Tims China’s registered loyalty-club membership increased 41.7% year over year to 37.1 million members at June 30, 2026, giving the Tim Hortons China operator a substantially larger addressable customer base even as Q2 sales and transaction volumes declined.
The membership increase contrasts sharply with current operating trends. Total Q2 revenue declined 21.7% to RMB273.4 million, or approximately $40.3 million, while system sales fell 15.1% to RMB347.8 million.
Company-owned same-store sales declined 17.3%, while system-wide same-store sales fell 17.8%. The number of company-owned store orders declined 20.7% to 8.3 million from 10.5 million, and average ticket decreased 0.9%.
Tims China is responding by reshaping its store network. The company ended Q2 with 1,028 stores, consisting of 544 company-operated locations and 484 franchised stores. Franchised locations increased from 449 a year earlier, while company-operated stores declined from 566.
The composition of that network is changing even more significantly. Made-to-order stores increased to 780 from 692, while non-MTO locations declined to 248 from 323. During Q2 alone, the company had a net opening of 15 MTO stores and a net closure of 13 non-MTO stores, producing two net new locations overall.
Store-level profitability was pressured by the sales decline. Company-owned store contribution fell to RMB12.6 million from RMB27.2 million, while contribution margin declined to 5.7% from 9.6%. On a GAAP basis, fully burdened company-owned gross profit was a RMB7.2 million loss compared with a RMB400,000 profit a year earlier.
Net loss widened to RMB97.4 million, or approximately $14.4 million, from RMB75.9 million. Adjusted net loss increased to RMB54.9 million from RMB39.7 million. Tims China ended June with RMB121.1 million, or approximately $17.8 million, of cash, cash equivalents and restricted cash.
Despite the operating losses, Q2 operating cash flow improved to RMB34 million from negative RMB1.2 million a year earlier. After quarter-end, Tim Hortons Restaurants International, the company’s brand owner and founding shareholder, provided an initial $15.8 million tranche of additional senior secured convertible-note financing.
The rapidly expanding loyalty base gives management a large pool of customers to re-engage as it changes the store portfolio and product strategy. Tims China has also begun broadening the membership ecosystem, including an August joint membership initiative with China Southern Airlines.
KEY QUOTE:
“The second quarter was a period of transition for Tims China. Our top-line results were impacted by our proactive decision to close underperforming stores, as well as pressure on same-store sales as we lapped strong delivery performance from last year. It is clear that we need to make meaningful changes to our strategy to win back customers. My experience tells me that when we focus on our core identity and consistently deliver great products and a great guest experience, our customers will respond. I have full confidence in Tims China’s ability to improve the business and regain market share. We have a clear plan and are moving quickly to return the business to growth. We already see green shoots in the business when we look at our registered loyalty club membership, which reached more than 37.1 million as of June 30, 2026, up 41.7% year over year, providing a strong foundation to deepen customer engagement and support future growth”.
Kwok Wah (John) Cheung, CEO of Tims China
