Despite the earnings miss, ZTO’s adjusted net income rose 1.6% to RMB2.26 billion ($311.3 million).
The company maintained its full-year 2025 parcel volume guidance of 40.8 billion to 42.2 billion packages, representing 20-24% YoY growth.
CFO Huiping Yan noted that cash flow from operations was RMB2.4 billion in Q1, while capital spending totaled RMB2 billion.
ZTO also extended its share repurchase program through June 2026, with $771.7 million remaining under the current $2 billion authorization.
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