Accounts receivable nearly doubled, net profit plunged by almost 40%. What hidden concerns are revealed in Bear Electric’s first quarter report?

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On the evening of April 29, Bear Electric officially disclosed its first quarter report for 2026.

This company, once the "first stock of creative small appliances" that broke out of the red ocean by virtue of its high-value appearance and long-tail demand, is now facing the growing pains of development. According to the financial report data, during the period the company achieved operating revenue of 1.239 billion yuan, a year-on-year decrease of 6.14%; the net profit attributable to the parent company was 79.57 million yuan, a sharp year-on-year decline of 38.67%.

Beneath the slight decrease in revenue, deep adjustments at the profit end, a surge in accounts receivable, and a decline in operating cash flow together outline the complex landscape of intensified competition in the small appliance track and changes in the macro environment. Through this financial report, one can catch a glimpse of Bear Electric's performance composition, reasons for the decline, and the structural challenges faced by the entire niche sector.

Analyzing Bear Electric's first quarter report, the most intuitive feature is the "scissors gap"—the drop in profits far exceeds the decline in revenue. The concurrently disclosed net profit attributable to the parent company excluding non-recurring gains and losses was 74.25 million yuan, a year-on-year decrease of 40.10%. This shows that the profit margin of the company's main business is being substantially squeezed, and gross profit margin and net profit margin levels are undergoing severe tests.

Even more noteworthy are several key indicators in the balance sheet and cash flow statement.

According to the financial report, as of March 31, 2026, Bear Electric's accounts receivable reached as high as 348 million yuan, an increase of 94.31% over the same period last year; meanwhile, the net cash flow from operating activities in the first quarter was 259 million yuan, down 13.3% year-on-year.

Revenue scale has shrunk, but accounts receivable have nearly doubled. This divergence in financial logic usually points to two possibilities: first, in order to maintain sales scale, the company may have relaxed credit policies for downstream distributors or channel vendors; second, that some channels are facing pressure at the terminal, passively prolonging the return payment period.

Whichever the case, it confirms there exists certain destocking or sell-through pressure at the terminal chain, and the company's capital turnover efficiency is being restricted by the external environment. The only slight comfort is that the company's asset-liability ratio fell to 45.47%, decreasing by 8.05% year-on-year, with overall financial leverage still controllable.

Combining the company's disclosures and macro fundamentals, Bear Electric's first-quarter performance slowdown was not caused by a single factor, but was the result of multiple internal and external resonances.

First are the dual changes in policy and market.

This year in the first quarter, the small appliance category exited the scope of “national subsidy”, and this policy gap directly weakened the stimulus on terminal consumption. Coupled with the uncertainty faced by global economic recovery, consumers are more cautious about spending on creative small appliances that are not rigid demands, and overall market demand lacks adequate growth momentum.

Second, the cost end is under pressure.

Geopolitical conflicts leading to fluctuations in global commodity prices have also directly affected manufacturing. The rise in crude oil prices has pushed up the prices of main raw materials such as plastics, while energy and logistics costs have also soared. The small appliance industry is highly sensitive to costs, and price hikes upstream have further eroded the factory gross margins of enterprises.

In addition, exchange rate fluctuations of the RMB against the US dollar during the reporting period triggered exchange losses, causing the company's financial expenses to increase compared with the same period last year.

On endogenous factors, external mergers and acquisitions also failed to bring positive incremental results in the current period. According to the announcement, Bear Electric's holding subsidiary Guangdong Roman Smart Technology Co., Ltd. saw its first quarter operating income decline year-on-year, and its gross profit margin also narrowed from the same period, which directly dragged down the overall consolidated profit of the parent company.

The fluctuation in Bear Electric’s performance is actually a microcosm of the current Chinese small appliance industry.

In the past few years, Bear Electric avoided head-on confrontation with traditional major white goods and kitchen appliance giants such as Midea, Joyoung, and Supor by relying on differentiated long-tail category positioning, attractive industrial design, and the traffic dividend of social e-commerce. However, with relatively low technical barriers in the small appliance industry, in the current stock competition era, this moat is being tested.

On one hand, when the initial dividend of high-value design has been exhausted, traditional giants have rushed into the small appliance track, using deep supply chain advantages and scale effects to launch dimension-reducing attacks; on the other hand, online traffic has shifted from the early search and picture-text era to fragmented, high-cost modes such as live broadcasting and short videos, and customer acquisition costs for brands have soared exponentially.

If relying on high-frequency marketing investment to drive sales continues, marginal utility will greatly diminish, making it easy to fall into the quagmire of increasing revenue without increasing profit.

Further, due to the low threshold for innovation, the life cycle of a blockbuster product on the market is being greatly shortened, and it is easily copied and quickly followed by peers. Without underlying hardcore technological support, it is difficult to sustain brand premium, and it ultimately tends to evolve into intense price wars.

Overall, the fallback in Bear Electric’s 2026 Q1 results is an inevitable result of the combined effects of the macro consumption environment, cost cycle, and changes in industry competition pattern. The surge in accounts receivable and decline in net profit objectively put forward new requirements for management's business strategy.

For companies, the wild growth stage driven purely by subcategory expansion and marketing has come to an end.

Facing a complex and ever-changing cycle, how to reduce inefficient expenses while strengthening the core supply chain and technological R&D, how to properly digest the risk posed by high accounts receivable, and how to find true incremental business opportunities in the stock market will be key to whether it can ride through the cycle.

Risk Warning and DisclaimerThe market has risks and investment requires caution. This article does not constitute personal investment advice, nor does it take into account the special investment objectives, financial situation, or needs of individual users. Users should consider whether any opinions, views, or conclusions in this article are suitable for their particular situation. Investment according to this article is at your own risk. ```