Q3 2023 Dada Nexus Ltd Earnings Call

Good morning, nitrogen gentlemen, and thank you for standing by for Dod Us third quarter, great rates rate earnings conference call.

At this time all participants are in a listen only mode.

After the management's prepared remarks, there'll be a question and answer session.

As a reminder, today's conference is being recorded.

I'll now turn the meeting over to your Hartsville today as cool as Caroline Dong. He don't want Mr Relations for data. Please proceed Carolyn.

Thank you operator, Hello, everyone and thank you for joining our third quarter and between the three earnings conference call on the call today from data, we have Mr. Jack weekends, where practical.

And Mr Beck Chen CFO.

He said well we are talking about our operations and company highlights then Mr. Chen will discuss the financials and guidance.

Candidly no debt.

The Q&A session. Jack will also question in Chinese and then consecutive translation will be provided.

In case of any discrepancy between the original remarks, and the release and the translated version statements email original remarks she'd appraisal.

Before we begin I'd like to remind you that this conference call contains forward looking statements. Please refer to our latest the safe Harbor statement in the earnings press lists all of our IR website, which applies to this call.

Also during this call we will discuss certain non-GAAP financial measures. Please also refer to our earnings press release, which contains a reconciliation of non-GAAP measures to sit comparable GAAP measures.

Finally, please note that our lives otherwise stated all figures mentioned during this conference call are in RMB.

It is now my pleasure to introduce our president Mr.

Uh Huh Yeah. Please go ahead.

Thank you Gary and thank you all for joining us today.

Good.

Quite well.

How do you see Google since then.

Top line growth and I noticed there's a gain operating efficiency.

Our total leverage increased by 20%.

And Justin that much even through the pipe.

Yeah, one percentage points year.

Oh yeah.

I'll, let the team based on taken release are based on a comparison.

<unk> Dot com.

Our performance through the tablet.

The shopping basket.

What are the operating highlights of our two platforms.

I'll, let Dan Beck, who will.

Thank you so our detailed financial results.

Plus.

Yes, it's Scott.

<unk> Dot com.

In October.

Got that group in the Dot Com has.

And on demand as it tells them that confidence.

It seemed that happiness within each well.

Well, let's see what's out of them.

And we had the effect you actually close to consumption.

Hello.

Create a jobs.

That's particularly.

Yes.

Did you did you end up back on all of them.

And to facilitate the on demand consumption.

Well once again and do it at all.

Our ecosystem partners.

So that was a digital transformation more than to move in.

And Mila stores.

And Thats accumulatively create or 10 million, that's why we call it opportunities.

This not only demonstrates our strong confidence unit potential demanded Italian that's true.

But also our commitment in serving and social responsibility.

Does it all come in so with Janssen Corporation seem to assure this goes.

Yes.

I'd like to provide highlights from that it's all about Ww shopping with us too.

What did you do there.

<unk> reached at.

All time high.

In the midst of all of it the promotional grew robustly.

It's multiple countries not just in Shreveport did you close.

Including new quote.

Mom and baby products.

Foundation, and the convenience stores.

So with that at all.

The other one is a good date and not get caught up.

Hi, all.

15 million.

And the total or the welfare that missed it.

200, and median during the promotion period.

It's more on to the operational highlights for our two step home.

Starting with kidney disease.

Leading on demand at the tail platform in China.

In the third quarter.

We continue to strengthen and expand our partnerships with lip palettes and advance.

And the subway and homestyle, the booties and technology innovation.

Having recently Pella a combination.

During this quarter.

Continuing to broaden and deepen our cooperation with the pillows.

To your new product offerings.

Okay.

September.

JBT has on boarded more than 400000 to the pet stores.

Yeah.

The silver market, particularly.

We added a more top supermarkets tends to outperform.

And they have long established partnership suites.

Like you said all of the top 100.

Supermarket attempts in China.

After all it's also the labor content and go to a majority of our supermarkets across the country at the end of July.

We saw a lot of an increase.

User engagement.

Evidenced by improvement in both the pension and the <unk>.

Such as frequency among our U S S supermarket testing.

We also made progress you know Corporation Luke.

Major Columbia in the stores.

<unk> trends.

Moving to Germany, Germany is a bank in London.

C stores.

Upon closing more than eight times year on year.

More on the consumer electronics.

So carefully.

We've got some my phone subsidies tend to hit the DTF participated in the launch of the new Apple products for the fourth.

Conceptually yes.

After the iPhone 15 city I suppose officially launched their first sale in September.

Yes.

First the two hours.

Increased by 250 compared to two of the.

IPhone.

14.

Thank you.

In addition.

Under our plans such as Xiaomi and oneplus.

What's sort of left to close during the third quarter.

Well the computer and.

Access is particularly.

G&A increased at a time.

<unk> year on year.

This growth was attributable to.

Our support for new plants.

We can match to humans.

And our athletes to explore divesting show piece and on us.

Notably one such as stout.

Shall turn time G E.

We experienced significant that there was you should.

During this quarter.

Yeah.

We also continued to make progress.

The home appliance and home furnishing category.

In the home of Prime sub faced politically.

Yeah and to sell with diversified USA news offering.

A T. The skus and the compatible with neutral to China's.

Our offerings and enhance the experience of one stop to be about.

And the installation.

In this quarter.

We've established new partnerships with major appliance brands.

Hi, Hugh and his family.

And the newly on boarded.

So then the home appliance stores.

While per phone.

That's a result.

Our home appliance and a chance grew with the buyer.

70 year on year.

The home furnishing such because they're also sort of left to close.

With <unk>, increasing by nearly three times year on year.

He has established a new partnership with clients such as.

The bonds fashion.

Achieving a peso in our offering.

Turnkey services.

In the apparel category.

We recently signed a new partnership with suites and bank of outdoor plants.

You couldn't shoot to Cook.

That's S, whereas under way our plans.

Such as supposed to deal and I know in the home depot.

And to the luggage brands such as needed.

In the third quarter.

Of that Palo kept the increase in more than five times year on year.

What are the local category.

Yeah.

Do you mean more than tripled year on year.

In the setup of it.

Driven by our continuous efforts to improve the supply of core skus.

That's.

Let's talk about the JP tedious process.

Dependent correlation with brands.

That's a pioneer and leader in ultra I'm asking for clients.

In September.

We officially launched it there.

Bancorp 10 billion pounds.

Which aims to have more than 10 plants achieved sales of more than 1 billion.

They establish a benchmark brands.

Sales of more than 10 billion on our platform.

<unk> hundred four.

Yeah.

Our blended panel poor kept is expanding.

Recently, we formed partnerships with leading biofuel plants.

Couldn't maritime and the young.

The first on demand and the performance based comp please.

We also established a new partnership with slack for the plants.

So I guess the engine pools.

And the stat events.

Let's listen and that yeah.

We also continued to enhance our omnichannel ultra matching cooperations with plants.

Chop intend, which you also saw my people China's both of them and opportunities here.

Starting in September.

These clubs Ikea to lease land such as quickly Oh, Yeah, and then backing.

To help them to enhance your exposure.

Wow.

In the late Q offline campaigns, such as sunscreen.

Okay.

See competitions.

On the final day of the U N. They use in Shanghai.

Pretty good and the muscle.

200 tonnes a year on year increase yourself.

And 68 with a UK, Sweden, although one of them.

Okay.

Yes.

I'd like to talk about our technology in June.

<unk> efforts.

Well the pillows.

How many kind of ultra operating system in a high growth continues to play an important below.

Mhm cooling efficiency.

Is it I know it dipped.

Hi, Bob had been deployed in nearly.

Paul the saga in the stores.

We recently upgraded the hybrid systems, which are lifestyle store taking.

Function to support the additional business with Pseudomonas.

And Mike you went through the country and more efficient so you play to your debt.

That lead them.

Nick.

And at the merchants, who use status updates of function.

So Nike my job is well taken.

Abnormal right.

Four plants.

We further upgraded our mapping technology.

In September we really do expect equal.

The first step through the lower Muscatine.

Lance is on demand at the <unk> industry.

We can improve there must be efficiency.

Repeat dosing class Ultralow Omnichannel data and then suits.

The house brands.

Marketing opportunities grew but I believe that in terms of boats.

Consumer demand and that they are surprised papers.

So as to make my TV campaigns more effective.

That person.

Clinical system has been adopted by 10 plants in catalysts, such as <unk> and.

Consumer electronics in the past and awareness.

I don't know the plants I used a clinical solution to a managed market activities.

So the conversion there.

The increase was led by Paul put some put some teeth.

And I always your customer acquisition costs that decrease with time.

37%.

I realised tend to buy them all.

Maybe local on demand it could be your platform.

In the third quarter.

We continue that we extend our liberty capacity.

With quarterly active a lighter on the Dod on our platform increasing more than.

Punting year on year.

I will first discuss our care.

I'll turn my chance visits.

In the third quarter.

The cost of labor.

Melanie upfront.

On demand to give associates, who can that change.

Another issue that pool pumps.

<unk> five year on year.

In particular.

One with them.

Okay.

To go after the fact.

Hi, Barbara.

Due to the late.

In addition.

And the next time the kids category.

We lifted and formed a new partnership with less than the chance such as Gio, John and his team.

Whereas tencent cooperation with lithium plants, among our existing partners.

Moving onto our SME and the synchrony citizens.

Thanks for a wider.

We're allowed to answer.

Selections.

The landmark assembly and see to see others fulfilling in the third quarter.

Created by 40 year on year.

Lastly.

Update on BARDA allows pretty much deal with those.

We continue to consider.

But did you mean, it's not just that it's hard to much deliver platform for supermarket in China.

Debate.

Goddamn House at Panama D will open platform.

For more than two.

200 <unk>.

On demand appear or that support supermarkets.

That concludes our operational update.

Our two platforms.

Laptop.

It could be able to another strong quarter of financial results.

We started that goes you know and.

The community tend to year on year improvement against our potent none.

The long risk get the continuous improvement in business performance.

We do our model also creates you'll need the social value.

Therefore, we said first.

Have your plans of London.

Consumption digitalization and the employment.

Which is in line with our strategy to realize healthy growth.

You know Atlanta community.

Okay.

Consistent.

Consumers tell us Glenn to owners.

The lighthouse.

We will continue to explore the disc jockeys were to establish it.

September the dependency for shareholders.

I will now pass the call over to Pat to go through our balanced financial results.

Thank you.

Thanks, Jeff.

Before we go over the numbers just a few housekeeping I haven't seen the mens we believe year over year comparisons are the most useful way to judge our performance. Therefore, essentially the changes aren't going to it will it be.

On a year over year basis, and all figures are U P unless otherwise noted.

The total net revenue in the third quarter increased by 20% to $2 9 billion.

That's revenues front I don't know increased by 29% to $1 1 billion, mainly driven by increases in order volume of interest.

<unk> services to chain machines.

Revenues from J D D J increased by 16% to one 8 billion.

Mainly due to the increase in G&A.

Increasing online marketing services revenue as a result of the increasing promotional activities also contributed to the revenue growth of J D. D J.

Moving over to the expenses side.

<unk> and the support costs were too high then.

The increase was primarily due to an increase in <unk> cost as a result of increasing order volume for intra city delivery services provided to various chain merchants.

Many of the marketing expenses and a decrease of two 1 billion, primarily due to decreasing advertising and the marketing expenses and a decrease in incentives.

Moving to the DJ consumers.

G&A expenses decreased to 13 9 million as a result of decreased amortization of Phineus cooperation agreement and the non competes amendments related with the acquisition of J D. D. J E. T 16, which was substantially amortized as of June 32023.

And reduce the share based compensation expenses as well as efficient expense control measures.

R&D expenses decreased to nine.

The 94 million, mainly due to lower.

R&D personnel costs as we enhance our accretion efficiencies.

non-GAAP net loss attributable to ordinary shareholders was.

It was $9 million, a significant improvement compared with the loss of 217 million in the third quarter of 192, non-GAAP net loss margin was 23% improving by 11 percentage points year over year.

As of September 30th tons, you're kind of history, we had.

$4 4 billion in cash cash equivalents.

Cash and short term investments, achieving an increase as compared with the balance as of the end of 'twenty.

'twenty two.

In terms of the outlook for the first quarter of consistent history. We expect total revenue to be between street in the industry 3 billion, representing a year over year growth rate of 12%.

23.

3%. So this concludes our prepared remarks and <unk>.

Operator, we are now ready to begin the Q&A session. Thank you.

If you wish to ask a question. Please press star one on your telephone and wait for your name to be announced if you wish to come to your request. Please press star two.

You're on a speaker phone please pick up the handset to ask a question.

Your first question comes from Robert <unk> with Goldman Sachs. Please go ahead.

Okay. Thank you.

Taking my question and thank you, Jeff Beck, and Caroline and so my first question is on how we're seeing that.

Trends of growth in singles day, and based on your <unk> guidance.

Sequential sorry slower year on year growth.

Do we see what are the drivers of our growth and how should we think about next year.

Hum along the consumption trends on <unk>.

Discretionary for on demand products.

And then my second question is on our cooperation with J D.

With the J D.

Rebalancing kind of traffic that 10 billion subsidy program at three P. M.

How it has the cooperation bean and do we do we see any change in the.

J D traffic allocation to ourselves and any updates on the cooperation and let me translate myself. She said Juanita now Royal Yeah. Good he went D and Oh sure.

Strangely that Shin Kong Yap.

So get to the Truecar done John.

That's why you see it now women in Canada, or South Bay, the Chin calm Io commentary doing layouts, you should pay some diesel 100 bombing yet right.

And in South America.

Dr. Julie Hello.

Uh huh.

Oh, no I Don T ganglia, Bod put on that you said holiday I'll call lumpy Sam P.

Great.

<unk> seen no Jamie.

Yeah Ghansham.

Yeah.

Okay.

But it's a chance for <unk> sake.

Nancy.

I mean, thats M Hewett choice as it took us a few more.

Huh.

Yeah.

So that's all Keystone CIT I saw something from that.

Sure.

So it's actually took place.

Uh huh.

So we assumed a chance anybody that I kind of take the superior touch sensor she made essential amount to shelter future qunar.

You see you know, we wont corner right.

Therefore, we will also be able to choose whether to go shop in future years.

Yeah honestly within that suite.

You can either ship for most of what you would see that.

The same thing.

Thank you for your question Ronald how fast.

I'll give you a brief.

Our update on the overall performance of <unk>.

Double 11 shopping festival as we all know it's quite long.

Starting from mid to late October and running all the way through.

November.

So trying to first two three weeks of October.

Brown sand.

Supermarkets, and the consumer electronics categories, where on the softer side.

Two factors.

An increase in optical.

After the war and travelling demand and affected purchasing frequency of supermarket.

Does that makes 10 and E <unk>.

And for Sun.

Smartphone brands was not as strong as we had expected.

Now, let's see the tick.

She can melamine candela, essentially now you put sort of sometime.

She said Tulsa team there.

Joining us on <unk>.

So that I think it's useful for sure.

Can you tell us what that took a chunk.

Well that sounds good.

Yeah.

Joining us from China.

After all.

During the double 11 shopping festival.

We've seen a decent recovery and growth rate is actually a supermarket category.

Primarily thanks to our athletes and prioritizing value and our customers savings on top of our convenience of one hour delivery that we provide.

Oh.

Thank you Ken our meals at home.

Do you see that flowing through.

To this effect also to meet with you a few times, it's worth it to defend that.

On the peak day.

November 11.

We made a historic.

Thanks Ruth.

It's actually.

We've seen decent growth for the supermarket category.

Well when they show up in that country.

So this is actually Chris with J P M.

Of course, we've got to look at the surface of Huntsville.

So it's hanging in there.

We would then take the south central and especially equation some choppy.

Sure.

So foolish every time you choose to.

Super Super.

Okay.

Overall, the consumption markets recovering.

In two different categories, however, spending and services, including timing and accommodation entertainment and tourism continue to outpace.

Spending and physical goods. In addition, the need for on demand retail is less prominent and outdoor.

Foodservice consumption.

Hum.

Sure sure sure.

Oh I meant that keeps it sounds really cool Gucci, there, you'll see quite as much yet.

The overall take the tons of the central.

Do you think about so let's take a look at.

So at least with the Hudson Bay.

Neither of these trends, we will continue to focus on consolidating our strengths on the supply side and optimizing the user experience.

To position ourselves for the increase and <unk> penetration in the long term.

And about which we are highly optimistic.

You can change our disciplined Felicia, which are the G HN chipset.

Tucson to the Cheese award, which is a central New York Cool.

<unk> essentials without a yieldco to D J.

It's embedded in the system.

To provide you with an update on our cooperation with JD com.

Well, it's J D D J and I don't know continuing to strengthen our cooperation with <unk> during the quarter.

Starting with J D D J.

First we continue to penetrate and if youre in the base with the number of how should I use this quarter.

Core tax increasing by close to 40% year over year.

Let me tell you Theyre on Samsung.

Colleen you said that you will tender <unk> co funding of only two shoes that are too much in Shenzhen.

In Q1.

At this time.

On Tuesday, so each on lithium cobalt.

Then Jim sometimes unusual times and so we see this as something that you tend to accumulate the family owned.

No problem.

Our traffic growth on J D has been outpacing our user growth as we gained access to new entry points on the JD App for example.

It'll be a feature.

<unk> been gradually integrated into that 10 billion subsidy.

And.

Flash sale with panelists.

Enabling our merchants to generate incremental exposure.

The social and merchant ship when did you mention that since essentially on par with MTV <unk> didn't do that you don't change it.

John It's Joe on teaching them with you and of course, you want Shelley.

Apart from the incremental touch points with gains.

Also making progress in the existing.

User interfaces.

In terms of the search readout for example, easily J P. Dot com has been testing.

Archives audio products and categories, including fresh produce and heavy and bulky items, so as to enhance user experience while improving efficiency.

So that type of money on when we Shouldnt, we can maintain and talented team.

<unk>, Okay, I thought I heard you want.

With us which ends up.

Can you shed sushi teach them at NTT wants you couldn't have the T sand.

And in terms of.

Pat.

Previously known as nearby fully intact.

Have refined the page design the data was Daddy's project development team to drive significant growth at the same time, we are pushing forward the continuous increase in conversion rate and <unk>.

Oh, what does a detailed question.

Welcome everyone about the assumptions that you set in the east.

To use the solution.

And.

Now I'd like to share some observations.

And thoughts.

The impact of Jd's changing algorithm.

J D E J platform.

Let me caution ourselves with the opportunity to move the showpiece of TV Youtube assumption.

<unk> four <unk>.

And then the G&A sort of sampling and the usage.

We achieved another chapter.

Sure I'll take turnkey Chaco Sandal Wednesday June 17.

These continuing to learn from that.

Due to the field of heart function.

That's about it.

We believe our assertion that service not only provide JD users with high quality products and faster delivery offer competitive prices.

And from our retail partners strength and the supply chain.

<unk> is able to provide it back to you.

Thanks Aaron.

And all three dimension itself.

Prices and services.

As a result, we believe that these new traffic allocation mechanism, but benefits Josh it as well in the long term.

So that's something that we now have a phone call to Youtube.

We saw some good deals.

As with <unk>.

So we didn't and that's why you should take it from there.

Susan.

How should us advantage in terms of product quality and diversity as well as delivery Speediness is south Africans.

I would like to.

More on the price competitiveness of alright, Josh at Actavis.

Well first of all let me answer it sounds as Ashish on the podium.

Two utility that's found out that the amendment Luke and you got to do this all with a caution that because some key development potential with the sanctions to Hollywood and transition to production too.

So the years of experience and offline retail attain merchants, we are cooperating with usually have already built with strong supply chain capabilities.

<unk> provides consumers with competitive process.

In particular and put our categories, such as fresh burgers, and heavy and bulky items, where you just mentioned.

Uh huh.

G with Soma just ensure that she felt.

So depending on really cheap and some for sure. This is Sean.

Or is that totally switching for Nancy.

<unk>, which is what I'm trying to think.

<unk> occlusion.

So for that particular year, there's no long lead to shelters.

When we think about <unk>.

In addition, conducting hotel business on top of other existing offline stores require or required literal incremental rental and personal personnel costs well they tell us.

Lower selling expense ratio.

Significant room for our retail partners to offer lower prices.

How should our channel and to provide our consumers with a more value for money items.

<unk> was on his comment just on kitimat, saying isn't demand cheaply detailed family life.

So that I assumed and social programs.

We launched two sessions with you soon.

<unk> social parking left we do team up at Lewisham.

Looking at our operational results.

J D again to emphasize the pricing factor in March alright exposure among J D sections outs have maintained remarkable growth.

Encore in Q3, the daily average such exposure.

Supermarket's category increased by 50%.

Second one of course, it sounds easy to shell.

<unk> culture shock the assumption attempted sushi alluded to that that we essentially sell.

Okay.

So that's something that's in the Q2 P shelf I was looking at it.

In addition, the percentage of how a price competitive product.

Okay.

Ah stay to add about 30% during the November 11 shopping festival.

Many of the overall competitiveness of our products.

Thank you for your question.

Okay.

The next question comes from Thomas Chong with Jefferies. Please go ahead.

Hi, Good morning, Thanks management for taking my questions. My first question is about GTT, Jay you'll be economics.

Kill switch can management share about the takeaway and the expense ratio for different items and on that one.

Should we think about.

Do the economics as we go into Chinese plentiful what are the drivers behind.

And my second question is about.

The all to all opportunities.

In China.

<unk> mentioned in the prepared remarks, the market size is huge but on the other hand, we also see.

The competitive landscape.

It's also quite intense as well so just wanted to get some thoughts from management about how we think about the landscape and trying to turn a fault and on that front.

What is the long term.

That margin.

We're expecting.

In.

In the coming years.

Thank you.

So step one in changzhou Shlomo that humans.

The carbon tissue Kuan Yew J P D J D E.

I'm sorry.

Bhutan iPhone Benny Tricia, you don't hold a woman.

Christina G T J good economics.

Gotcha.

A light of Samsung compound, Nick I'll take rate.

Expense ratio that you guys got shot.

<unk> Kwon huge and go hungry.

A woman combo.

Demand <unk> Jacob quietly go based on quite well.

Well, meaning guy doing.

Good.

Competition that youre kind of Oh, you're finally, starting to sound like you'll hold stable been challenging direct margin.

But at the same type of TPI cause he can be definitely something fishy.

Thank you Thomas this is Max so Jesse.

Yes, your first question.

Jeff can take the second question so.

Terms of the monetization of JD Vijay in Q3.

The monetization rate was increased to 10%.

In Q3, which is the first time, we pass through like the 10% threshold.

Historically and at the same time.

In our consumer incentives was.

Further decreased to three 3%.

Which is either like decreasing on a Q on Q basis or year over year basis.

Pan.

<unk> cost.

Including rider cost packaging cost was four 7% which is.

Decrease on year over year.

While increased Jiangsu.

Basically because the seasonality in summer.

Campaign.

And in terms of the.

For example in that country.

Therefore, a major driver of steel we will keep to increased commission on our marketing and manufacturing all right and then at the same time, we will.

Further.

Decrease our.

Consumer incentives.

Fences and also operating costs.

Side to further enhance our.

There are some margin.

On a year over year basis.

And also in terms of the last question. Your second question in terms of the long term margin. So basically as we have talked about previously so J D. J is could be.

And that netted to two like the traditional E Commerce platform, which is just a localized version so.

In terms of like the appreciating.

Operation profit again, Jamie generated through the platform. So we are a marketplace model neutral platform model. So sure be targeted as a 3% as a percentage of <unk> hour.

Operating non-GAAP operating profit for J P J.

Thank you.

Yeah.

Okay.

Like I said the other players.

Thank you.

She's not going into the Olympics.

No.

So that's it.

Daughter, we retained the economic impact that you've seen.

Congrats on the scenario assuming is in that sense, a hernia there to their financial needs.

Well, thank you Jason.

Tinder inclusion message we call it either.

Under the program since I could see that Youll see the need.

Two quick questions.

Now I'd like to share some thoughts on your second question.

Competitive landscape.

The fact that more leading internet companies are prioritizing.

<unk> retail business.

<unk> has great potential and we believe the industry can easily accommodate different players to grow right around fleet and their respective areas of strength.

Cumulative catch IBM saw some gaps where they can achieve chairman so you'll see events within that group.

I think what the EU on the pipeline that we need to see students with some of the simple with the payment.

But should that same timeline on chicken with this impact.

So it sounds healthy manner.

Is it sort of alluded to by challenging that sends out a message.

So Jim we intend to more of a move up in the total neutral zone.

Hi, Joe.

Let's see if we could squeeze your assortments issue in this quarter Q2.

Well J D J, firstly, our strengths and extensive partnership with pay merchants remains rock solid.

As a result of our positioning as an open end mutual platform as well as our accumulated know how and expertise and empower and retailers.

Carrier systems and services.

Mentions ecosystem with no. It is hard to replicate and short time other platforms.

And supermarket category, we've on boarded 93 out of the top 100 tanks in China.

Edition in categories, such as smartphones and mom and baby.

Also teamed up with most of the leading chain retailers in China.

This abundance of high quality supply and is the basis for us to continuously attract and retain users.

But also on our new two new ships with simple Timna, we don't put the chimney.

So if we don't buy them.

Michelle <unk> chooses to exercise Susan.

So pretty consistent with the Q2.

So.

Whichever mutations, which agenda video Simpson ICU agenda.

$2 million for Tim mentioned, you'll mutual goals future.

So if there's something to announce our opinion sort of the thing that comes out of the yard Shaw.

So challenging changing million puts on tissue.

So the increase is coming down.

So in two townships in Tampa.

Yes.

Central is about changing that.

Secondly, we enjoy huge potential and penetrating more of Jd's gives us.

Currently internet companies are focusing on cultivating the mindset for on demand retail among our own user base.

Which means limited head on competition among one another.

<unk> users are inherently purposeful sharpest demand higher merchandise quality and delivery speed.

It's more efficient for us to convert them into on demand retail consumers and we remain confident.

In penetrating 50% of the J D user base in the long run.

That's one thing.

Since I'm from other tissues.

Introduces a cow to as soon as it turns out you need to keep them.

So Chen Tong secrets issue the tender.

Google Johann look with your tribute to focus on the Saudi Tivo content concordant and send them to me.

J J you lose if you take which is the sense you should consider.

Certainly in the knee.

Poussaint divisions with Kimpton, San Vicente within Kodak, Credentialing, Brooklyn, cognizant, when challenged with Huntsville cheaper under you knew that need it.

And thirdly on top.

Market share gains, we value with sustainable growth by balancing growth and profitability.

So a combination of efforts in optimizing subsidies, improving delivery efficiency and increasing online marketing and monetization.

Profitability of J D. D. J has improved significantly in the past few quarters to near breakeven.

In the long run we also believe that <unk> has higher profitability potential compared with other players tests.

Our significantly higher <unk> and online marketing monetization rate.

Thank you.

Kidney.

Thank you.

Okay.

Your next question comes from Alicia Yap with Citi. Please go ahead.

Hi.

Aha by any chance do you think there are some of the key one.

<unk> printing is Oh go ahead, Phil about people sure sure you find that Shan Shan <unk> doses, how should you think no club.

Meda ECA too sure that you've got.

And sushi gain that you see.

Too.

Now what else can you tell me.

For volt cordless phones, she easier hall, so Glenn how sure Glenn Phase how sure you saved me the sheets show you know me.

You've seen me two capacity got like <unk> T shirts at the end of our time, but when kind of thoughts about Q2 tissues ship Ah shall Jonathan Bush also uhm ammonia <unk> Santiago you can shoot Shaw okay.

No just like T cell function or how should we should see a hole from a constancy to England to shelf, what I'll I'll check one in Shanxi device you can count on.

Jim took out T. So that's I'm not sure.

Paul can you find yourself.

For taking my questions. My first question is a follow.

A follow up on our management comment regarding the supermarket and.

Electronics category before to think I think the first three weeks of October and then single stage rebounds, and so just wondering what is the demand trend posting does state that you are expecting for supermarket and non supermarket category and then second question is on the cost of riders.

So can I understand the increase in the cost of writers is related to.

These intra city delivery is at and heating related depending on the type of the chain merchants that you're servicing.

And which specific order demand during this <unk> that resulted in the higher rider cost do we expect a higher rider cost into <unk> given it is a promotional season and potentially coda later thank you.

Thank you Alicia so lesser academia gesture.

Two questions. So for the first question. So it's just like we can so we finished like Pam.

Campaign, so still there.

And then.

I don't think there is enough time for us to evaluate.

Three days.

Daily sales to give you some color or comment for the post pandemic campaigns trained.

In terms of the second question. So about the right account. So in terms of the absolute dollar amount of the rider costs, Yes, it's increase either on Q on Q level year over year cost overall, and it's still growing robustly, especially our.

I don't know if this is growing by 29%, but within which.

Accounts.

It's growing 5%.

We have discussed that before so.

So this is just the cost overruns and yes, it's growing in terms of like the.

The unit cost at <unk>.

The order level or Kurt.

Jimmy level basically.

<unk>.

Efficient and safe.

On a year over year basis and.

In Q3, basically because usually it's the.

The summer season so.

It takes more to recruit and retain riders compared to springtime or.

Autumn season.

So in Q4, we believe our year over year basis, our price.

Our unit cost.

For the riders will decrease on a year over year basis.

Okay.

Thank you you bet.

Our next question comes from Lane, Zhang with Bank of America. Please go ahead.

Hi, Glenn is on back on hospice is all of that.

Eagle one pieces outweighed yeah, all women, Chris Yeah, I think I'll, just say that Manhattan sounds Keith I'll, just go with Cisco quite Oh, taking chico's White house bilateral Wilmington South.

Now I'll go and she says don't seem to always have to say it has elements oce, yeah completely I cannot go check out ship almost all of it.

Oh sure sorry, something funny.

That woman, that's something that supports a more ship to go up at least for me in the east.

Oh Gee, that's not bad.

Thank you.

Thanks for taking my question My first question.

Regarding the impact from our pro worse no worries, that's correct quote off of what spread the leeway to RMB.

Oh Im sorry, Yeah can you share more color all day.

I can tell I noticed that that we have these calls.

So any way they pay the Lamborghini double allowing then okay. You gave us all a mole sauce on how.

On your momentum regarding lifesaving rolled out thank you.

Yeah.

Got that.

In our Windows 10 users.

This is Jim.

Linda keep them full guy that show you the Tulsa treatment.

Uh huh.

To conclude that Houston.

So could end up with something.

TTM equivalent a bias in Tulsa to listen people in Bento <unk>.

Jason.

That's happened yet.

With that said to me that is enough to get that.

Columbia funding through Sunday, we don't do.

Thank you for your question.

Since the end of July delivery fee waiver campaign.

As covered basically over supermarket owed us.

And after that we fund.

Those conversion rates and repeat purchase rates increased.

<unk> remained largely stable.

Specifically and August compared with July the overall conversion rate of our supermarkets category improved by over 10% and then <unk>.

<unk> retention rate also increased by over 10%.

It will be was substantially unchanged.

Do you think to torment him about that whole suite that G&A to the central let's say.

<unk> Castle.

So I think China Chinese maker chances for nuclear equivalent for the tungsten that's useful.

Therefore, thanks to the initiatives on a year.

Year over year growth.

<unk> of Dnb.

CMV in the supermarket category accelerated in the third quarter of 2093 compared with the.

Second quarter.

And the program will be a long term initiative to prove improve user experience.

Davita in China due to the tenure so European telethon that includes <unk> <unk> yourself with that Vishal.

And in terms of their P&L impact since the cost of delivery fee waiver is shared by us and our merchant partners. The impact on the direct margin of J D. D. J is and it doesn't it sounds gifts and manageable for us.

Okay.

So to go from you know EMEA chips.

Sure.

The important reporting shall we say that for the future.

So some of what she does something soon about that shaping how soot sensing Catherine. Thank you look at some of the Hurricane type 13.

Documenting that takes you that broker tons through the 12 months ago.

This will remain so.

You shouldn't Union Yieldco.

Do you have what that eisai, so some of the other two.

Hum.

Richard.

The truth of the shelf.

While moving tons to the Queensland, and you sort of talk about that one.

Incident reports and Delta <unk>.

To answer your second question about large streaming.

We've taken out the rising popularity of live streaming.

The single day promotion I guess ended J D. D. J launched multiple live streaming events, together with merchants and brands and categories, including supermarkets consumer electronics and home appliances.

This was the first time.

Our frontline professional teams.

<unk> engaged with retailers are engaging with consumers to offer them value for money products deliverable within one hour and we did see initial results with some sessions, attracting total views exceeding $1 million.

The total CMV transacted via live streaming and grew more than tenfold versus June 18 promotion.

I think most of them are forming essentials.

Our core yields in the U C.

We believe the other second harvest CFO.

<unk>.

Now with that element to your question.

That sounds I think Toyota Honda, So Honda how far the Tim Tebow.

We are hopeful we can continue that sells tobacco with GM.

Overall, we are still in exploration stage for the live streaming business.

To further optimize down process and enhanced our product capability.

Better integrate lbs with live streaming.

The future we were also going to encourage local merchants on our platform to host regular live streaming sessions.

To provide our users with more immersive and demand shopping experience.

Thanks for your question.

Okay.

The next question comes from Wayne Zhong with UBS. Please go ahead.

Hey, Glenn is on HOKA, because you know the T. Max Nacho Shan Shan Shan is always that you were saying that you do gentlemen, Doug I'm not sure what else, we should be doing rather quiet.

I'm not sure if I'll use teaching a tissue as I said, you do have union, yet, which you should not put horizontal chowchilla shows thiago that they'll have with the main challenge I Wonder you said you do come in anywhere near the Chartwell and I Hope you all have a Hawaii go housekeeping question in Chicago and I Wonder If your line is open Josh actually that you do that in the GMB mix, how it will be a different path.

Thank you John.

My first question is that we see that in our revenue growth is outgrowing our JD DDA. This quarter do we expect that trend to continue in the fourth quarter of next year and also that the revenue mix shift to them, how would that impact our margin outlook in the fourth quarter next year as well and secondly, just a housekeeping question can management share the agenda.

And the <unk> trend in this quarter. Thank you.

Okay.

Okay. So.

The first question. So basically we expect steel to platforms will grow.

Using similar speed in the following quarters or next year. So for the second question about Jamie mix. So.

The broader supervalu categories as comp.

Accounting for close to 50% of the Jimmy amount, while it <unk> account for 40% of the total Jamie amount.

And in terms of the average order value so.

In Q3.

There will be years like.

100 and.

Oh, sorry.

250 RMB.

This is the update for Q3 thank.

Thank you.

Yeah.

Hey, gateway it come to the end of our Q&A session I'll now hand, it back to MS. Caroline Dong for closing remarks.

Thank you operator in closing on behalf of that as a management team we would like to thank you for the physician participation in today's call. If you require any further information please feel free to reach out for US directly. Thank you for joining US today. This concludes the call.

That does conclude our conference for today. Thank you for participating you may now disconnect.

Yeah.

Okay.

Yeah.

Yes.

Okay.

Okay.

[noise].

Okay.

[noise].

Good morning, ladies and gentlemen, and thank you for standing by for <unk> third quarter 2023 earnings Conference call.

At this time all participants are in a listen only mode.

After the management's prepared remarks, there'll be a question and answer session.

As a reminder, today's conference is being recorded.

I will now turn the meeting over to your host for today's call Ms. Caroline Dong head of Investor Relations for data. Please proceed Caroline.

Thank you operator, Hello, everyone and thank you for joining our third quarter 2023 earnings conference call on the call today from data, we have Mr. Jack <unk>, President and Mr. Chen CFO.

Mr. Hoh will talk about our operations and company highlights then Mr. Chen will discuss the financials and guidance.

Please carefully know that during the Q&A session. Jennifer will answer your question in Chinese and then consecutive translation will be provided.

In case of any discrepancy can be operational remarks, and the release and the translated version statements as they are regional remarks should prevail.

Before we begin I'd like to remind you that this conference call contains forward looking statements. Please refer to our latest the safe Harbor statement in the earnings press release, our IR website, which applies to this call.

Also during this call we will discuss certain non-GAAP financial measures. Please also refer to our earnings press release, which contains a reconciliation of non-GAAP measures to comparable GAAP measures.

Finally, please note that all lines otherwise stated all figures mentioned during this conference call are in RMB.

It is now my pleasure to introduce our president Mr.

Her Jeff. Please go ahead.

Thank you Gary and thank you all for joining us today.

That's correct.

So I can see that our global sustain this new patch with top line growth and modest gains.

Gains in operating efficiency.

Our total revenues increased by 20%.

And adjusted net margin improved by.

One one percentage points, yes.

Yeah.

I'll, let begin todays presentation includes updated.

Cooperation with JD com.

And our performance to the tablet.

The shopping basket.

What are the operating highlights for our two platforms.

I will definitely go to back yeah.

Take you through our detailed financial results.

Chris.

Yes.

Got it all set.

Dot com.

In October.

Got that drop in the turbine dotcom habit.

And on demand at the <unk> conference.

And that capital is within reach.

<unk> with Samsung.

And we had to affect year accident claims in both fuel consumption enabled of pellets and accreted jobs.

Particularly in the next five years.

That is easier in the back on all improved facilitated on demand at a test consumption.

Or once again and do it all.

With our ecosystem partners.

So all of the digital transformation of more than two move in back end.

Staff.

And accumulatively create or 10 million plus volume opportunities.

This not only demonstrates our strong confidence unit potential of on demand that would tell you that's true.

But also our commitment.

So and in social responsibility.

Turning to come into us with Janssen a base seem to assure these codes.

Yes.

I'd like to provide highlights from the result, our Ww shopping with us too.

What did you do there.

<unk>.

An all time high and.

In the kidney throughout the promotion grew robustly.

With multiple telcos that Justin triple digit growth.

Including new crop.

Mom and baby products.

On foundation and the convenience stores.

For that at all.

Further on the peak day and.

Nice quarter.

Hi, all.

15 million.

And the total auto repair that listed.

200, and median during the promotion period.

With more onto the operational highlights for our two stephane.

Starting with what we do here.

We are leading on demand at the tail platform in China.

In the third quarter.

We continue to strengthen and expand our partnerships with lip palettes and advance.

And to further enhance the.

The bookings in technology innovation.

Having recently Taylor Corporation.

During this quarter.

Continuing to broaden and deepen our cooperation with the pillows.

<unk> moved our product offerings.

Okay.

September.

JBT has on boarded more than 400000 independent stores.

In the silver market, particularly.

We added a more top supermarket tends to our platform.

And how large that was.

Partnerships with Nike.

<unk> also have their top 100.

Supermarket with Tencent in China.

After we launch.

Our Pan European Labor content put a majority of our sugar markets across the country at the end of July.

We saw a lot of an increase.

User engagement.

Evidenced by the improvement in both retention loop.

The purchase frequency among our USS supermarket testing.

We also made progress in our crackers.

<unk>.

Colonial in the stores.

<unk>.

Moving to Germany, Germany is a bank in London.

C stores.

Upon closing more than eight times year on year.

More on the consumer electronics electronics.

Let them carefully.

In the smartphone subsidies tend to hit the DTF participated in the launch of <unk>.

For products for us.

Conceptually yes.

After the iPhone 13 serious was officially launched for sale in September.

Okay.

Yes.

First the two hours.

The increase of about 250 compared with to the SaaS.

IPhone.

14.

Sure.

In addition.

Under our plan, such as Xiaomi and oneplus.

So we're left to close in the third quarter.

For the computer and.

At least.

So quickly.

G&A increased by 60 year on year.

This growth was attributable to.

Our support for new plants.

Within the multifamily loans.

And our efforts to explore that vessel choppiness in animals.

Notably <unk>.

One such as thou.

So I'll turn time.

June is.

So the news came to close soon.

During this quarter.

We also continued to make progress in the home appliance and home furnishing category.

In the home appliance septic politically.

The NPL sale with diversified USO news offerings differentiate <unk>.

Skus and the compatible with please proceed channels.

Our offerings and enhance the experience of one stop to vivo.

On the installation.

In this quarter.

We've established new partnerships with major appliance brands.

Such as hygiene and the summary.

And the newly on boarded.

8000 home appliance stores.

<unk> per phone.

That's a result.

Our home appliance and a chance through the pipe.

70 year on year.

The home furnishing sector, we also saw electric bills.

With <unk>, increasing by nearly three times year on year.

We established new partnerships with clients such as <unk>.

Rebounds fashion.

As human assets saw.

Our offering.

Pension services.

In the apparel category.

We recently signed a new panels with suites and bank of outdoor plants.

Recruiting suite to Cook.

S, whereas under way our plans.

Such as <unk>.

And the home depot.

And to the luggage brands such as <unk>.

In the third quarter.

Of that Taylor capital increase and more than five times year on year.

For the local category.

Yes, I mean more than tripled year on year.

In the third quarter.

Jim.

Continuous effort to improve the supply of core skus.

That's.

Net pickup activity gets processed.

Depending corporation lease lengths.

It is a pioneer and leader in ultra Maxine for clients.

In September.

We officially launched.

Banco <unk>.

And.

Which amps to have more than 10 plants.

So sales of more than 1 billion.

And they establish a benchmark brands with sales.

Sales of more than $10 billion on our platform.

<unk> hundred four.

Our blended panel poor kept is expanding.

Recently, we formed partnerships with leading biotech clients, including maritime and the Yahoo.

Okay.

In the first on demand the retail platform.

Please.

We also established a new partnership with slack for the plans.

So I guess the engine pools.

And the battery plants.

Yes, listen and that yeah.

We also continued to enhance our omnichannel automatically cooperations with plans.

So I think that leads users through multiple channels, both on and off for kidney disease.

Starting in September.

We've kept very kwe's plans, such as credit grew up.

Our mill and the new backing.

Who have phoned in tungsten exposure.

Wow.

<unk> offline campaigns such as Samsung.

Ken can pepsi competitions.

On the final day of the UN <unk> in Shanghai.

Thank you Ursula and muscle.

200000 year on year increase in sales.

58 is increasing in auto.

Okay.

Yes.

I'd like to talk about our technology and have it.

<unk> efforts.

While the pillows.

<unk> operating system and higher growth continues to play an important below.

Improving efficiency.

And our September.

Hi, Bob had been deployed in nearly.

12000 stores.

We recently upgraded the hybrid systems, which are lifestyle store taking.

Function to support additional business with Pseudomonas.

And the multiyear literally counting more efficient so we play to that.

At lease end.

Nick.

Panel at the merchants, who use status updates of function.

Nike My job is well taken.

At Beaumont right.

Four plants.

We further upgraded our mapping technology.

In September we really do expect equal.

The first step through the lower Muscatine.

Lance is on <unk>.

The hotel industry.

We've improved our marketing efficiency.

Repeat dosing class Ultralow Omnichannel data and then sales.

Home health.

I think with our marketing opportunities grew despite gleevec intense our boats.

Consumers' inbound and that they are supplier status.

So as to make marketing campaigns more effective.

That person.

<unk> has been adopted by 10 plants catalysts such as <unk>.

Consumer electronics in the past and awareness.

And are deploying <unk> solutions to manage marketing activities.

So the conversion.

The increase of the pie Paul.

Put simply.

And the average new customer.

<unk> cost at the Christmas day.

37%.

I will now turn to buy them all.

Tenants, maybe local on demand to be your platform.

In the third quarter.

We continue that we extend our stability capacity.

This quarter the actual either on the Dod on our platform increasing more than.

Planting year on year.

Our first step discuss our care.

I'll turn my chance visits.

In the third quarter.

The gross labor of our menu upfront.

On demand to give associates, who can make sense.

And I'll add to that too.

<unk> five year on year.

In particular.

One of them validate U K continued to grow after the fact.

Barbara due to delayed.

In addition.

And the next and then the kids temporary.

We listened and formed a new partnership with less than the tenants.

Such as <unk> and tungsten.

Whereas tencent cooperation with these implants, among all 15 panels.

Well non core SME in the single digits.

Thanks for a wider.

Now to our associates.

<unk>.

The number of SME and the CPUC others fulfilled during the third quarter.

<unk> was up by 40 year on year.

Yeah.

Lastly, an update on BARDA allows autonomous dsos.

We continue to consolidate.

Additionally, at the largest autonomous deavila platform called supermarket in China.

To date.

Scott on us at Panama Danilo open platform.

But for more than two.

200 <unk>.

On demand that you or others.

For supermarkets.

That concludes our operation updates for our two platforms.

To wrap up.

We have to deal with another strong quarter, our financial results.

We started the gross <unk> melanoma and.

The community tend to year on year improvement against our potent none.

Along with that.

Continuous improvement in business performance.

We grew our mobile also creates unique social value.

Therefore, we said.

The <unk> surrounding.

Consumption digitalization and the employment.

Which is in line with our strategy to realize healthy growth.

We now work around the community.

Consistent.

Consistent.

Consumers retailers and brand owners and allowed us.

We will continue to explore this jack in Q2.

September the dependency for shareholders.

I will now pass the call over to Pat to go through our balance.

Actual results.

Thank you.

Okay.

Thanks, Jeff.

Before we go over the numbers just a few housekeeping I haven't seen events, we believe year over year comparisons are the most useful way to judge our performance. Therefore percentage changes I'm going to give will be on a year over year basis, and all figures are U.

Yeah.

Otherwise noted.

The total net revenue in the third quarter increased by 20% to $2 9 billion.

Net revenues from <unk> increased by 29% to $1 1 billion, mainly driven by increases in order volume of interest.

<unk> services to chain machines.

Revenues from <unk> increased by 16% to one eight.

And then mainly due to the increase in G&A, increasing on our marketing services revenue as a result of the increasing promotional activities also contributed to the revenue growth of J D. D J.

Moving over to the expenses side operations and support costs were too high then.

The increase was primarily due to an increase in <unk> cost as a result of increasing order volume for interested your delivery services provided to various chain merchants.

Selling and marketing expenses decreased to two 1 billion, primarily due to decreasing advertising and the marketing expenses and a decrease in incentives.

Given to the DJ consumers.

G&A expenses decreased to 13 9 million as a result of decreased amortization of finished cooperation agreement and the non competes commitments related to the acquisition of J D. D. J E. T 16, which was substantially amortized as of June 32023.

And reduce the share based compensation expenses as well as efficient expense control measures.

R&D expenses decreased to two.

94 million, mainly due to lower.

Personnel cost as we enhance our.

Our operation efficiencies.

non-GAAP net loss attributable to ordinary shareholders of <unk> was.

It was $9 million, a significant improvement compared with the loss of 217 million in the third quarter of 122, non-GAAP net loss margin was <unk>.

3%, improving by 11 percentage points year over year.

As of September 30th tons, you're kind of history, we had $4 4 billion in cash cash equivalents.

<unk> cash and short term investments, achieving an increase as compared with the balance as of the end of 'twenty.

Q.

In terms of the outlook for the first quarter of <unk> history, We expect total revenue to be between street in the industry 3 billion, representing a year over year growth rate of 12%.

Two <unk>.

3%. So this concludes our prepared remarks.

Operator, we are now ready to begin the Q&A session. Thank you.

If you wish to ask a question. Please press star one on your telephone and wait for your name to be announced if you wish to cancel your request. Please press star two.

You're on a speaker phone please pick up the handset to ask a question.

Your first question comes from Robert <unk> with Goldman Sachs. Please go ahead.

Okay. Thank you.

Taking my question and thank you, Jeff Beck and Caroline.

My first question is on how we're seeing that.

Trends of growth.

Singles' day and based on your <unk> guidance, the sequential sorry slower year on year growth.

Do we see what are the drivers of our growth and how should we think about next year.

Along the consumption trends.

Discretionary for on demand products.

And then my second question is on our cooperation with JD.

With the J D.

Rebalancing kind of traffic that 10 billion subsidy program at <unk>.

How it has the cooperation bean and do we do we see any change in the.

J D traffic allocation to ourselves and any updates on the cooperation.

<unk> translate myself, she said Juanita now Royal Yacht <unk> Gaucher.

Strangely that Shin Kong Yap.

Did you pull the trigger.

Tom.

That's why you see it now women in Canada.

The chin.

They don't they are to use your peso and diesel 100 bombing yet day findings.

South America et cetera.

There are those that paint helman granting donut shape.

Oh, no I think the one thing and you bought a put on that you said, how Trump I'll call lumpy.

Great.

Walkman cleansing don't give me a whole.

I'm not completely sure ghansham.

Yeah.

Okay.

Yes.

So to answer the <unk> music.

Chelsea.

<unk> sounds like there's some key to this so I hope I think a few months.

Yeah.

So just on Keystone CIT I saw something with us.

Sure.

Yes.

So it's actually a good place.

Uh huh.

Since we opened the chance anybody that icon.

Cynthia Tulsa power sensitive she made essential amount to shelter future.

You see one.

Right.

Therefore, we will also be able to choose whether to their strategy.

Do you honestly within the subscription Ashish most of which each of them.

We said that.

Thank you for your question Ronald.

Yes.

Give you a brief.

Update on the overall performance of Allocable 11 shopping festival as we all know it's quite long event.

From mid to late October and running all the way through mid November.

On November.

So during the first three weeks of October.

Gross of supermarkets, and consumer electronics categories were on the softer side.

Two factors.

With an increase in optical.

Outdoor and travelling demand affected.

Factset purchasing frequency.

Supermarket tactically to some extent and see.

Demand for some.

Smartphone brands was not as strong as we had expected.

Now, let's see the tick.

She can element canola.

So maybe you could sort of sometime Woodside Tulsa team there.

Tickets on MTS, AUO takes us with South Sudan juices huh.

We have with our resource that took a chihuahua.

Yeah.

That sounds good.

And at the moment.

After all.

During the double 11 shopping festival.

However, we've seen a decent recovery and growth rate is actually off that.

Supermarket's category.

Primarily thanks to our assets and prioritizing value and our customers savings on top of our convenience of one hour delivery that we provide.

Oh, sorry.

Thank you, thank you and our meals at home.

Do you see that flowing through.

To this effect also can move.

It's worth it to get them done.

On the peak day of November 11.

We made a historic.

Thanks Ruth.

Especially we've seen decent growth for the supermarket category.

Well Scott <unk>.

So there are several system actually please would you open.

Once we get to Ricky for surface Huntington.

So it's hanging in there.

We'll then take the.

Sell through Central next issue claims some choppy.

Should you wish every company.

In Q2.

Super Super.

Yeah.

Okay.

Overall, the consumption market is recovering.

Moving into different categories, however, spending and services, including dining and accommodation entertainment and tourism continue to outpace.

The spending and physical goods. In addition, the need for on demand retail is less prominent and outdoors and ambulance foodservice consumption.

We will maintain our debt to the surface ships.

And I think you said century nickel cool curitiba, you'll see quite as much yet.

The overall answer the central.

Do you think about so let's take a look at.

So Lisa I'll hesitate.

Neither of these trends, we will continue to focus on consolidating our strengths on the supply side and optimizing the user experience.

To position ourselves for the increase and <unk> penetration in the long term.

And about which we are highly optimistic.

If you can change our goal Felicia, which are the GT the HHS.

Just wanted a few towards which is a central scenario.

Two essentials without the equal to the total.

It's embedded in the system.

Okay.

<unk> is an update on our cooperation with JD com.

Both J D D J and I don't know continued to strengthen our cooperation with <unk> during the quarter.

We're talking with J D D J.

First we continued to penetrate and if youre in the base with the number of accounts should all users and the third quarter.

Quarter, increasing by close to 40% year over year.

When we got the order on Samsung.

Colleen you said that you'll put into mid February.

Our local funding in order to ship without too much into the Shenzhen.

<unk>.

Now much of Abbvie has chosen <unk> to each on lithium cobalt.

Yes, Jim.

And sometimes the usual times injury.

So that's something that you've kind of cumulative quarter firmly on the path.

Well.

Our traffic growth on J D.

And outpacing our user growth as we gained access to new and viewpoints on the JD App for example.

Lbs feature is now being gradually integrated into 10 billion subsidy.

Flash sales channels, which enables our merchants to generate incremental exposure.

There's also a fundamental shift when did you mention that since essentially on par with MTV auto tends to dilute our kinship.

200, <unk> Johan Sheldon.

Apart from the incremental touch points with gains we are also making progress in the existing.

User interfaces.

So for the search results for example.

J P dot com has been testing.

Prioritize audio products and categories, including fresh produce and heavy and bulky items, so as to enhance user experience while improving efficiency.

I shall start testimonial, one we shouldnt, we can maintain in 'twenty.

<unk>, Okay, I thought I heard you acquire people without which ends up being.

Didn't ship should teach them the density once you couldnt get the T sand.

And in terms of actually backpack.

Previously known as nearby fully intact.

Have refined the page design the data with Daddy's project development team to drive significant <unk> growth at the same time, we are pushing forward.

This increase in conversion rate and <unk>.

What's the capital question.

As you see it both in their <unk>.

To use the solution.

Now I'd like to share some observations and thoughts.

The impact of Jd's changing algorithm.

J D E J platform.

Let me caution ourselves with the opportunity to move the showpiece of TV Youtube assumption.

<unk>.

Hi.

<unk> sampling and the usage.

We achieved another chapter.

Hunting Chaco sandal with Ya Qin sensitivity.

This facility, which is due to the field.

<unk> is a slide that habit.

We believe our assertion our service not only provide JD users with high quality products and faster delivery to offer competitive prices that stem from our retail partners strength and the supply chain.

<unk> is able to provide a better user experience.

And all three dimension itself.

Prices and services.

As a result, we believe that these new traffic allocation mechanism will benefit <unk> growth in the long term.

So that's something that's hunting elephant talk is cheap.

We saw some debt.

Sales were 600 chip.

So listen to them and that's.

It's what you said.

Susan.

How should us advantage in terms of product quality and diversity.

As well as delivery Speediness is self evident.

I would like to elaborate more on the price competitiveness of our assumption as others.

Well first of all let me answer it sounds as Ashish on the podium.

Two utility that's hung down that amendment Luke.

She's going to serve as a caution that because some key developments potential sanctions to how with anthem.

Production too.

So the years of experience and offline retail attain merchants, we are cooperating with usually have already built with strong supply chain capabilities.

<unk> enables <unk> to provide consumers with competitive process.

In particular and put our categories, such as fresh burgers, and heavy and bulky items, where you just mentioned.

Uh huh.

Jean Michel Malek tissue.

To ensure that she felt.

But for the Central Europe cheaply some per CRB system wide that totally switching for Nancy.

<unk> excuse me.

Just wanted to think about that.

Jim.

So that took a year with lung Luca shelters Smriti can we think about <unk>.

In addition, conducting hotel business on top of other existing offline stores require.

Literal incremental rental and personal personnel costs well they tell us.

Given that lower selling expense ratio.

Right.

<unk> room for our retail partners to offer lower prices.

How should our channel and to provide our consumers with a more value for money items.

<unk> was kind of saying there isn't demand cheaply detailed family life.

So that I assumed and social programs.

<unk> <unk>, which is also a powerful lift we do see some of that loosen.

Looking at our operational results.

Yes, J D began to emphasize the pricing factor in March alright exposure among J D sections outs have maintained remarkable growth for example in Q3, the daily average such exposure should.

<unk> supermarket category increased by 50%.

Second one of course, it sounds easyjet shell Sudhakar shoes jockey assumption tempted sushi reaches about essentially so okay.

Okay.

Is that something that's in the Q2 P cell phone.

In addition, the percentage of how a price competitive product.

Got it.

Ah stay to add about 30% during the November 11 shopping festival.

The testimony of the <unk>.

Overall price competitiveness of our talks about products.

Thank you for your question.

Yeah.

Okay.

The next question comes from Thomas Chong with Jefferies. Please go ahead.

Hi, Good morning, Thanks management for taking my questions. My first question is about GTT, Jay you'll be economics.

<unk> Suisse can management share about.

The takeaway and the expense ratio for different items and on that front, how should we think about.

Do the economics, as we go into China and whatnot.

The drivers behind.

And my second question is about.

The all to all opportunities.

In China.

<unk> mentioned in the prepared remarks, the market size is huge but on the other hand, we also see.

The competitive landscape.

It's also quite intense as well so just wanted to get some thoughts from management about how we think about the landscape in China trying to fall.

And on that front.

What is the long term.

That margin that we are expecting.

In.

In the coming years.

Thank you.

So step one in changzhou Shlomo that humans.

The carbon tissue Kuan Yew J D D J D E.

I'm sorry.

Uh huh.

Ben Shim, you'll hold a woman can see me.

T J good economics.

Gotcha.

A light of unsung compound rate.

<unk> ratio that you got guys that are what.

<unk> continues to go hungry.

A woman combo local on demand <unk> Jakafi quietly go based on Eagle Bancorp.

The main guy doing.

Good your project should competition that you've got kind of a pause.

Could you give us some wholesale will be challenging, but you've got direct margin.

I'm sorry, the TPI.

So you can diversify yourself.

Thank you Thomas this is.

Yes, your first question.

Jeff can take the second question so.

Terms of the monetization of J J in Q3.

The monetization rate was increased to 10%.

In Q3, which is the first time, we pass through like the 10% threshold.

Historically.

And at the same time.

In our consumer incentives was.

Further decreased to three 3%.

Which is either like decreasing on a Q on Q basis, our year over year basis.

Pam.

<unk> cost.

Including rider costs packing cost was four 7% which is.

Decrease on year over year.

While increased Jiangsu.

Is it could it be cost seasonality in summer campaign.

Campaign.

And in terms of the.

For example, <unk> and therefore, a major driver of steel we will keep you increased commission on our marketing and manufacturing of rate and then at the same time.

We will further.

Decrease our.

Consumer incentives expenses and also operating costs.

Side to further enhance our.

There are some margin.

On a year over year basis.

And also in terms of the last question. Your second question in terms of the long term margin.

So basically as we have talked about previously so J D J.

Could be.

That netted to two like the traditional E Commerce platform, which is just a localized version so.

In terms of like the appreciating.

Operating profit so I guess, the JV generated through the platform. So we are a marketplace model neutral platform model. So sure be targeted as a 3% as a percentage of <unk> hour.

Our long term operating non-GAAP operating profit for J D J.

Thank you.

Okay.

If we dissect the other places.

Lindsay.

No.

Okay.

And daughter, Lucy endocrinologist in diabetes.

Congrats on the <unk> is in that sense, a hernia there too there financially.

Well. Thank you Jason so yeah, the syndrome crude unless it's we call it out.

Linda.

So I could see that Youll Sidney.

Two quick questions.

Now I'd like to share some thoughts on your second question about the competitive landscape.

That's more leading internet companies are prioritizing.

On the non retail business speaks off its great potential and we believe the industry can easily accommodate different players to grow laboratory and their respective areas of strength.

Cumulative catch IBM saw some gaps where they can achieve shlomo so you'll see units within this group.

With this is that the EU in Taiwan that we need to see students with some simple with the fulfillment.

But should that same timeline on chicken reduce impact.

So it sounds healthy manner.

So what I mean.

By changing that sends out that's a message.

Especially with <unk> about bringing the total neutral zone.

And to your question.

If we could squeeze your assortments issue introduce who don't quarter Q2.

J D D J, firstly, our strengths and it.

<unk> partnership with pay merchants remains rock solid.

This is a result of our positioning.

And open and neutral platform as well as our accumulated know how and expertise and empower and retailers.

Various systems and services.

Mentions ecosystem with no. It is hard to replicate and short time other platforms.

And supermarket category, we've on boarded 93 out of the top 100 tanks in China.

In addition in categories, such as smartphones and mom and baby.

We've also teamed up with most of the leading chain retailers in China.

This abundance of high quality supply is the basis for us to continuously attract and retain users.

Additional new two new ships with simple Timna, we don't put that for me.

So if we don't find them mature.

I'm not.

She says to us is that Susan.

<unk> for the future.

So.

Whichever nutrition, which agenda video Kimpton ICU shanda.

The $80 million for 10 months, you will meet that goal with future.

Okay.

So if there's something to announce things when it comes out of the yard Shaw.

Interim chunky chunky millions of ports on our tissue.

So this can be done.

DSO in the townships of Genpact limited, so that $2 million.

Simponi is about changing that.

Secondly, we enjoy huge potential and penetrating more of Jd's gives us.

Currently internet companies are focusing on cultivating the mindset for on demand retail among our own user base.

Which means limited head on competition among one another.

<unk> users.

Here in fleet purposeful shop has put them on higher merchandise quality and the delivery speed I believe its more efficient for us to convert them into on demand retail consumers and we remain confident in.

In penetrating 50% of the J D user base in the long run.

That's the one that says when something like this with some.

Nutrisystem Couto assumes in terms of where you need it.

So Shannon tongue secrets issue the tender.

Johann look which is really a key focus within Saudi <unk> consulting send them to me.

J J you lose if you take what's your sense of <unk>.

Turkey renewed.

Poussaint tuition two kimpton sandeep, so I think all the Credentialing Brooklyn cognizant when injunctions is unsure what use of cheaper under you knew that need it.

And thirdly on top.

Market share gains, we value with sustainable growth by balancing growth and profitability.

So a combination of efforts in optimizing subsidies.

<unk> delivery efficiency and increasing online marketing monetization.

Profitability of J D. D. J has improved significantly in the past few quarters to near breakeven.

In the long run we also believe that <unk> has higher profitability potential compared with other players tests.

Our significantly higher <unk> and online marketing monetization rate.

Thank you.

Kidding.

Thank you.

Okay sure.

Yeah.

Your next question comes from Alicia Yap with Citi. Please go ahead.

Hi.

Josh I'll hop by any chance you could give some of the key one.

<unk> printing is Oh go ahead, Phil about people sure sure you find that Shan Shan Shan key to US is how should you think Oh God.

<unk> took a sheet sure that you've got.

Shawn Lockman sushi gain that you see.

Do you see.

Now what's that telling you that there's room for all qualifying Shuja Hall, So got how sure Glenn Phase how should you think <unk> made a huge show El Nino.

You see I mean, we definitely want to go city, you got like Nokia Goldman Keno Hill.

When you calculate your T shirts at the end of time, but when kind of thoughts about Q2 tissues ship share.

It sounds like a pushout, so uhm ammonia <unk> songs yard or you can shoot Shaw.

No just like she saw that Shan Shan Shan English T. J C. No from a constancy to England to shelf, what I'll I'll check <unk> check out T. So that's I'm not sure.

Paul.

Thanks for taking my questions. My first question is a follow up on our management comment regarding the supermarket and the electronics category before to think I spent the first three weeks of October and then single stage rebounds, and so just wondering what is the demand trend.

Oh single state that you're expecting for supermarket and non supermarket category and then second question is on the cost of riders.

So can I understand the increase in the cost of writers is related to these intra city delivery is at and heating related depending on the type of the chain merchants that you're servicing and which specific.

Order demand during this <unk> that resulted in the higher rider cost do we expect a higher rate of cost into <unk> given it is a promotional season and potentially coda later thank you.

Thank you Alicia so lesser academia gesture.

Two questions. So for the first question. So it's just like the weekend. So we finish like the <unk>.

Campaigns, so still there isn't it.

I don't think there is enough time for us to evaluate like that just three days.

Daily sales to give you some color or comment for the post pandemic campaigns trained.

In terms of the second question. So about the right account. So in terms of the absolute dollar amount of the rider costs, Yes, it's increase either on Q on Q level or year over year cost overall and is still growing and robust today, especially our.

And I know this is growing by 29%, but within which allow.

Our accounts.

It's growing by five percentage.

We have discussed before so.

So this is just the cost overall and yes, it's growing in terms of like the.

The unit cost at <unk>.

The order level.

Jimmy level basically.

<unk>.

Efficient and safe.

On a year over year basis and.

In Q3, basically because usually it's the summer.

Season, so it takes more to recruit and retain riders compared to spring time or not.

The autumn season.

So in Q4, we believe on a year over year basis, our price.

Union costs.

For the riders will decrease on a year over year basis.

Okay. Thank you you bet.

The next question comes from Lei, Zhang with Bank of America.

Please go ahead.

Hi, Glenn.

That's all hospices, there's all of that.

Our Eagle one pieces outweighs, yeah, all woman kitchen, and gorgeous about let's say the Manhattan Chunky thought Oh, it's all quite Oh, taking chico's quantifiable at all my French Guiana, South now Oh God go and she says don't change outside of just say hang out mccloskey, yeah completely I cannot go check out ship almost Xiang Guan.

Oh sure Jay something funny, because they thought that woman that's something that supports a more should go up at yourself off on me and they say Oh Gee, that's not buyback on the banking side.

For taking my question My first question.

Regarding the impact from our pro worse, a little word of threshold awful, but spread the leeway to RMB.

That's K nine in Q3 and that can you share more color all day.

Did I notice that that we have just put out some nice semi related pay that number doing double the allowance. Okay. You gave us all a malls.

Most of all on your momentum regarding lifesaving rolled out thank you.

Got that.

In our Windows 10 users.

This is Jim.

Linda keep himself will guide us to the Tulsa excuse me.

To conclude that Houston.

Poussaint could end up at 602.

TTM equivalent to bias.

Also convincing people to.

And bent on Friday advantage here.

Awesome.

So there's nothing there.

With that said its immediate Houston is about.

Put under undue sounded good.

Thank you for question.

Since the end of July delivery fee waiver campaign.

As covered basically almost supermarket orders.

And after that we found.

Post conversion rates and repeat purchase rates increased.

<unk> remained largely stable.

Specifically and August comparator with July the overall conversion rate of our supermarkets category improved by over 10% and then <unk>.

<unk> retention rate also increased by over 10%.

It will be was substantially unchanged.

Do you think to torment him about that whole suite that G&A to the central let's say.

<unk> Castle.

So I think China Chinese Mega chances for more clinical work with the tungsten that's useful.

And therefore, thanks to the initiative.

Your growth.

Of.

Dnb in the supermarket category accelerated in the third quarter of 2093 compared with <unk>.

Second quarter.

And the program will be a long term initiative to improve user experience.

So we didn't turn into the tenure so European to have its own gas into some bank institutions without debit CGM multilingual shelf without vishal.

And in terms of their P&L impact since the cost of delivery fee waiver, it's shared by us and our merchant partners the impact on the direct margin of J D D J.

And it doesn't sound skips and manageable for us.

The support from <unk>.

The important thing she said that there's a huge shift.

So some of what she does is it something you know about that shaping how soot sensing Chaplin tend to look at some of the hurricane type settlement.

So I can most impact types with a focus on Super Con sequel.

Ago.

This will remain so.

No.

When you hit that asos, so soon about that too.

Hum.

This is the truth of the shelf.

While proven silicon Glen It's we'll talk about that one.

<unk>.

So also a second question about large streaming yes, we've taken out the rising popularity of live streaming during the singles day promotion that just ended.

D D J launched multiple live streaming events, together with merchants and brands and categories, including supermarkets consumer electronics and home appliances.

This was the first time.

That's our frontline professional teams engaged with three tenants are engaging with consumers to offer them value for money products deliverable within one hour and we did see initial results with <unk>.

Some sessions, attracting total views exceeding $1 million.

Total CMV transacted via live streaming more than tenfold versus June 18th promotion.

I think thats the cost of about 4 million.

At that time.

Our core yields in the <unk>, what you see.

For the second half of the geography.

Associated with Hurricane Matthew the feasibility of that.

With that element to your question.

It sounds I think Toyota tundra.

Tim Poole Tibor.

If we can continue that sells tobacco with GM.

Overall, we are still in exploration stage for the live streaming business, we plan to further optimize the process and enhanced our product capability.

Integrate lbs with live streaming.

In the future. We are also going to encourage local merchants on our platform to host regular live streaming session. So as to provide our users with more immersive on demand shopping experience.

Thanks for your question.

Okay.

The next question comes from Wayne Zhong with UBS. Please go ahead.

Hey, Glenn somehow Hawkeye he's doing all the team at National Shan Shan Shan is always that you were saying that you do gentlemen, Doug I'm not sure what else we should be doing all got quieter months I'm not sure if I'll use teaching a tissue as I said to her ammonia, which you should not put horizontal chowchilla sure Thiago that they'll have with somebody and Johns commentary you said you do come in anywhere near the Chartwell now holds.

I have a housekeeping question on Chicago and amongst your line is open Josh actually that you do that in the G. M D mix, how it'll be a different path.

Thank you John.

My first question is that we see that in our revenue growth is outgrowing our JD DDA. This quarter do we expect that trend to continue in the fourth quarter of next year and also that the revenue mix shift how would that impact our margin outlook in the fourth quarter next year as well and secondly, just a housekeeping question can management share the gender mix in.

Oh the trend in this quarter. Thank you.

Okay.

Okay. So.

About the first question. So basically we expect still a few platforms will grow.

Using similar speed in the following quarters or next year. So for the second question about Jamie mix. So.

The broader supertanker categories, it's comp.

Are you accounting for close to 50% of the Jimmy amount, while it <unk> account for 40% of the total Virginia Mt.

And in terms of the average order value so.

In Q3.

It will be years like.

100 and.

So it's two.

150 RMB.

This is the update for Q3, thank you.

Yeah.

Hey, gateways come to the end of our Q&A session I'll now hand, it back to MS. Caroline Dong for closing remarks.

Thank you operator in closing on behalf of that as a management team we would like to thank you for the physician participation in today's call.

Any further information please feel free to reach out for US directly. Thank you for joining US today. This concludes the call.

That does conclude our conference for today. Thank you for participating you may now disconnect.