Atour Lifestyle Holdings, the Shanghai hotel group that also sells the pillows and quilts used in its rooms, said third-quarter retail revenue jumped 61% to 1.36 billion yuan ($203 million), lifting total net revenue 30.5% to 3.43 billion yuan even as its older hotels earned less per room.

The results, released on Nov. 10, show where the Nasdaq-listed company's growth is coming from. Bedding accounted for almost two-thirds of the revenue Atour added in the quarter, and most of it is sold online, according to business columns carried by Chinese outlet Jiemian News. The hotels that built the brand are filling fewer rooms at lower prices once new openings are stripped out. For investors reading Chinese household spending through company reports (see also Capital Times coverage of Luckin and Yum China), Atour offers two signals in one set of accounts: a branded home product that is selling fast, and a travel business where established outlets are under price pressure.

Atour's retail arm closes in on hotels

Retail revenue was 1,362 million yuan, up from 846 million yuan a year earlier, the company said. That was 39.7% of net revenue, against 32.2% in the same quarter of 2025. Revenue from manachised hotels, Atour's term for properties it franchises and manages for outside owners, rose 20.4% to 1,878 million yuan. The gap between the two businesses has narrowed to about 516 million yuan.

Of the roughly 801 million yuan in revenue Atour added from a year earlier, retail supplied about 516 million yuan, or 64%, according to Capital Times calculations from the company's figures.

Retail is also the more profitable line. Retail costs were 47.9% of retail revenue, implying a gross margin of 52.1%, slightly below the 52.7% of a year earlier. Hotel operating costs took 62.1% of hotel revenue. The price of that growth shows up further down: selling and marketing expenses rose to 529 million yuan from 355 million yuan, or 15.4% of net revenue against 13.5%, which the company tied to brand spending and online channels for the retail business.

Founder and Chief Executive Haijun Wang said in the results statement that “both our hotel and retail businesses sustained strong momentum.” On the earnings call that evening, management raised its forecast for full-year retail revenue growth to between 50% and 55% from about 40%, and said the newest version of its best-selling pillow took in more than 100 million yuan in its first 17 days on sale, the Jiemian columns said.

RevPAR slips at hotels open more than 18 months

The headline hotel numbers held up. Revenue per available room, or RevPAR, was 373 yuan across all hotels, against 371 yuan a year earlier. The average daily rate rose to 453 yuan from 447 yuan and occupancy eased to 79.7% from 80.2%.

Those averages are flattered by new and more expensive properties. At the 1,538 hotels that have been open for more than 18 months, RevPAR fell 4.2% to 356.6 yuan from 372.2 yuan. Occupancy at those hotels dropped to 79.5% from 81.1% and the average rate fell 2.1% to 433.7 yuan, the company's operating data showed. The third quarter covers the summer holidays, which one Jiemian column described as the peak season for hotel pricing. The column said it was the fourth straight quarter of decline on that measure.

Atour keeps adding rooms regardless. It opened 128 hotels in the quarter and closed 15, ending September with 2,288 hotels and 254,800 rooms, up 17.5% and 16.2% from a year earlier. All but 17 are run under the asset-light manachise model, in which the property owner finds the building and pays for the fit-out and running costs, as one Jiemian column described it.

The pipeline is where caution is visible. Atour had 778 manachised hotels under development at the end of September. That was down from 811 at the end of June, and Wang said on the earnings call that franchisees had become more careful about locations, properties and returns, according to a Jiemian column. The company kept its target of about 480 openings this year, the column said.

Profit, payout and guidance

Net income fell 5.5% to 448 million yuan ($67 million) despite the revenue gain. A Jiemian column attributed the gap mainly to share-based compensation, which rose to 167 million yuan from 13 million yuan a year earlier, the company's accounts showed. Those expenses are not tax deductible in China, Atour said. Income tax expense climbed to 264 million yuan from 201 million yuan. Excluding share-based pay, adjusted net income rose 26.2% to 615 million yuan and adjusted earnings before interest, tax, depreciation and amortization rose 28.8% to 883 million yuan.

Operating cash flow was 604 million yuan in the quarter. Atour held about 2.8 billion yuan in cash, cash equivalents and restricted cash at the end of September, against borrowings of 237 million yuan.

The board declared a second dividend for 2026 of 51 cents per American depositary share, about $69 million in total, bringing this year's payouts to roughly $142 million. Under a policy adopted in August 2024, Atour plans to distribute at least half of the prior year's net income in each of three years.

For the full year, Atour said it expects net revenue to grow 33% to 35%. A Jiemian column said the previous guidance was for growth of 30%.

The dividend will be paid on or around Dec. 9 to holders on record at the close of trading on Nov. 23, U.S. Eastern time.