Key Points
- Huabao’s H1 2026 revenue rose 20.31% to CNY 729.11 million, while overseas revenue jumped 216.08% to CNY 96.02 million.
- Overseas sales contributed approximately 53% of the company’s total year-on-year revenue increase and rose from about 5% to 13.2% of total revenue.
- Non-flavor businesses reached 42.2% of revenue; nutrition and health sales increased 64.13%, while fragrance and personal care rose 35.97%.
- Huabao identified core ingredients for heated tobacco products and nicotine pouches as a strategic growth area and said it had entered the supply chains of leading global tobacco customers.
- Reported net profit increased 720.09%, but adjusted net profit rose only 2.78% and operating cash flow fell 48.61%.
- The company did not disclose its next-generation tobacco customers, supply stages, related revenue or profit contributions.
2Firsts
August 28, 2026 Shenzhen
According to Huabao Technology Co., Ltd.’s H1 2026 report released on Aug. 27, the company, long positioned at the center of China’s traditional tobacco supply chain, is expanding its business across global food, nutrition, health and next-generation tobacco ingredient markets.
The report indicates that Huabao’s transformation is moving from strategy into visible results. Overseas revenue increased 216.08% in the first half of 2026, non-flavor businesses reached 42.2% of total revenue, and the company said it had entered the supply chains of leading global tobacco customers. Revenue from nutrition and health rose 64.13%, while fragrance and personal care increased 35.97%, both outpacing the established flavor division.
Together, the figures show Huabao redefining its corporate identity across several connected dimensions: expanding beyond China into global markets, extending its traditional tobacco capabilities into heated tobacco and nicotine pouches, and broadening its revenue base across food, nutrition, health, fragrance, personal care and next-generation tobacco.
The company formally changed its Chinese corporate name to Huabao Technology Co., Ltd. in June 2026. More than the name itself, the overseas revenue, customer, production and divisional data in the latest report provide a clearer picture of the transformation’s progress.
Overseas Revenue Jumps 216% and Delivers About 53% of Growth
Huabao reported H1 2026 revenue of CNY 729.11 million, up 20.31% year on year. Overseas revenue increased from CNY 30.38 million to CNY 96.02 million, a rise of 216.08%, while its share of total revenue increased from approximately 5% to 13.2%.
Based on the disclosed figures, overseas revenue increased by around CNY 65.64 million and contributed approximately 53% of Huabao’s total year-on-year revenue increase. Excluding overseas sales, domestic revenue was approximately CNY 633.10 million, up about 10%.
Although the 216% increase partly reflects a low comparative base, international markets have become a major source of Huabao’s growth. More importantly, the internationalization effort is extending beyond exports into local research, regional production, regulatory compliance and cross-border supply.
In Southeast Asia, Huabao coordinates regional operations through its Singapore-based Asia-Pacific unit, supported by an Indonesian base and local research capabilities. The company said it serves brands including TOMORO COFFEE and Chagee in the region.
Huabao’s integrated food technology base in Indonesia is scheduled for completion in the second half of 2026. The company plans to use Singapore as a regional coordinating hub and Indonesia as a production and supply base serving Southeast Asia, the Middle East and Africa.
In Europe, Huabao said its food ingredients continued to grow through restaurant chains, while its nutrition, flavor, fragrance and personal-care businesses entered international customer supply chains. Sales of encapsulated flavors and new beverage products also increased across Europe, Southeast Asia and the Middle East.
Huabao’s nutrition and health business secured orders in Australia and New Zealand, which the company views as important production centers and premium markets for nutritional and health products.
The regional developments point to an increasingly connected overseas footprint: Southeast Asia for local research and production, Europe for food ingredients, fragrances and access to international customers, and Australia and New Zealand for nutrition and health expansion.
Overseas sales still accounted for only 13.2% of total revenue, however, and the Indonesian facility has yet to enter full operation. Huabao’s internationalization is generating visible revenue, but it remains some distance from a mature global operating system.
From Tobacco Flavors to Core Ingredients for Heated Tobacco and Nicotine Pouches
Huabao’s transformation does not mean it is leaving tobacco. Instead, the company is transferring technology, customer relationships, quality management and compliance capabilities built in the traditional tobacco supply chain into global next-generation tobacco markets.
The interim report placed “core ingredients for heated tobacco products and nicotine pouches” alongside nutrition, health, fragrance and personal care as priority areas under Huabao’s 2026 strategic upgrade.
Huabao said it continued to increase research into heated tobacco and nicotine pouches and had entered the supply chains of “leading global tobacco customers.” It added that its technical and compliance capabilities had been recognized by international clients. The company is also expanding its global patent portfolio and deepening strategic cooperation with international tobacco groups.
The use of “core ingredients,” rather than only “tobacco flavors,” suggests a potentially broader role in next-generation tobacco.
Heated tobacco products create requirements involving flavor release under heating, thermal stability, material compatibility and formulation consistency. Nicotine pouches involve nicotine release, oral sensory experience, flavor duration, ingredient stability and compliance across different markets. Suppliers may therefore need to provide capabilities ranging from core ingredients and formulation design to application testing and regulatory support.
Huabao has 30 years of experience in flavor science. Flavor remains its largest division, covering food flavors, tobacco flavors and compound flavor ingredients. The company has also developed digital spectral databases for natural and synthetic aroma materials, along with proprietary models for chromatographic peak analysis, natural aroma identification and AI-assisted flavor formulation.
Those capabilities provide a technical foundation for Huabao to move from traditional tobacco flavors toward core ingredients and application solutions for next-generation tobacco products.
However, the report did not identify Huabao’s global tobacco customers or specify whether the relationships involve technical qualification, product testing, limited initial supply or commercial-scale orders. Revenue, growth and profit contributions from heated tobacco and nicotine pouches were also not separately disclosed.
The filing therefore indicates that Huabao has secured access to global tobacco customer supply chains, but it does not yet show that next-generation tobacco has become a material revenue pillar.
Non-Flavor Businesses Reach 42.2% as Food and Nutrition Drive Scale
Alongside the shift in tobacco, Huabao is reducing its concentration in traditional flavors and tobacco-related businesses.
Non-flavor businesses accounted for 42.2% of revenue in H1 2026. Nutrition and health revenue rose 64.13%, fragrance and personal-care revenue increased 35.97%, and flavor revenue grew 6.68%.
Flavor remains Huabao’s largest division and what the company describes as the “ballast” supporting its strategic upgrade. Its food flavor, tobacco flavor and compound flavor operations serve international consumer companies and emerging Chinese brands including Mondelēz International, Orion, Nestlé, Dayao, Ningji, Molly Tea and Chagee.
Huabao applies natural flavors in sparkling water, juice and beer. Its compound flavor business serves industrial catering, snack food and new-style tea beverages, with products ranging from salami, white truffle steak and black garlic beef flavors to standardized sauces for braised dishes, Kung Pao recipes and Sichuan pepper applications.
Huabao describes nutrition and health as its potential second growth pillar after flavor. Customers include Yum, Yili, New Hope, Baxi and WARMSANTA.
The division is expanding customized nutrient formats, food fortification ingredients, functional fruit powders, plant extracts, jams, juices, popping boba and dried fruit products for functional food, sports nutrition, beauty supplements, dairy, beverages, tea chains and restaurant customers.
Huabao’s Phase I Shandong Jiacui project entered production during the period, construction began on its Jiangxi Jiacui health industry base, and its Guangdong Jiacui facility received a production license. The company is also commercializing technologies including liposomes, nanocrystals, microencapsulation and nanoemulsification.
In fragrance and personal care, Huabao operates through its Xiamen Amber business, covering personal care, aroma-based wellness, pet care and functional or mood-related fragrances, with selective expansion into original design manufacturing. The company said it maintained stable supply relationships with international customers in Europe and was advancing construction of a new daily-use fragrance factory in Xiamen.
The customer, product and capacity disclosures show that Huabao’s diversification has moved beyond simply searching for businesses outside tobacco. It is building a portfolio spanning food flavors, nutrition, health, fragrance, personal care and next-generation tobacco ingredients.
Food and nutrition provide a broader market and customer base. Next-generation tobacco builds on Huabao’s established technology and industry relationships, while fragrance and personal care extend flavor science into additional consumer applications.
Revenue Rises 20%, but Adjusted Profit Gains Only 2.78%
Huabao’s scale and revenue mix are changing, but its earnings and cash flow show that investment and returns have yet to align fully.
Revenue rose 20.31% to CNY 729.11 million, while net profit attributable to shareholders increased 720.09% to CNY 110.05 million. Basic earnings per share rose from CNY 0.02 to CNY 0.18.
Net profit excluding non-recurring items, however, was CNY 48.54 million, up only 2.78%. The difference between reported and adjusted net profit was approximately CNY 61.51 million, equivalent to about 55.9% of reported net profit.
Huabao said that lower share-based payment expenses and fair-value changes in financial assets, in addition to higher revenue, increased reported net profit. The 720.09% headline gain therefore does not represent an equivalent improvement in underlying operating profitability.
Huabao’s adjusted net margin was approximately 6.7%, down from about 7.8% a year earlier. New businesses are generating revenue, but their cost structure and profit conversion remain under pressure.
Some capacity in the nutrition and health division was still starting up or ramping during the period, while certain products were temporarily made through outsourced manufacturers. Huabao said this increased costs and pressured profitability. It expects more in-house production and economies of scale to improve earnings as facilities including Shandong Jiacui increase output.
Operating cash flow also warrants attention. Net cash generated from operating activities fell 48.61% to CNY 41.11 million, moving in the opposite direction from revenue. The report summary did not provide a detailed explanation, leaving receivables, inventories, outsourced production, new capacity and overseas expansion as areas for further review.
Huabao had total assets of CNY 7.28 billion at the end of June, down 0.85% from the end of 2025. Equity attributable to shareholders stood at CNY 6.82 billion, up 0.47%. Weighted average return on equity was 1.61%, indicating a substantial asset base but still limited capital returns.
2Firsts Observation
Huabao’s H1 2026 report does not describe a traditional tobacco supplier making a sudden bet on new businesses. It shows the emerging, measurable results of a broader restructuring of the company’s identity and business model.
The 216.08% increase in overseas revenue shows that international markets are becoming a new source of growth. The 42.2% contribution from non-flavor businesses indicates that food, nutrition, health and other operations are materially changing the revenue mix. Entry into leading global tobacco customer supply chains shows Huabao transferring its traditional tobacco capabilities into heated tobacco and nicotine pouches.
These developments are interconnected.
Overseas regulatory, research, production and delivery capabilities support Huabao’s entry into global food and tobacco customer supply chains. Its traditional tobacco experience provides technical, quality and customer-access advantages in next-generation tobacco ingredients. Growth in food and nutrition reduces reliance on a single industry and expands its addressable market.
At this stage, however, the scale effect is more visible than the profit effect. Overseas revenue and non-flavor businesses grew rapidly, but adjusted net profit increased only 2.78%, operating cash flow fell 48.61%, and next-generation tobacco revenue was not separately quantified.
The next phase will depend on more specific outcomes: whether global tobacco customer relationships move into commercial-scale supply; whether Huabao begins reporting heated tobacco and nicotine pouch revenue separately; whether the Indonesian base secures international orders; whether new nutrition capacity improves margins; and whether overseas and diversified revenue can ultimately produce stronger profit and cash flow.
Huabao is moving from a leading position in China’s traditional tobacco supply chain toward a global technology platform serving food and next-generation tobacco ingredient markets. Its H1 2026 results show that the transformation is already changing its revenue sources, customers and production footprint, but its ultimate commercial value will depend on sustained earnings and cash generation.
Follow 2Firsts for continued coverage and analysis of Huabao’s transformation, heated tobacco and nicotine pouch ingredients, global tobacco supply chains, and the international expansion of Chinese suppliers.
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