When the running track gets crowded, how far can Xtep still go?

Ask AI · How do Anta and Li Ning’s running strategies challenge Xtep’s market position?

Jiemian News Reporter | Qin Lixin

On March 26, Xtep announced its full-year 2025 performance. The financial report shows that in 2025, the group’s total revenue increased by 4.2% to RMB 14.151 billion, with net profit rising by 10.8% to RMB 1.372 billion. On March 26, at the close of Hong Kong stocks, Xtep’s share price fell sharply by nearly 7%.

In the report, Xtep stated that the revenue in 2025 was mainly driven by the steady performance of its main brand and strong growth in the professional sports division.

Specifically, in 2025, revenue from Xtep’s main brand (representing the Xtep brand) was RMB 12.515 billion, up 1.5% year-over-year, accounting for 88.4% of total revenue; the professional sports division (representing brands like Saucony and Myle) generated RMB 1.636 billion, up 30.8%, accounting for 11.6%.

Regarding gross profit, both the main brand and the professional sports division saw slight declines in gross margin compared to 2024. In 2025, gross profit from the main brand increased marginally by 0.1% to RMB 5.155 billion, with a gross margin of 41.2%, down 0.6 percentage points year-over-year. The company explained that the gross profit growth in this segment was mainly driven by e-commerce sales, but to support sales, it increased promotional subsidies and discounts for authorized distributors, which pressured overall gross margins.

For the professional sports division, gross profit grew 27.0% to RMB 908 million, with a gross margin of 55.5%, down 1.7 percentage points. Xtep attributed the decline in gross margin to an increased proportion of low-margin apparel sales.

From the performance structure, it’s clear that running remains Xtep’s core growth driver. The company focuses on the mass market with its main brand, while Saucony targets high-end consumers. Xtep Chairman and CEO Ding Shuibo said that the brand has fully covered consumers from mass to elite levels, claiming that Xtep is China’s number one running brand.

However, the running market is becoming increasingly crowded. Domestic brands like Anta and Li Ning have significantly increased their investments in professional running in recent years, whether in product R&D, event sponsorship, or runner community operations, intensifying competition.

Li Ning’s 2025 financial report shows that running has surpassed its traditional strength, basketball, to become its largest category, accounting for 31% of revenue; professional running shoes sales exceeded 26 million pairs. Anta, leveraging its international expansion strategy, launched the “PG7 Shock Absorption Global Plan,” deepening engagement with runner communities in key cities like Boston, San Francisco, Chicago, New York, and Los Angeles, to accelerate global brand recognition in the running market.

Anta Co-CEO Lai Shixian also stated at the 2025 earnings presentation that Anta will continue to increase investment in running. He also admitted, “Although the running market is crowded, it is still a large track with stable growth potential in the future.”

iiMedia Research data shows that in 2024, China’s sports footwear and apparel market reached RMB 542.5 billion, expected to grow to RMB 896.3 billion by 2030, but the growth rate is slowing. As running shifts from a “high-growth track” to a “high-competition track,” Xtep’s previously prominent differentiation advantages may face dilution.

In response, Xtep continues to invest heavily in marathon event resources, targeting elite runners, attempting to strengthen brand awareness through the “professional influence on the mass market” approach. Xtep disclosed that its running shoes have ranked first for four consecutive years among Chinese male marathoners and third among female marathoners. At the Tokyo Marathon in March 2026, Xtep ambassador Feng Peiyou broke the national record and became Asia’s number one, leading Chinese marathon into the ‘205’ era.

However, Guojin Securities pointed out that compared to sports with mature league systems like basketball and football, running (including sprints, long-distance, and marathons) has more dispersed endorsement audiences globally and lacks centralized events and exposure platforms. The influence of individual stars is relatively limited. This means that among brand endorsers of running shoes, some faces may be relatively unfamiliar to the general public. Guojin Securities believes this provides growth opportunities for new brands.

Indeed, a number of emerging domestic running brands have appeared, such as Bimai and Mondo. Mondo founder Ai Guoyong told Jiemian News that the company entered the running shoe market in 2020 and has been continuously iterating its products. Its “Jogger Shoes 2.0,” launched last September, features a self-developed high-width last design, optimizing comfort and feel. The brand also has several other running shoes in development.

From a strategic perspective, Xtep has also tried to expand growth through multiple brands. The company previously launched K-Swiss, Palladium, and other brands to cover more segments like sports fashion and lifestyle, but overall results were limited. It eventually scaled back these businesses to refocus on running, which improved strategic clarity but also meant growth would rely more on a single track.

In this context, Saucony is expected to serve as a “second growth curve.” Jiemian News noted that in 2025, Saucony further expanded its product range, launching lifestyle products including the Woolly sports lifestyle wool series and a collaboration with artist Jae Tips called “Flowers Grow Uptown,” emphasizing street fashion and daily comfort.

Xtep stated that Saucony, a century-old running shoe brand, has established a high-end image among running and mid-to-high-end consumers. While continuing to strengthen professional running products, the brand will also expand its clothing and lifestyle product lines that have received positive market feedback. However, extending from professional running to lifestyle means Saucony will enter a more complex competitive arena.

Overall, using running as a core foundation and pushing high-end and structural upgrades through Saucony, Xtep’s growth path is becoming clearer. But with industry growth slowing and competition intensifying, the challenges of this path are increasingly evident.

When “Number One in Running” is no longer rare, Xtep may need to answer not just how to maintain growth, but how to continuously build differentiated advantages in an increasingly crowded track.