Durex condom sales in China have fallen sharply following the removal of a long-standing tax exemption and the introduction of stricter rules on contraceptive marketing, as Beijing intensifies efforts to boost the country’s declining birth rate.
The downturn marks a significant reversal for the world’s leading condom brand, owned by FTSE 100 consumer goods group Reckitt, which had previously experienced strong growth in the Chinese market. According to estimates by Jefferies based on company earnings data, Durex sales in China fell by 5 per cent in the first quarter of the year. This compares with a dramatic surge of more than 40 per cent growth recorded in the previous year, underscoring the scale of the recent slowdown.
Analysts at Jefferies attributed the decline primarily to new advertising restrictions, which have reshaped how contraceptive products can be promoted across China’s digital platforms. In particular, Douyin, the Chinese version of TikTok owned by ByteDance, banned live-stream marketing of condoms in October last year as part of broader regulatory changes targeting sensitive consumer categories.
These measures form part of a wider policy shift by Chinese authorities aimed at reversing a steep demographic decline. China recorded just 7.92 million births in 2025, less than half the number registered in 2015, highlighting the severity of the country’s population challenge.
Over the past decade, Beijing has progressively dismantled its long-standing population control framework. The one-child policy was formally abandoned in 2016, followed by the introduction of a three-child policy in 2021. More recently, the government has introduced financial incentives for families, including annual subsidies of Rmb3,600 ($531) per child under the age of three, in an attempt to encourage higher birth rates.
At the same time, fiscal policy changes have also affected contraceptive demand. A value-added tax (VAT) exemption on condoms, which had been in place since 1993, was removed at the start of the year. As a result, condoms are now subject to a 13 per cent VAT rate in China, increasing their retail cost and potentially affecting consumer behaviour.
Reckitt remains a dominant player in the Chinese contraceptive market, controlling more than 30 per cent of total condom sales, with Durex accounting for roughly one-third of the company’s emerging market growth in 2025, according to Jefferies estimates. However, the latest figures suggest that this growth engine is now facing structural pressure.
The broader performance of Reckitt’s emerging markets division also shows signs of moderation. The company reported 7.6 per cent growth in emerging market sales in the first quarter, compared with 14.6 per cent growth in the prior year period. During an earnings call in April, chief executive Kris Licht said Durex sales in China had come in below expectations, citing the combined impact of VAT changes and increased promotional activity by competitors.
Beyond regulatory and fiscal shifts, geopolitical and economic conditions may also add further pressure to the category. Analysts have pointed to potential supply chain disruptions and cost inflation linked to instability in global energy markets, including developments around the Strait of Hormuz. Malaysia’s Karex, one of the world’s largest condom manufacturers, recently warned that rising production costs could force price increases of up to 30 per cent.
For Reckitt, the slowdown in China represents a setback in a market that has been central to its global expansion strategy. The company has invested heavily in the country, including establishing a global research and development centre in Shanghai. It has also introduced product innovations tailored to Chinese consumers, such as condoms lubricated with hyaluronic acid, a skincare ingredient widely used for its moisturising properties.
However, tighter restrictions on digital advertising are reshaping how consumer brands can reach customers. Over the past year, livestreaming has been brought under China’s broader advertising regulations, with increased scrutiny applied to the promotion of sexual health products. Analysts say this shift is particularly significant given the importance of livestream commerce in China’s fast-growing consumer economy.
According to Jefferies analyst David Hayes, the new rules are likely to limit the effectiveness of livestream-based marketing for condom sales, which has been a key channel for consumer engagement. He noted that even compliant livestream content may struggle to attract audiences, as regulatory constraints reduce its visual and interactive appeal. “A livestream that complied with the new regulations could now fail to engage consumers: with no demonstrations, no close-ups, no claims, no interaction,” he wrote in a research note.
Despite these restrictions, Durex products continue to be promoted on alternative social commerce platforms such as Xiaohongshu, where influencers are still able to engage audiences through more indirect marketing formats. One recent livestream reportedly ran under the promotional theme “no limits to female happiness,” highlighting how brands and sellers are adapting to the evolving regulatory environment.
A person close to Reckitt said the changes in marketing policy had weighed on sales growth but did not indicate a fundamental weakening in underlying demand. The source added that algorithmic adjustments on major platforms have reduced the visibility of sexual health-related content, affecting brand exposure.
“Algorithms have started to deprioritise content of a sexual nature… as a result, some Durex-related content has been deprioritised on social platforms in China,” the person said, adding that the company was actively adjusting its strategy to align with the new environment.
Overall, the combination of tax changes, stricter advertising controls, and shifting demographic policy has created a more challenging operating landscape for Durex in China. While long-term demand for contraceptive products remains, the company now faces a more constrained and regulated route to reaching consumers in one of its most important growth markets.
