Shares of MINISO Group Holding Limited (NYSE: MNSO) fell 5.68% in pre-market trading on Friday, despite the company reporting solid financial results for the fourth quarter and full year of 2024.

The global value retailer announced that its revenue for the full year 2024 increased 22.8% year-over-year to RMB16,994.0 million (US$2,328.2 million). Gross profit rose 34.0% to RMB7,637.1 million (US$1,046.3 million), with gross margin reaching a record high of 44.9%, up from 41.2% in 2023. Adjusted net profit grew 15.4% to RMB2,720.6 million (US$372.7 million).

Despite these positive results, investors appear to be focusing on a few potential concerns:

1. Revenue miss: For the fourth quarter, MINISO reported sales of RMB4.71 billion, which missed analyst estimates of RMB4.86 billion by 3.13%.

2. Margin pressure: While gross margin improved, the company's adjusted net margin declined slightly to 16.0% in 2024 from 17.0% in 2023. This could be due to increased operating expenses, particularly in selling and distribution, which rose 54.3% year-over-year.

3. Slowing growth in mainland China: Revenue growth from MINISO brand in mainland China was 10.9% for the full year, which, while still strong, represents a deceleration from the 36.2% growth seen in 2023.

Despite the pre-market decline, MINISO's long-term growth story remains intact, with the company achieving the milestone of 3,000 overseas stores and adding a record 1,200 net new stores globally in 2024. The company also returned RMB1,574.5 million to shareholders through dividends and share repurchases in 2024.