DADA - Earnings call transcript Q1 2021

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Operator

Good morning, ladies and gentlemen, and thank you for standing by for Dada's First Quarter 2021 Earnings Conference Call. [Operator Instructions] As a reminder, today's conference call is being recorded. I'd now like to turn the call over to the host for today's call, Ms. Caroline Dong, Head of Investor Relations for Dada. Please proceed, Caroline.

Caroline Dong

Operator. you, Thank thank and joining today. us Hello, you everyone, for

services. release earlier IR today Our global at first is distributed earnings XXXX newswire on as our quarter and was available as well ir.imdada.cn website on

Kuai, and On the call will Mr. Chief guidance. Chief from Officer;. and company Dada, will highlights, Jun by Chen, Yang, Officer; Beck discuss Officer; the Chairman about Chief Mr. the Mr. Mr. to Technology talk we who financials that Executive follows. available Financial and have during today Philip our and Co-Founder and operations be will questions the They session Mr. all followed your Chen, answer Q&A Kuai

in ahead. events during remind It now Executive introduce that Reform company new Chairman U.S. otherwise The the or like a that, we of and result risks, results applicable under statements call are my pleasure go as law. included actual Kuai. the SEC. in XXXX and stated the Securities I'd current all Chief regarding Exchange RMB. update are information, Before information not expectations in current as upon note in cause with or any Act defined and performance obligation XXXX. is the of difficult to company's events future factors other which beyond control. to this are to may risks, is Litigation Section except you call or uncertainties the and statements Mr. a of company's all the to please Further and mentioned market Securities figures known begin, other undertake based U.S. conference Private differ risks otherwise, These Philip, of unless factors, management's which are of predict these to forward-looking operating materially. Officer, conditions our the any XXE contains or unknown filings of to forward-looking this conference These and does required Act uncertainties manner company's as relate forward-looking statements that and involve Please

Philip Kuai

very you, us And for much you Thank thank Caroline. today. all joining

to JD We and with seamlessly total started all. financial CAGR with our opportunities. goals, achieve XX%. a for QX cooperation to a various empower generated about we I recent will covering despite scenarios and to deepened a on retailers cooperation demand is talk QX first some two reached year-over-year for will Beth XX% to X.X On of guidance. the some from our revenue reached quarter of beyond XXXX. average rate Over of demand Revenue with growth will omni-channel XX% JDDJ JD. from million March continue and experience, cooperation more devoted delivery have aligned kick-off with Leveraging interest anniversary net increase XX to issued fuel ordinary growth for which brand strategic JD, hand from two superior talk for stake categories platforms, rate to shopping XXXX. retail and The billion, market the pleased its base increase with when of are the cooperation The progress quarter in under the we deliver I'm and support on you to XX, to the investing collaborate high-end strong shares. calculated explore through newly going of XXXX. year between better will XXX strategy. announced compound Together that our partners The JD our consumers was by XX% U.S.$XXX and to high highlights JD.com local we retail in-house and two investment year different over strategic total promotion JD.com synergy omni-channel Group a expand million April the of with With then JD results. provide Dada and it strategic JD's win-win was

So all categories, beauty and improve apparel, optimizing of supermarkets, we health electronics, of and fine marketing are operational working exposures, activities and and including together demand service across we're on on-demand product JD.com the etc. Especially, consumer on consumers experience to JD. innovating offerings access the meet needs points consumer tuning to service efficiencies on

our events important total our Over by fast become year-over-year. anniversary were years, generated sales obviously we the six platform year very most across and last sells one in industry. than greater of This the categories X.Xx rose that on partner with promotion and year, by platform during on-demand promotional has past the has grown events Xx JDDJ retail the our brands

needs. tier during lower the the updates demonstrated some To a platforms than promotional significant for advantages meeting on competitive we existing we more experienced that growth with consumers in in cities the of rate. cities year-over-year provide year, tier lower over starting This momentum JDDJ. XXX% our in effectively our now entered events have So two potential and growth a

the cities and product over tier have JDDJ more than coverage last first, doubled been [ph] has in At the on-demand. quarter, categories further offerings counties coverage, our more of geographic the period] in we was year. So platform provides consumers first [same constantly compared our end category cities, diversified over especially and our expanding to covered lower with which XXXX more

supermarket fast While many remains our path the across growth progress we have made categories. on category flagship other significant

sales the XXXX quarter, listed such brands our For first and platform. we nearly Oneplus. Realme stores now as consumer successfully on have facilitated we electronics, from smartphone In

increased and as Apple, the of Xiaomi, brands OPPO promotion sales During year-over-year. anniversary from than mobile phones all Xx by more such Vivo,

access all stores on Lenovo's online the collaboration bring Lenovo's provide to to consumers We and to strategic the labels local also other with of XXXXs brands products PC with offline deepened demand.

product our to consumer continue offerings we line enrich and cosmetics, For improved experience. to improve product

onto we Sephora, we Worldcolor offline retailers platform. also as Colorist. their have with our and partnered leading For example, bringing cosmetic newly such And progressively stores

a sports brand. of brands new such Skechers, number and a few distributors Crocs, platform, Chinese attracted the we apparel, leading to For and as

We the brand will expanding especially men's our segments clothing partnerships, and focus category. sportswear in the apparel the on presence to strengthen continuously in

with baby brought deepened we the [KissOne] a all and the cooperation our player our in category, and mom country leading across stores almost onto the For their XXX platform. have of category [ph],

Five and are collaboration appliance partners. appliance our appliance, cooperating we're one-hour with our to platform. platform. who XX and [indiscernible] our home And newly partnership home established supermarket We delivery now our Star about and with various on we on more relationships chains provide For for our said consumers retailer brand that, deepening continuously with strengthening buys leading

chains we collaborate with today, to XX fresh on-demand Fresh open the more category, on in front as As with the products have partnership to and platform. of us further offer warehouses product of In an delivery partnered JDDJ XXX of JD.com. China. and demonstrate advantage allows launch Miss both This consumers fresh their we officially our top supermarket end

that the service for retailers increased picking digitized and stores saw cross picking adoption. Our are also

fluctuated Dada provide The the bring increased operational packaging XX%. fresh order last is and XXX% fourth riders labor goods great the service So picking solution a of volume for quarter costs. meet in of it retailers the picking to demand took comprehensive in efficiencies. improving now a We're by the year for to of to set QX solutions and process retailers struggle down the to and expanding declined replenishing the who by from time

talk partners. for to So the I'd service about on, like online brand moving marketing

quarter, revenue remained first brand increasing partners During marketing over the by online XXX% so from strong, year-over-year.

with deepen partnerships helped consumers. service marketing to them a continue especially number engage that brands, great our We omni-channel effectively international for strategic with of and targeted

was a launched jointly we delivery brands called super new JD.com example, For with brand XX. omni-channel promotional on China May day and the campaign

event to BXC target the entire an online effectively allow consumers to process. So precisely digitize marketing and OXO, marketing the integrates online offline brands

technology China's talk by and X.Xx cell biggest the channel would increased partners. platform phone like XX, I and JDDJ our year-over-year China. brand JDDJ about for to empower to May retailer on became our And third, OXO innovative So

our omni-channel neutral, popular flexible it's system, online So retail retailers welcomed because an among system system. to operating open continues and Haibo be the

adopted the the as XXXX February. end has retailer increase of April, the stores the stores of of significant from system more than end As a XXXX been in of

to categories. the Haibo stores deployment So with minimum the in convenience systems, addition expand electronics and to additional chains, successfully development, consumer we supermarket scenarios

cost operational So is by omni-channel this OXO satisfaction. a iterating great enhance help consumer the address to evolving their leads standardized efficiencies as thing the is and system higher of upgrading demands. to feasibility across constantly verticals. points solution that The merchants about multiple Haibo system across implementing demonstrates with to also To the a system our operations, merchants and their pain which

products shortage added cut feature average feature automatic For new XX%. when the alone is the out during digitized a first helped SKU the are replacement quarter, which and costs managing example, down process of stock. This we an has by replacements

the also can online so upgrade that of and the dashboard the down subsidies, fees system delivery into commissions stores We the each SKU. break

supermarket Haibo which Chain have digital insights like is leading provide impressive Jiangxi merchants CCFA, been better chain in on I the and Province, our by for enables system performance a a profitability, a So Association study, at deployment the would this SKU issues across the Store identify fashion. of specific channels has and which transformation. China acknowledged to Franchise case timely the in to operational

visualized they Haibo's enable subsidy merchant to Haibo has lack to process stores, reconciliation helped efficiencies. data a categories this channels, that by and able were of SKUs. financial and OXO struggling for detailed data through caused them adopting dashboards analyze product So losses omni-channel sales we're but business dimensions, operational and across automate sales system, with boost channel operational and including to By

OXO So the improved in after merchants of over omni-channel XX% profit margin system, Haibo X.Xx. by business previously, OXO the adopting sales increased by the the from addition,

service partners. Moving forward, promote this we'll our existing of more retail to value-added

the increasing delivery year-over-year. merchants to first Dada more our on with grow by to intra-city Moving chain significantly, continues revenue in to Now, than quarter, service XXX%

and Revenue better XXXX than orders. support partnership continue to dedicated enhance business more maintain merchants and choose store rise, growth tools fast by pharmaceutical integrated starting to our QX, the In late increase expect orders of the merchants increased chain delivery around based his delivery the we channel expanding on that restaurants. for already for as penetration merchants have and partners. from category, long to with operational were to In we omni-channel more the pleased to we by year-over-year, our increasing we Were provide over service the able source continues our our to upgraded from service As offerings picking by XXX% service increasingly high-quality in are service night we to from strategic CR we Especially our see chain distance chains. each and pharmaceutical vendors, base as keep year-over-year recognized revenue vendor fully penetration XXX% pharmaceutical existing category, store the customer April. our CR our for the supermarket

merchant the chain orders to mile business, the sized Now year-over-year. merchants fast that small very also I'd platform our addition provides In delivery and In experience sized Dada to of and about than more the like talk service medium last growth. complete medium QX doubled small delivery. number on merchants

cities As XXXX to of the logistic companies provided and we over QX, counties. in of support end

deepen We our continue JD to logistics. cooperation with

During the to call to model to call. we April in we financials Thank quarter. changed earnings as will our more With that, Beck a last Chen as over light pass a the go I for successfully the you. told now

Beck Chen

Philip. Thanks,

to net order the was services due was total XXX%. the services total number go ways merchants. increasing our driven for I'm believe our increased a comparisons percentage by going in most largest all consumers. performance, will the housekeeping delivery We year, changes few in to to over driven volumes the Before numbers, revenue The year-over-year to a chain The useful are by give advance. Now we just million over average XX% the in increase judge quarter figures items mainly be to increased year-over-year Net net renminbi X.X on mainly by basis. and from increases online otherwise same to XX% unless marketing order a The revenues companies are of from last million increased from increasing active XXX to XXX noted. JV billion. and JDDJ by in Dada revenue by year-over-year which revenues all services value to XX% And intercity

mainly cost stores paid over rose expenses companies at on marketing intercity to to first as based share the as increase the the was In to year, to the in and per their and non-GAAP expenses platform platform. due increased Moving expenses the fees $X.XX of and JDDJ Selling incurred share was retailers expenses quarter side, of increases providers on expenses diluted services,, last the to services growing rose million because continues XXXX. personal and services increase and staff to provided for increased as To Now third-party slightly platform. the to R&D compensation and marketing and merchants mainly new personal G&A mainly JDDJ to compared contributed due non-GAAP billion, order increase to that with increasing net XXX incentives company XXX an chain result professional consumers the loss was to ordinary the to consumers to million cost the XXX technology to a JDDJ XXX development research expenses, mainly capabilities. for listed referral to fees due of XXX our to to in company X.X its logistic advertising million expenses the primarily loss attract increasing our the retailer the in QX Dada also increasing nearest to service cost. to QX, million the delivery which increasing strengthen attributable rider in as and operational in versus attributable a shareholders volume company. efforts support X.XX promotional million net the an

X.X cash cash in and and As billion XX, short-term we cash XXXX, restricted investments. of March had equivalents,

is businesses. authorized to reflects In confidence growth has months to up during The balance. Now potential by repurchase Board ADS for of the and buyback our Dada surrounded our Directors XX cash of share share million aggregate next the program in of value repurchase existing our U.S.$XXX momentum addition, our an

services as our provide. our to investors on basis a would cost debt the as last the improve recognized from we will capital understand The also our at working support quarterly quality. release. and services both XXXX delivery quarters been working will earnings we last-mile significantly the revenue paid in and revenue. like we that companies which next third-party impact apple-to-Apple XXXX, XQ to will have comparisons platform revenue our upgrade an as help off now And last-mile cost since the growth of settlement that starting through the well forma of recap mile Before change cost logistics the our and we the efficiencies capital no improve to businesses us. delivery fee, directly providing net April, the charge our riders for in business I outlook, new purposes in has aligns through net only revenue approach The efficiencies JD recognition revenue rider better QX And upcoming information pro four in for delivery provide our to to

we be So XX% expect rate XX% X.XX growth revenue and XXXX, for basis. quarter adjusting billion QX pro a X.X QX net to last-mile second the 'XX of Now representing and total net between of 'XX forma Dada and revenue to to billion

that's be and are JDDJ's rate In the addition, this strong so the QX, of second revenue we we with growth further half will year-over-year of JDDJ's excited momentum XX% in accelerating are year. growth over

the XXX and customer JDs penetration provide online superior on-demand and potential will stage taking early JD, from expect that more on-demand incremental we substantial customers other starting our impact of progressively in annual a JD will services much coverage And a we still million deepened be services and retail growth. active might for among confident with provide both we highly very are delivery QX users of with JDs in the QX. enrich As collaboration

economy together prepared work to enterprises. we remarks. the will the and of We operator ready partners This to are you. Q&A digital And enable our Thank now accelerate session. transformation our begin real concludes

Operator

you. Thank

Instructions] begin Sachs. now Keung question-and-answer Goldman first Ronald from Our the comes [Operator We question will from session.

Ronald Keung

I for result. questions have two this

that the about And you want growth half. acceleration our second the the is, JDDJ in quarter. in expect to second ask about talked we first So

which acceleration just So on on growth know can in offline lacked whether seeing supermarket the AOD which call the did accelerating sales give still according And we their are that community of impact but purchase our but of is, month some end from seen COVID, my public group say, maybe user we're frequency, we have some user and question our not and ticket drivers size, to see the want to you us that news, the that of just as some year second delivering March. during impact business, drivers mostly last all merchants, sales behind? we AOD purchase then, we're growth, high the particularly

JDDJ. judging Just want our to offline we of from healthy see growth see how are do supermarkets even actually of supermarket merchants, very is the sales also which an pie larger becoming our

So, reach patterns how portion consumers should much evolving the between different channels? the and of sales we you. how OXO Thank Chinese interpret shopping

Beck Chen

same I question question me to to and the answer. So, let the will pass first address Philip

So, like [ph]. drivers will But, the the demand increase. compared base much consumers this than is, and JD, will not grow high, there be before and that percentage larger growth like a small much, much And we actually, of right retails was of still to a year, before. also Year AOD even and also of very, we for supermarket future experiencing year-over-year have now very the also that In is QX, so basis, -- or JDDJ to number on like AOD this and and percentage of half OXO and will to in of but think the historical it course, XXX percent year actually target target much categories consumers this slightly second increase. million basically, the is factor active on example, not QX still like second of the of year-over-year we would reaching terms second basis, to QX AOD the -- of will to it's the growth the high, on I slightly expect Chinese just reaching sectors of this New attribute half [XXX] and

this on a consumers year active the of half platform. growth the will of of growth So we number JDDJ to of JDDJ for believe major contributor and the second be the

Philip Kuai

impacts. the Okay. regarding second I'll one address community group buying the

And is the [ph] you huge. we And And as or continue in QX, some so first Hubei, we or market potential of in like see, Jiangshi. believe [Fungshi] the Hunan province, of to grow all, can fast.

So those are business. buying has the province actively community most doing that group been

in province doubling GMV growth. our to a continue see So those year-over-year

province. more XXX% in we So than those grow

partnership So sure will sector I the despite I'm growth. in believe in And healthy more that everyone huge. market And also is we be been have think mentioned, and supermarkets are of certainly the by has sustainable supermarkets supermarkets the doing more this the for or been well, market community long-term tight more now so as of system, and the more affected That's this the as why the with buying. beneficial group are willing have this and more result, you we has to adopting you regulation we for almost been noticed more starting and some potential a even we're their And more group are or supermarkets with Haibo us. partnerships us. community seeing deepen are and buying all seeing

is on and store group should their way I their on community Instead, helping performance have of supermarkets, deepen also they group to us buying the partnership. community based to But buying time, group the tried this own. to So demand that the buying is for same At on to best not many supermarkets focusing the community they think realize to then, on the their be stock retail. do improve with own. compete

of another their are all that's now supermarkets the us. So partnership with almost why reason strengthening

for confident very to as with retail the certainly our are growth to group also we for -- and -- buying. on-demand percentage support. And time, compete we much providing And I to and same contribution the just their to we the And overall, community think partners help business growing foreseeable our are at growing. advanced think their our supermarket number will operation the I future. confident profitability, by grow technologists certainly to the So like the helping are etc supermarkets is keep improve and

Operator

of Leung comes Our America. Bank from next question Eddie from

Eddie Leung

with mentioned JD, have I may two guys your cooperation questions. follow about you up As

own subsidiaries, that, that which JD like use And backend selection, secondly, The how guys, -- more your current of also logistics is we and could important own for besides mini the cooperation other be and you more program. channels, the then, natural channel speaking, in current APP first one for acquisition thinking the with earning their is is channels from consumers, including you they user roughly their heard call about the your guys. versus status JD about

on user beside acquisition any So, channel fulfillment cooperation the side. potential and the logistics

Philip Kuai

add. So, I Beck perspectives will provide to will and if some have anything

about low, as demand or very like JD.com, thing and the user low very first even today, retail on the of digits penetration, of So the is single for in penetration low, acquisition the user lower. so,

the we even So both like all but we time, to have fully penetration at XX% us are the plan aligned this same the to goal penetration. the or increase and to same and more. JD grow way And to grow

for I So the even because -- beneficial, with providing to be believe time. lots and user quality strategically JD will user acquisition grow channel and more user to is will fully JD the more the base the help was historically, of a at aligned. And a dominant JDDJ. become a this mutual important But year, JD that frequencies which stores since offline same JD grow think inventory, and and not very user lots not this will like we're absolutely acquisition we're significant And JDDJ. for we channel a

penetration their user the base will to increase in to our we to and grow JD user frequencies will the base. JDs and capabilities expand leverage So continue

give some mutual seen you partnership, partnership the be the or that will will the in the the foreseeable beyond in more think examples. strategic like beneficial. And scenes the some -- few I definitely more future, of believe quarters it I will be we and next the user just definitely

mentioned. the you as logistics So,

stores heavy already like to the way as or to radius. imagine you So, and high delivery and near depot's the warehouse one the mile three products miles is from chain as order or or bulky JD.com, cold key even the to the of customers cost the are located and heavy in all for can [indiscernible] customers, products warehouse some those require very

capabilities certainly like cost efficiencies inventory entire delivery leveraging our demand, logistic on So the already located in offline improved. the and greatly and stores, will be

this be think for for and for retailers well. our mutual So again, I as beneficial us, brand will JD, for

already case Unilever, in with in called XX, and we Another their Solution. example mentioned remarks three had the very that China, JD a May we successful the brands partnership as way, have World

So, their in or as ice cream sodas well JDDJ. JD.com as

to So three together offers a partnered marketing joint program. launch

search So this improve improve well the again, the helps as to to efficiencies. performance as

So things like that.

much very JD of confident are synergies and forward we a partnership looking strategic that lot to that. So can we be this seen from much very are

Beck Chen

More about just points the my activities. from yeah, -- marketing side we is, touched marketing like innovating

So side traditionally, there's teams brand brand And the between the with of is cooperating is side. online OXO with just and two some some we inefficiency are offline team JDDJ the us. cooperating team like JD and separate of

prepared sides. are the optimizing and mentioned the sides like of future, will marketing a for we partnership in potential are to we to revenues the for tuning also, tightening now, offerings, previously, huge. we that collaborate believe with we both right fine So that the both remarks the work together in the exposures actually And brands. loose of the points the have and a is we relationship, and little unified product the because in some campaign with access marketing And

huge, us. like some We ahead of opportunities expect huge there's even

So you Yeah, soon. will so this it addition. is maybe see my

Operator

Next from Jefferies. at question comes Chong Thomas

Thomas Chong

congratulate strong guidance. questions and on my taking QX Thanks a management for

timing should course, and supermarket in economics cooperation contribution I how future? questions. different for lawn or during the line housekeeping I JDDJ of the last about with ask and terms the may the quarter? the marketing, we of JDDJ about monetization the ask is we And unit our question and GMV about should the JDDJ, the commission also like think return about think delivery how into May Given profitability of about JD, oldest my from the the potential into

Philip Kuai

Supermarket question like category is contributing in you QX. GMV total Thank Okay. XX% for the the of Thomas.

So the XX% supermarket accounting for for economic. like

no is also so like JDDJs generally, collaboration ourselves see potential we the similar dependencies of terms products in same. out also launching prioritize our for monetary to And -- on and level very right for is in of us. now, we the total, and half. big expect of basically right or between together, subsidy now to second offerings there difference set, huge some like side And JD the actually, or optimize JD and platform the So are this effect merchants it's the strategy, growth the the momentum on coming we the very and

Just imagine on active million JD. users XXX

and soon when big So not breakeven is level like possible. the optimize or to will is further growth the it achieve and to like and we subsidy help enough profitable as as

direct So, generally, our game, we our level particular unique is and we this our expectation. earlier margin think opportunities prior the optimize growth with pre-previous And you. -- potential bigger more even than have to than expectation. Thank

Operator

Ashley from Suisse. Xu next comes Credit question Our at

Ashley Xu

guidance. follow second on up our quarter quick a Just

of check plans with second terms category more And of to user in for expansion terms any guidance traffics? does also what for there reflect currently of the geographic the JD terms both in our are starting cooperation in concrete want quarter. Just especially and quarter, cooperation, our

Philip Kuai

Okay.

for yes. question, first So, the

direct tier cities of suburban or and lower the those cities areas operating the into penetrating are like to we also So, cities.

the have name are traffic see we plan, And even some access you're the are expecting are And worked JDDJ actually, also into the all JD didn't and And for points. previously including -- very called as some like are and So, this together the new trends and detailed with there into upgraded other. partner to April cooperation parties QX plan, guidance, brand to in actually, the previous tend like each a is and from like concrete to it sitting accounted and think, have already I -- we we well. or giving starting plan in in plan, terms we including we -- the like out. very of maybe soon May, we'll

right is last under So, like now minute, the the still development.

So coming we possible. have as as know will it's as soon as guys soon you out it we and think

Beck Chen

a to Yes. add bit. And just little

as from geographic our happy the coverage to some we're will more got mentioned, as able offline the winning you up and the to more categories. now, to partnership with board. retailers to the other consumer from have in more see well, we're And sign And categories, confident as the we So, able growth to certainly see leadership and electronics. think best expanding a JD, very that to with And concrete and like to all, category, terms agreement categories. we're a of we're cities we're we the care expand the that And -- of on to to more expand and at also like at happy top geographic personal first beauty level, continue are JD. to seeing early we're I we top good arrive see a very momentum very at

omni-channel and strategy JD absolutely top is units. business for very a other across aligned this like as a JD the And fully leadership. JD with all general considered executives priority is top So managers the

So get retail as now as this support be is in we'll based on business. may future be is in and I being also, as the optimized access near to well. more important. And see able -- more demand very JD future app think result, foreseeable points to to be from JD able a you so And the to location the

chances experience to will demand more So on this retail. have users

that So agreement is we at arrived that -- JD leadership. already have agreement with

So, outlook. I about confident much think we're very

Operator

Next question Morgan comes from Stanley. from Qianlei Fan

Qianlei Fan

two have questions. I

second quite strong. JDDJ first we the is that quarter guidance the see revenue The for is,

should So very also the be GMV strong. growth

can orders from Thank the direct what the any platform Jing So subsidy Jing we some any are GMV the we is merchants charge others color second basically, assume Ze Ze question JDDJ our my by system, will Wu orders we need have positive on and margin? GMV? just is to marketing? commissions the that Wu JD.com, These for And we will projects you. that that in from from from growth positive pay some the those Wu contribution from these do growth, Ze to Tian come are questions. much those that Tian system? then onto we Tian Jing developed how in direct within merchant for So probably of it's pay And Do like and my platform ourselves.

Philip Kuai

question. the for you Thank Okay.

for right new onto developing systems operating platform on natural now all, them through the and to merchants the merchants, guides of the simultaneously. jd.com all or is those guides and selection JDDJ of invest actually. First sales

JD already to will just like consumers. said guides in to benefits in customer still to access we question, in we Ze of the a subsidies long the for of this Ze, I as JDDJ the categories, system the machines. And But businesses, of contributing get in Tian JD us also the some the guys slightly Jing more contribution previous and the those Ze of is that to Wu and Tian So we to or the Jing Wu the year, attract as down contribution to that invest improve in as half the now, through Wu be the given economic the JD.com like still retain linear like or percentage points Ze terms Jing -- operate cut have bigger so, QX right products on second of got moment, Tian Jing the consumers -- this future. quarters, significantly Tian margin in And unique and the on following of direct is -- our actually make JD.com. store JDDJ will like a plan supermarket to at for in the and have invested it to we a expect example, the the bigger lower subsidies the QX, growing Wu

planning. So this our is in all

Operator

Next question comes from Yap Alicia Citigroup. at

Alicia Yap

the pretty questions. imply growth related JDDJ to over out seems couple like Number roughly to it that maybe the the take if quarter amount XX% a at rate have XX%. decent I expectation, guidance, a growth for growth actually second one, we

outlook you you these also competitive advantage or and a makes bit also it attracted the orders Haibo from that So serving? bit landscape to very demand competitive overall chain can what is versus coming if order SME these and merchants you a the also for little elaborate maybe the your for on-demand system then, differentiated you. are of elaborate the Thank that differentiation And on can little delivery? second, retailers

Beck Chen

Thank the first the you for I'll question. question. address

Okay.

that and starting in be individual businesses, wise chain only the standards will the sized terms like on basis. recognized -- the Dada merchant Now businesses the side, basis, like of actually small merchants medium recognize for from and gross recognized will businesses QX also So guidance, a the last finances counting chain be or revenues on the that QX, will -- mile only

chain merchants means actually, very which growing is business fast. So

from business, half to we over still second the QX China we are largest very than the year, half first of that even of chain surpassing we even merchants in second platforms by growing So we businesses [indiscernible] two like the platform that in interest strong. we And year, XXXX. confident chain of for just in -- And we quarter, in this business years, do the believe again believe delivery in businesses after actually in started maybe is triple that this kind more or be will provide, grow will those at the to maintain the more rate. of it's merchants businesses, half the to a expect two this the the XXX%. And chain this merchant China. QX business And every second digit growth

Philip Kuai

And system, the the fulfillment And we regarding on-demand have are and Because best with first the very tools supermarkets since from do have functionality technology the our to XXXX, like to retailers, work to their the retail system. to platform Haibo business. since operation all, we we been first then, other the with retailers. anything providing especially so of help

practice. together that's the able retailer's system grow JDDJ with are why and Haibo So the to

like we able cases able has use the the to and Haibo see all that's players are So and sophisticated. of able to and in more advanced almost with all that's why first, to why And been the improve systems. more getting work the we're leading market

foundation that think unique best a solid a very solution I the a makes is in Haibo this market. very and

is can our dominant. you overwhelmingly like As see, adoption

neutral wisely over -- and like and our with foundation. have That's we So the been years, the the the that's are system Haibo And functionality second, retailers. we with that's retailers. our we think I why technology compete And JDDJ, because number trust wisely platform by the a That's partners. appreciated never pure why one establishing very solid like efficiencies leveraging to the like retailers access their charters information. or, -- retailers system And and and because the their that with we're sensitive to Haibo those improve margin given of able the And deflate lot there information a information. very of even partners, some sensitive those for the information. capabilities, with improve to needs work information

is most much So market. system we in also position the this those very as helps kind Haibo I think unique. trust the, also the that competitive believe us And to of

Operator

Leung comes Robin question next Daiwa. from with Our

Robin Leung

on the a acquisition JD. I've in up questions user follow

Jing user noticed there a channel So besides acquisition Ze, Wu that Tian we [indiscernible]. is also traffic

So from we be the can difference you. of and for management is also supermarket? this? our cases economics expect is plan convenience on is should the system to monetization to on that figured from paying that starting can in JD synergies share these the my in more the the too. use and second the and is supermarket Haibo the the our coming like Haibo know differences any we We system, as that channels traffic from the channels second unit do JD traffic is the more supermarket if half? Thank the the store? And question fees now using JD in JDDJ in and of the would great is new channels expect Or it existing the in already percentage this comparing to we channels How

Philip Kuai

to if will answer and Beck I brief Robin. you, a anything add. see you give Thank have

are and JD.com. we of First a are we have getting can points the JD and and experience development [indiscernible] like and like on with And And has access that. a retail all, with demand customer effectively through experience the that research currently the access reviewing are the for comprehensive best on kinds going of performance there that now points from points designing access technology we're thanks many customer of the we R&D, all team, like process noticing get most -- the we JD.com. the way

page. the now Wu from like have So the seen things you search the Ze all result Jing Tian [indiscernible] the or

more So the and future, those conversions we advanced are And partnership. the advanced with this believe etc. and like a more practice be we [indiscernible] seeing will better a foreseeable performance and cases that before in

previous the collected data already So points based previous from cases. on [indiscernible] our

as we practice. Haibo will all continue we a have handled providing will forward, the to system, And the added not be think by going we the I retailers Haibo more commission around I added like end think that's But points we system already system in more to providing from in as will to kinds collect more of as something So both all as like more model. fee board, I And we terms -- so more be to that better have of across from are our licensing retailers doing. well. we services with necessarily been value, opportunities additional GMV their value can think I continue Haibo monetization, getting performing brand, for the monetization bring first future, the as value we're envision able in the access service of well revenue monetization

Operator

KeyBanc Capital Market. Hans Our question from at comes Chung final

Hans Chung

to scenario And the to a terms quarter frequency of XXXX? pandemic observation in So, and recently if can for then in in requires second a recover And started in as couple on the how the JDDJ then about you and the so and those of us and on. pre-pandemic, the evolve How is half? shopping the right QX? for how retention for then the the and cohort evolved just year second be color label questions your for you about like and question customer customer about software about give those me what's color then, behavior first, thing, and the -- and possible, the customer the also consumer customer behavior then, can we past margin second provide well like behavior the does

that be Thank helpful. you. will So,

Philip Kuai

is second be first margin the record which the the during X.X%. quarters for question, next minus so the And leave in three that the would declining. benefit QX will it so year Hans, of for

the mid consumer QX to quarters is the we also So level and and And back record worst. industry in the and QX margin the the will in terms QX three following in is the of is X.X% go also incentives, down. the are -- highest subsidy level for level, the

Beck Chen

and China, in era the And are on-demand. we're to used of even post-pandemic so we're for like the online customers to especially seeing behavior, Yes. are terms Mainland that seeing things then customers recall more buying in customers

seeing customer like I think permanently. we're this absolutely shift behavior probably

And are from these we the delivery trend a buying benefit customer will and food more that delivery more customers like from to same seeing to now everything grocery And demand. are so, at the buy trends. our restaurant I on absolutely categories, business a now used been to educated then think and time, and like has

this one is everything that in aligned become think vision available with hour. our fully I will

happy see the we trends. to are So,

Philip Kuai

rate half. and JDDJ, compare China in already when in pandemic now to that and is much QX actually are the more down, the in even you second also we growth go the QX faster, XX% settling XX% in than expecting And faster for the

a which our among So also demonstration popularity platforms consumers. for

Operator

Thank you.

further comments. We no have to for any I'll final questions. hand back management

Caroline Dong

on we'd Operator. to like thank you, Thank Dada's today's your participation of team, In you management behalf call. for closing,

information, any to require feel you reach the free call. today. you further us us to If directly. for joining concludes That Thank

Philip Kuai

you. Thank

Beck Chen

Thank you.

Operator

all for joining. you Thank

now disconnect. You may

Dada Nexus Limited (DADA) 8 Jun 212021 Q1 Earnings call transcript