Key Takeaways:
ZTO Express (NYSE: ZTO) reported first-quarter revenue of 13.28 billion yuan ($1.93 billion), a 22% increase from the prior year, as parcel volumes continued to show robust growth.
"During the first quarter of 2026, ZTO maintained focus on quality of services and customer satisfaction, and well executed our key strategies to improve operating cost efficiencies and strengthening network pricing policy fairness and transparency," Meisong Lai, Founder, Chairman and CEO, said in a statement.
The express delivery company's parcel volume for the quarter ended March 31 reached 9.7 billion, a 13.2% year-over-year increase. Adjusted net income grew 5.2% to 2.38 billion yuan, while net income rose 5.7% to 2.16 billion yuan. The company did not provide consensus estimate comparisons.
ZTO maintained its full-year parcel volume growth guidance of 10% to 13%, suggesting confidence in sustained demand. The company also announced a new $1.5 billion share repurchase program, effective through March 2028.
The growth in revenue was supported by an 8.2% increase in the core express delivery unit price, which the company attributed to a favorable shift in mix toward key accounts, including reverse logistics.
"Our volume growth against industry deceleration came from the consistency of anti-involution policy as well as our initiatives to drive reasonable profit allocation for everyone under the ZTO brand," CFO Huiping Yan said.
Unit transportation cost decreased by 9.8%, or 4 cents, which the company attributed to economies of scale and improved routing efficiency. Sorting hub operating costs increased by 6.0% due to higher labor-associated costs and depreciation.
The results indicate a focus on quality growth within China's express delivery industry, which is benefiting from policies aimed at reducing excessive competition. ZTO's performance suggests its strategy of balancing volume growth with profitability is proving effective. Investors will watch the company's ability to maintain pricing power and cost controls in the upcoming quarters.
This article is for informational purposes only and does not constitute investment advice.
