American Brands in China: Win Some, Lose Some

China Readthroughs from Q1 U.S. Earnings

This is a quarterly exercise of analyzing the China business of U.S. and multi-national companies through earnings, for the sake of:

• Understanding their China strategies and growth prospects;

• Doing crosschecks and trying to get a more accurate picture of the Chinese economy;

• Knowing the local market and the competitive landscape of various industries like autos, smartphones and semiconductors…

Since 2018, there is an additional angle of the U.S.-China relations, which has a major impact on both Chinese and U.S. companies operating in China.

Here is where the Alpha opportunities lies. Most U.S. analysts take a U.S.-centric view, while the Chinese analysts take a China-centric view. Hardly anyone is taking information from both sides and trying to sort things out. Hopefully we can fill this gap for investors.

“For the remainder of the fiscal year, we will continue to face uncertainties [in China] such as changes in customer behaviors and the pace of international travel recovery as COVID in China enters a new endemic phase… While we don't expect a straight-line recovery [in China], we are confident in our long-term opportunity.” Starbucks, Q2 earnings call, 05/02/2023