LeMo Technology (02539.HK), billed as the first listed operator of shared massage chairs, has seen its Hong Kong listing unravel almost as quickly as it began. The stock, which floated on 3 December 2025 at HK$40 a share, plunged to HK$18.84 by market close on 6 February 2026, wiping roughly half off the company’s public valuation and prompting sharp, single-day sell-offs of nearly 40% and 11% on 5–6 February.
The initial public offering raised a modest net HK$182 million. LeMo opened at HK$64.80 on debut and closed that day at HK$54.50, giving it an implied market capitalisation of about HK$3.03 billion at the first close. Investors who bought at the offer price have seen value evaporate as questions about the company’s unit economics, deployment claims and after-sales record have multiplied.
LeMo is best known for its “LeMo Bar” self-service massage kiosks, launched in 2016 and marketed for deployment in shopping centres, cinemas and transport hubs, including airports and high-speed rail stations. Financially, the company reported steady revenue growth from Rmb330m in 2022 to Rmb800m in 2024, while gross margin expansion slowed and reported profits remained modest. For the first eight months of 2025 revenue rose 13.9% year-on-year to Rmb631m, but period profit slipped 5.7% versus the prior year and adjusted net profit metrics showed only incremental gains.
What appears to have broken investor confidence are a string of operational and credibility problems. Safety incidents have been publicised — notably an August 2024 episode in Jiangxi where a user’s hair was caught in a device and required fire-department assistance — and user complaints about refunds, opaque membership terms and slow device repairs have proliferated on consumer platforms. The company’s official mini-program carries a low rating (2.2/5) and aggressive in-app advertising, further denting consumer goodwill.
Compounding reputational damage, an investigative probe by a mainland financial outlet in mid-2025 highlighted anomalies in device ID sequences that cast doubt on LeMo’s stated fleet size. Reporters who inspected multiple outlets found device-number gaps inconsistent with normal production runs and an on-the-ground device count that was far smaller than the theoretical totals implied by the company’s serial-numbering scheme. Those findings undermine one of the key claims underpinning LeMo’s valuation: verifiable scale of deployed machines and the associated recurring-usage and membership economics.
The market reaction underscores two wider themes for hardware-plus-service consumer businesses: the fragility of valuations when core operational claims cannot be independently verified, and the heavy penalty investors impose for safety and after-sales failures. For LeMo, immediate priorities will be to demonstrate transparent, auditable deployment and usage data, to shore up device safety and customer-service processes, and to answer regulators and shareholders about the gaps exposed by media probes. Absent convincing remediation, further share-price pressure and regulatory scrutiny are the most probable near-term outcomes.