Xiaohongshu prepares Hong Kong IPO at $70 billion valuation

Xiaohongshu, the Chinese social platform known as RedNote, is preparing a Hong Kong IPO that could value the company at more than $70 billion, people familiar with the matter told Reuters.

Chinese social media and e-commerce platform RedNote, known domestically as Xiaohongshu, is preparing for a landmark public listing in Hong Kong that could value the company at more than $70 billion.

People familiar with the matter told Reuters that the Shanghai-based company has appointed Goldman Sachs and China International Capital Corporation (CICC) to advise on the offering, which could take place in the second half of 2026, subject to regulatory approvals.

While the company has not publicly confirmed the timeline, market participants view the listing as a defining moment for both Hong Kong’s resurgent capital markets and China’s broader technology ecosystem.

Goldman Sachs and CICC join listing preparations

The proposed Xiaohongshu Hong Kong IPO arrives as global investors increasingly return to Chinese technology stocks following signs that Beijing is adopting a more supportive stance toward the private sector.

According to Reuters, the company is targeting a valuation exceeding $70 billion, significantly above the roughly $50 billion implied by private secondary share transactions completed in late 2025.

The rebound marks a remarkable recovery for Xiaohongshu, whose valuation reportedly fell to around $17 billion in 2024 amid concerns about China’s slowing economy, tighter regulation and weak sentiment toward consumer technology firms.

Founded in 2013 by Mao Wenchao and Qu Fang, Xiaohongshu initially focused on helping Chinese consumers discover overseas products and shopping recommendations. Over time, it evolved into a lifestyle-focused platform blending social media, content creation and e-commerce.

Often compared with Instagram because of its image-driven content and creator ecosystem, the platform now attracts more than 400 million monthly active users who share recommendations spanning fashion, beauty, travel, food and wellness.

The app also gained unexpected international traction in early 2025 when some U.S. users migrated to RedNote amid uncertainty surrounding TikTok’s future in the United States.

Strong earnings momentum drives investor confidence

Robust profitability has become a major factor behind investor enthusiasm for the Xiaohongshu Hong Kong IPO.

Reports indicate the company generated more than $2 billion in net income last year and could exceed $3 billion in profit during 2026.

That performance represents rapid growth from 2023, when Xiaohongshu recorded its first annual profit of approximately $500 million on revenue of $3.7 billion.

The platform’s ability to convert user engagement into advertising and e-commerce revenue has helped distinguish it from many consumer internet peers that continue to prioritize growth over profitability.

“The market is rewarding platforms that can demonstrate sustainable monetization and resilient user growth,” said independent technology analyst Rui Ma, founder of Tech Buzz China, in previous commentary on China’s internet sector.

Investors are also betting that Xiaohongshu’s combination of content discovery and shopping integration positions it well to capture a larger share of China’s digital advertising market.

However, competition remains fierce.

ByteDance-owned Douyin continues to dominate short-form video and social commerce, while Alibaba, Tencent and other established players are investing heavily in creator ecosystems and retail media.

A defining test for Hong Kong’s IPO recovery

The Xiaohongshu Hong Kong IPO comes at a pivotal time for Hong Kong’s equity markets.

Hong Kong Financial Secretary Paul Chan recently said IPO fundraising in the city had surpassed HK$140 billion in 2026, helping Hong Kong reclaim its position as one of the world’s leading listing destinations.

The city recorded a sharp increase in deal activity throughout 2025, with momentum carrying into this year as mainland Chinese companies increasingly choose Hong Kong over New York for public offerings.

Geopolitical tensions, data security concerns and tighter scrutiny of overseas listings have accelerated that shift.

Xiaohongshu previously explored a U.S. IPO in 2021 but shelved those plans after Chinese regulators intensified oversight of offshore listings involving domestic technology firms.

Before moving forward, the Xiaohongshu Hong Kong IPO must secure approval from the China Securities Regulatory Commission, a process that could take several months.

If completed successfully, the offering could become a benchmark for how international investors value Chinese consumer technology companies in a changing regulatory environment.

Regulatory risks and global expansion challenges remain

Despite its strong growth trajectory, the Xiaohongshu Hong Kong IPO still faces meaningful risks.

Competition for advertising spending in China remains intense, while stricter rules governing data privacy, content moderation and cross-border expansion could create operational challenges.

The company must also navigate geopolitical uncertainty as it seeks to expand beyond mainland China and capitalize on growing international recognition.

Nevertheless, analysts believe a successful listing would provide Xiaohongshu with fresh capital to invest in artificial intelligence, creator tools, e-commerce infrastructure and overseas growth initiatives.

For Hong Kong, the deal would reinforce the city’s status as the preferred destination for Chinese technology which include cypto,  companies seeking global capital.

For investors, the Xiaohongshu Hong Kong IPO could offer a rare opportunity to gain exposure to one of China’s fastest-growing and most profitable consumer internet platforms as it enters the public markets.