Release Date: August 21, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Dada Nexus Ltd (DADA, Financial) reported over 100% year-on-year growth in monthly transacting users and orders through the JD app for JD NOW.
- Revenue growth for Dada Now exceeded 50% year over year in the first half of 2024.
- Non-GAAP net loss margin narrowed sequentially in the second quarter, improving by RMB53 million.
- The number of orders delivered by Dada Now in the second quarter rose 21% year on year to 679 million.
- Dada Now's net revenues increased by 47% year on year to RMB1.4 billion in the second quarter.
Negative Points
- Net revenues from JD NOW decreased due to a decrease in online advertising and marketing services revenues.
- Selling and marketing expenses decreased to RMB782 million, indicating a reduction in promotional activities.
- General and administrative expenses decreased to RMB48 million due to a decrease in amortization of intangible assets.
- Research and development expenses decreased to RMB85 million, mainly attributable to a decrease in research and development personnel costs.
- The company faced challenges in overall GMV and revenue growth in the short term due to business streamlining and adjustments.
Q & A Highlights
Q: Can management update about the trend in recent months regarding consumer sentiment and the competitive landscape? Also, what are the business trends for JD NOW and Dada Now in the second half?
A: Consumer confidence and willingness to spend have shown continuous and stable recovery. JD NOW has maintained rapid growth in GMV and user base within the JD channel. The competitive edge lies in the richness of offerings and integration with JD.com. Dada Now has significant advantages in network coverage and delivery costs, ensuring above-industry growth rates in the long run.
Q: Can management share insights on user consumption patterns for JD NOW, particularly in FMCG versus non-FMCG categories? Are there any pressures on the take rate across different categories?
A: The supermarket category is more mature and stable, while non-supermarket categories like flowers and beverages have seen higher growth rates due to rising on-demand retail penetration. Emerging categories registered rapid growth in the second quarter, driven by supply expansion and marketing campaigns.
Q: What is the financial guidance for Dada Now and JD NOW, considering the higher growth of Dada Now and potential pressures on JD NOW?
A: JD NOW's GMV and revenue growth faced short-term challenges due to business adjustments but showed promising results in user base and order volume growth on the JD app. Dada Now continues to gain market share with strong momentum in restaurant and beverage KAs. Management prioritizes user and order volume growth, focusing on penetrating more JD users and enhancing their mindshare.
Q: Can you provide more details on the cooperation with JD.com and the goals for user penetration?
A: The JD NOW section on the JD app's homepage has shown significant results in user penetration and cultivating consumer habits. The average daily paying users of the JD NOW section approached 10% of overall JD NOW users, with a 30-day repurchase rate exceeding 60%. The geographical coverage of the JD NOW section has been expanded nationwide.
Q: Are there any changes to the company strategy following the recent management change?
A: The strategy remains unchanged. JD NOW continues to focus on providing users with quality merchandise and instant delivery, leading the on-demand retail industry. Dada Now prioritizes providing stable and efficient on-demand delivery services, with a focus on restaurant and beverage KAs.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
