Earnings "Double Decline"! Mindray Loses Momentum

The 'tough times' for the medical device industry are still continuing.

In order to 'break through', Mindray Medical has been increasing the revenue proportion of in-vitro diagnostic (IVD) products in recent years, while revenue from life information and support products has declined relatively severely, and revenue from medical imaging products has also seen a certain degree of decline.

Reflected in the capital market, Mindray Medical's performance over the past five years has not been ideal.

Recently, Mindray Medical released its 2025 financial report. The report shows that in 2025, operating revenue reached 33.282 billion yuan, a year-on-year decrease of 9.38%; net profit was 8.136 billion yuan, a year-on-year decrease of 30.28%; non-GAAP net profit was 8.069 billion yuan, a year-on-year decline of 29.48%; and gross margin was 60.32%, a slight year-on-year decline.

It is reported that this is Mindray Medical's first financial report with a 'double decline' in performance since its listing seven years ago.

In contrast, United Imaging Healthcare, another leading domestic high-end imaging equipment company, is in a slightly better situation. According to the company's performance bulletin, United Imaging Healthcare achieved operating revenue of 13.821 billion yuan in 2025, a year-on-year increase of 34.18%; net profit was 1.888 billion yuan, a year-on-year increase of 49.6%.

Therefore, this underperforming financial report from Mindray Medical is due to both industry-wide reasons and Mindray's own factors.

Overall, revenue from in-vitro diagnostic products in 2025 was 12.241 billion yuan, accounting for 36.78% of total revenue; revenue from life information and support products was 9.837 billion yuan, accounting for 29.56% of total revenue; revenue from medical imaging products was 5.717 billion yuan, accounting for 17.18% of total revenue; and revenue from emerging business products was 5.378 billion yuan, accounting for 16.16% of total revenue.

It is worth noting that Mindray's life information and support products declined more severely in 2025, and an even more dangerous signal is the decline in revenue from in-vitro diagnostic products.

In fact, from the perspective of the medical device industry, the fastest way to expand a company's revenue scale is to increase the proportion of IVD products. As is well known, in the domestic market, IVD is one of the sectors with the most intensive policy issuance and the most intense price competition. However, in the process of global layout, IVD is indeed a shortcut. According to Mindray's financial reports, since 2021, the revenue growth rate of Mindray's in-vitro diagnostic products has remained at a relatively high level. By 2024, revenue from in-vitro diagnostic products exceeded that of life information and support products, becoming the company's largest source of income.

If this trend continues smoothly, Mindray Medical could rank among the top ten global medical device companies in the next decade, but market conditions may be more pessimistic than Mindray anticipated.

As early as mid-2025, Mindray's management clearly stated that the sales growth rate in Mindray's domestic market would turn positive in the third quarter of 2025, achieving a rebound. Judging from the single-quarter situation, this expectation was not realized as planned. Revenue in the fourth quarter remained weak, and net profit experienced a cliff-like decline.

The financial report shows that in the fourth quarter of 2025, Mindray Medical achieved revenue of 7.448 billion yuan, a slight year-on-year increase of 2.86%; net profit was 566 million yuan, a year-on-year decline of 45.15%.

Regarding Mindray's predicament, Li Xiting clearly has a clear understanding, so he has focused on international layout.

Mindray's management previously revealed that the target for the proportion of overseas revenue is to reach over 70%.

The financial report shows that in 2025, Mindray's domestic revenue was 15.632 billion yuan, accounting for 46.97% of total revenue; overseas revenue was 17.650 billion yuan, accounting for 53.03% of total revenue. Among them, the European market achieved a further 17% growth in 2025 on the basis of high growth in 2024.

In the view of Mindray Medical, the most difficult moment for the company's domestic market has passed. It is expected that domestic business will resume positive growth in 2026, and profit growth rate is expected to turn positive. The accessible scale of the international market is 4 to 5 times that of the domestic market, and the company's international business growth will lead in the long term.

To demonstrate confidence in the company, in the second half of 2025, Li Xiting, the actual controller and chairman of Mindray Medical, increased his holdings multiple times, spending a total of approximately 200 million yuan to buy company shares. At the same time, senior executives such as the general manager, senior vice president, and financial director of Mindray Medical also made large-scale purchases of company shares for the first time.

In addition, Mindray Medical continues its high dividend policy. According to the company's disclosed 2025 profit distribution plan, the total cumulative cash dividend for 2025 will reach 5.310 billion yuan, with a cash dividend payout ratio of 65.27%.

In terms of R&D investment, Mindray Medical's total R&D investment in 2025 was 3.929 billion yuan, accounting for 11.80% of total operating revenue. Mindray stated that based on the digital-intelligent medical ecosystem, the company continues to advance the integrated 'Device + IT + AI' strategy, promoting the continuous evolution of solutions and product ecosystems. It has gradually transformed from a single medical device product supplier into a service provider that enhances the overall diagnosis and treatment capabilities of medical institutions.

Kan Jian Finance believes that in the short term, as Mindray Medical's revenue growth slows, the market will also have some concerns about the company's growth potential. Under this background, Mindray Medical's valuation will continue to face pressure. In the long term, we are optimistic about the increase in the proportion of Mindray's overseas revenue. If Mindray's overseas revenue proportion reaches 70%, we believe Mindray is highly likely to return to the high-growth track.