According to, the two major hot pot listed companies both lost money in the first half of this year.

On August 14, Haidilao released a profit warning, noting that it expected its operating income in the first half of 2022 would be about $24.8 million (16.7 billion yuan), down no more than 17% year-over-year. 

During the same period, its net loss was approximately $33.1 million to $43.7 million (225 million to 297 million yuan), compared to the previous year’s net profit of approximately $14.2 million (96.5 million yuan).

In response to the decline in revenue, Haidilao explained that it was mainly due to the impact of the resurging pandemic from March to May 2022, when certain restaurants in mainland China ceased operations or suspended dine-in services and reduced customer traffic, and the reduction in the number of restaurants under the “Woodpecker Plan” compared to the same period in 2021.

In response to the loss, it was noted that one-time losses on disposal of long-term assets and impairment losses totaling roughly $33.1 million to $48.2 million (255 million yuan to 327 million yuan) were incurred, and the resurgence of the pandemic in mainland China from March to May 2022. 

These losses were caused by the closure of some of the stores under the “Woodpecker Plan” and the impact of the epidemic in the first half of 2022. The Woodpecker Plan is a raft of measures implemented by Haidilao that involved halting new openings while shuttering 300 restaurants in China. Additionally, even while some restaurants stopped serving customers or temporarily canceled dine-in service, they continued to incur fixed expenditures and payroll costs.

In November 2021, Haidilao started to implement a basic order of organization because of its rapid expansion, when it announced that it would gradually shut down 300 stores where operations did not meet expectations, strengthen internal management and assessment mechanisms, contract business expansion, and further improve the company’s operating conditions, and in fact, in 2021, Haidilao closed 276 stores.

In addition, on August 14 evening, “the first hot pot” Gluttony also issued a profit warning. According to the announcement, in the first half of 2022, Gluttony expects revenue of about $318 million (2.16 billion yuan), down 29.0% year-on-year; net loss is expected to be $40 million to $43 million (270-290 million yuan), compared with the previous year’s loss of $69.8 million (500,000,000 million yuan) expanded by about 474.47%-517.02%.

In response to the widening loss, Gluttony pointed out that most of its restaurants in the first half of this year were still affected by the pandemic and could not fully operate. Of the 116 cities where it was located, 92 were affected by the pandemic, accounting for about 79%, with major first-tier cities, in particular, severely affected by the pandemic, such as Beijing, Shanghai, Shenzhen, and Tianjin.

The performance of not only the end of the first half of this year, but the overall situation of listed restaurants also was not optimistic, announcing the results of listed restaurants, not yet able to achieve revenue net profit double up.

In the first half of this year, Starbucks’ revenue in China fell, Yum China’s revenue and net profit both fell, Quanjude and Xi’an Catering’s loss widened, and Tang Palace China, Tai Hing, and Ajiyaki (China) all turned from profit to loss.

Affected by the pandemic and other factors, during the first half of this year, the national restaurant revenue overall trended downward. According to the data released by the National Bureau of Statistics, in the first half of 2022, the national restaurant revenue was $30.2 billion (204 billion yuan), down 7.7% year-on-year; above-the-line restaurant revenue was $72 billion (487.9 billion yuan), down 7.8% year-on-year.

Sign up to receive our latest news!

By submitting this form, I agree to the terms.