Once China’s “national” drink, Six Walnuts now can’t sell — and its maker is scrambling for answers

Collapse of a once‑dominant brand

Yangyuan Beverage (养元饮品), the company behind Six Walnuts (六个核桃), has seen its flagship product’s halo fade fast. The 2025 annual results show revenue of 53.36亿元 and net profit to owners of 12.60亿元, declines of 11.9% and 26.8% respectively. Six Walnuts — still more than 80% of group sales — brought in 44.30亿元 but slid 17.6% year‑on‑year; volume fell from 85.68万吨 in 2018 to 47.85万吨 in 2025, a drop of 44.2%. How does a market leader end up with nearly 70% of its plant‑milk capacity idle? The answer is partly in those numbers: the group has 36 production lines with annual capacity of about 152万吨, yet produced only 47.01万吨 in 2025 (capacity utilization ~30.9%).

Marketing, controversy and a dividend culture

Part of the decline tracks back to long‑running marketing. The brand’s “frequent brain use? drink Six Walnuts” positioning captured students and office workers and helped drive peak sales. But the “brain‑boosting” association has long faced scientific and regulatory skepticism. Yangyuan has publicly denied ever claiming clinical brain‑enhancing effects, yet consumer doubt has persisted and reportedly dented repeat purchase. At the same time, the company has maintained a very high dividend payout; it has been reported that controlling shareholder Yao Kuizhang (姚奎章) has emerged as a major beneficiary. That heavy focus on shareholder returns, critics say, starved R&D, product iteration and channel investment — accelerating the decline.

From drinks to chips: a risky pivot that moved the stock

With the core business sagging, Yangyuan’s strategy shifted toward cross‑industry investments. In April 2025 the company’s wholly owned unit invested 16亿元 for roughly 0.99% of Changjiang Memory (长江存储), a domestically strategic storage‑chip firm; it has been reported that this made Yangyuan one of the largest private shareholders. The bet paid a short‑term market dividend: after Changjiang Memory moved toward IPO prep in May 2026 Yangyuan’s shares almost doubled in a month, peaking at 53.00元. Yet this is a politically charged space. Changjiang Memory sits at the heart of China’s push for semiconductor self‑sufficiency and is affected by Western export controls and trade policy, so valuation is as much geopolitical as commercial.

Deep losses elsewhere and the question ahead

The chip stake is an outlier amid years of costly cross‑sector gambles. Past investments in areas from real‑estate restructuring to lithium batteries and media have largely underperformed — Zhongji investment (中冀投资) and a lithium battery holdout reportedly produced substantial losses and impairments, dragging investment income negative in 2023–24. The result is a bifurcated company: a shrinking consumer franchise and volatile capital‑market exposures. For Western readers unfamiliar with China’s corporate landscape, Yangyuan’s story is a cautionary tale about brand fatigue, aggressive payouts and the political allure of strategic tech assets — and it raises a basic question: can a namesake national drink be revived by financial engineering, or does revival need old‑fashioned product fixes and channel reinvestment?