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The medical aesthetic mask business may be approaching structural changes.
In 2025, Fuerjia, known as the &#34;first stock of medical aesthetic masks,&#34; reported operating revenue of 1.893 billion yuan, a year-on-year decline of 6.14%; net profit attributable to shareholders was 433 million yuan, a significant year-on-year drop of 34.56%; and non-recurring net profit attributable to shareholders nearly halved, falling from 604 million yuan in the same period last year to 337 million yuan, a year-on-year decline of 44.13%.
The Q1 2026 financial report released on the same day showed a dramatic shift. Under the effects of lagging expense realization and base-effect recovery, its revenue reached 548 million yuan, up 82.12% year-on-year; net profit attributable to shareholders was 172 million yuan, up 87.73% year-on-year.
Amid this sharp decline followed by a surge, the professional skin care enterprise that started with &#34;medical device number&#34; products is undergoing a profound channel transformation and business reshaping.
<h2>01 Channel Pain, Surge in Expenses</h2>
The performance slump in 2025 was not caused by a single factor but by the accumulation of multiple pressures.
First was the channel adjustment. The company's annual report explicitly stated that the decline in operating revenue was mainly due to &#34;optimizing offline channels.&#34; In 2025, online revenue grew 33.5% year-on-year, while offline revenue plummeted 54.5% year-on-year. The proportion of online revenue surged from about 55% last year to 78.2%, representing a year-on-year increase of 23.2 percentage points. The sharp contraction in offline business directly dragged down overall revenue.
On the other hand, while revenue declined, the drop in profits far exceeded the revenue decline, reflecting immense pressure on expenses. In 2025, the full-year sales expense ratio rose by 11.2 percentage points year-on-year, and the period expense ratio rose by 15.5 percentage points to 54.3%. The company explained in its semi-annual report that the decline in net profit was &#34;mainly due to continued increases in promotion and advertising expenses.&#34;
In fact, this trend had already emerged in 2024. The full-year sales expense ratio for 2024 reached 37.1%, an increase of 9.6 percentage points compared to the previous year. At that time, the company's online direct sales revenue grew by a high 26.8% year-on-year, but marketing costs rose accordingly.
Entering 2025, as the proportion of online channels expanded further, expense pressures also intensified, leading to a simultaneous contraction in the company's operating cash flow.
In 2025, the company's net cash flow from operating activities was 367 million yuan, a year-on-year decrease of 39.9%. Regarding inventory, inventory at the end of 2025 increased by 3.5% year-on-year to 170 million yuan, and the inventory turnover days extended from about 139 days last year to 156 days. However, the company's debt ratio remained at a low level of 4.09%, and the balance sheet remained generally healthy.
Of particular note is that the company is currently in a phase of product transition.
Fuerjia started with medical device-number medical dressings, and products like &#34;Fuerjia White Mask&#34; and &#34;Black Mask&#34; were once the company's most recognizable star items. However, looking at the product structure from 2025, this landscape is undergoing significant changes.
In 2025, the company's cosmetics business revenue grew 16.3% year-on-year, with its revenue share rising to 71.6%; meanwhile, medical device business revenue fell sharply by 36.8% year-on-year, dropping its share to 28.5%. This means functional skincare has replaced medical dressings to become the company's largest revenue pillar.
This change is both the result of proactive transformation and reflects the pressure faced by the medical dressing sector.
On one hand, as the National Medical Products Administration continues to refine classification management of &#34;medical dressings,&#34; the compliance threshold for medical device-number products continues to rise; on the other hand, more and more cosmetic brands are entering the professional skin care sector, competing for market share with lower prices and richer marketing tactics.
<h2>02 Fierce Competition in a Trillion-Yuan Red Ocean</h2>
The changes in Fuerjia's financial data are not isolated events but are embedded in the industry shifts within the two intersecting tracks of functional skincare and medical dressings. To understand Fuerjia's situation, it must be examined through three dimensions: industry scale, competitive landscape, and regulatory environment.
Functional skincare and medical dressings both belong to the professional skin care track, with the market size continuing to expand.
According to statistics from Qianzhan Industry Research Institute, looking at the broader professional skin care product market, the industry is expected to grow at a compound annual growth rate of 13.9%, potentially breaking through 100 billion yuan by 2030.
However, industry competition is becoming increasingly fierce.
From the perspective of the competitive landscape in the functional skincare sub-sector, Botanee holds the top position with its Winona brand, accounting for 11.71% of the market share; Huaxi Bio follows closely with 5.27%; Fuerjia, Shanghai Jahwa, and Giant Biogene account for 4.14%, 2.44%, and 2.15% respectively.
Overall, the market concentration of domestic functional skincare brands remains low, with the top three companies' revenue concentration at 21.12%, while market share is scattered among international big brands.
In the competitive tiers, Botanee stands in the first tier with functional skincare revenue exceeding 5 billion yuan; Giant Biogene, Fuerjia, Shanghai Jahwa, and others are in the second tier, with business income ranging between 1 billion and 3 billion yuan.
The &#34;low-price spiral&#34; facing the mask category is a common industry issue.
Basic patch mask formulations have low thresholds, severe homogenization exists, and e-commerce promotions and live-streaming sales have further intensified price competition, squeezing brand premium space.
For Fuerjia, whose core category is patch masks, how to break through the low-price dilemma through raw material differentiation and scenario deepening is a proposition that must be answered in industry competition.
Changes in regulatory policies are also key variables in understanding the evolution of the medical dressing industry landscape.
Medical dressings managed under medical device regulations are classified into Class I, Class II, and Class III medical devices according to risk levels from low to high; any claiming sterility must be managed at least as Class II medical devices; if contacting deep dermal or deeper tissue wounds, management requirements are even stricter.
The raising of compliance thresholds has a dual effect on the industry: on one hand, leading enterprises possessing complete registration certificates and compliance systems enjoy a first-mover advantage, significantly raising the entry barrier for new entrants;
on the other hand, after &#34;medical device-number masks&#34; were explicitly prohibited in cosmetic promotional contexts, enterprises must strictly distinguish between medical device-number medical dressings and cosmetic-number cosmetics, and can no longer blur the boundaries between the two in their promotional messaging.
Combining industry data and competitive trends, the functional skincare and medical dressing sectors are undergoing a transition from &#34;competing on marketing&#34; to &#34;competing on R&amp;D.&#34; Leading players have gradually established brand barriers and R&amp;D barriers, because the R&amp;D and declaration cycle for special cosmetics is relatively long, and there is strong dependence on imported raw material suppliers in terms of ingredients, giving upstream suppliers significant leverage regarding special efficacy ingredients.
This trend poses a dual challenge for Fuerjia: on the cosmetics side, it needs to build a component moat through new raw material R&amp;D; on the medical device side, it needs to advance Class III device registration to elevate the category height.
For Fuerjia, the focus of industry competition has shifted from early conceptual positioning to technical positioning.
How it completes the transition from channel-driven to technology-driven in this paradigm shift will determine whether it can maintain and enhance its market position in the trillion-yuan track.

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