Dada Nexus Limited

Good morning, ladies and gentlemen, and thank you for standing by for DADA's second quarter 2023 earnings conference call. At this time, all participants are in listen-only mode. After the management's prepared remarks, there will be a question and answer session. As a reminder, today's conference call 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 DADA. Please proceed, Caroline.

Thank you, operator. Hello, everyone, and thank you for joining our second quarter 2023 earnings conference call. On the call today from data, we have Mr. Jack Hu, president, and Mr. Back Chen, CFO. Mr. Hu will talk about our operations in the company highlights. Then Mr. Chen will discuss the financials and guidance. Please kindly note that during the Q&A session, Jeff will answer questions in Chinese and the consecutive translation will be provided. In case of any discrepancy between the original remarks and the translated version, statements in the original remarks should prevail. Before we begin, I'd like to remind you that this conference call contains working statements. Please refer to our latest Steve Harper statement in the earnings press list on our IR website which applies to this call. Also, during this call, we will discuss some non-GAAP financial measures. Please also refer to our earnings press list, which contains a reconciliation of non-GAAP measures to the comparable GAAP measures. Finally, please note that, unlike otherwise stated, all figures mentioned during this conference call are in RMB. It is now my pleasure to introduce our President, Mr. He. Jeff, please go ahead.

Thank you, Karen, and thank you all for joining us today. In the second quarter of 2023, Dada Group continued to deliver strong level growth with significant increase in our operational efficiency. Our total net level increased by 23 year-over-year. We also achieved an important milestone in this quarter. by recording our first positive adjusted net income, thanks to a more than 17 percentage points improvement in our adjusted net margin. I will begin today's presentation by discussing our cooperation with JD.com, followed by operational highlights for our two platforms. I will then hand over to Bec We will take you through our detailed financial results. Let's start with some updates on Dada's co-operation with JD.com. With changing our branding awareness among JD.com users, we recently unified the display of our on-demand retail services across all touch points on JD app. In Chinese and the shop now, In particular, the Nearby All Fujian tab was renamed Xiaoshida, and the Xiaoshida tag has been added to search results for products offered by our merchant partners. This unified brand emphasized our ability to deliver products within one hour. And we believe it will significantly enhance auto mindshare among JD users. At the same time, we also want to enhance JD DJ's offerings by attractive prices. We met with JD's everyday low price strategy. In this quarter, we utilized the price-based star rating tool and worked with merchants further improved the price compatibilities of Xiaoshida products. So far, we have achieved a 10 percentage point increase in the proportion of HiStar products was March. For the Xiaoshida tab, which was previously known as nearby or tab, more than called G-Pod Year-on-Year. This impressive growth was driven by exposure and quick-through optimization, which helped the Xiaoshi data of WDAU, as well as improvement in convention rate and average basket value. Let's move on to the operational highlights for our two platforms. Start with JDDJ. China's leading on-demand tele-platform. In the second quarter, JDDJ made further progress in the tele- and the brand collaborations and the technology empowerment. We continue to broaden and deepen collaborations with the telers to enrich our product offerings during this quarter. JDDJ cooperated with more than 300,000 annual active retail stores at the end of June 2023. In the supermarket category, based on the list of top 100 supermarket chains in China released by CCFA in June, we now have established partnerships with 92 out of the top 100 super market trends. In June, together with the super market merchants, JDDJ launched a delivery fee waiver campaign in 10 key cities to improve our user experience. During the campaign, these cities saw a 34 percentage point higher user growth rate and a 2% percentage point higher, 15-day repeated purchase rate. There are other cities. During the entire June drought, we have now rolled out delivery rate benefit to major supermarket chains across the country. We have always focused on helping the chains achieve better efficiency through platform tools. such as long lasting specific membership features. But a low chance to attract and manage their own members online. The function notably increased the sales efficiency. With all the conversion data of members, more than 20 percentage point higher than data of non-members. Among the chains that have adopted the membership tool, members already contributed 60% of their total GME in June. In addition to large supermarket chains, we have also made inroads with major convenient store chains. We further strengthened our collaboration with JT convenient store. while forming new partnerships with USMILE and other leading chains. Total GME generated by convenience stores grew by nearby three times year-on-year in the second quarter. We also made good progress in consumer electronics category during the quarter. In the smartphone subcategory, driven by faster delivery on top of its active pricing in the second quarter. The GME or Apple products on our platform grew steadily, while Android brands, such as Xiaomi, continued to see GME grow several times on a year-on-year basis. In the computer and accelerators category, GM increased by more than 17 year-on-year. And the brands such as Xiaotiancai, Kedaxingzui, and Dajang all achieved significant growth. Moving next to the home appliance and finishing category, which left out quickly, the home appliance subcategory maintain the laptop close, nearly double GM year-on-year. We continue to enrich our offerings of air conditioners and other major home appliances. And we established partnerships with kitchen appliance brands, such as Funtime. The home furnishing subcategory also grew rapidly. with GMO increasing more than four-fold year-on-year. In particular, we are seeing significant growth in the sales of electronic lock products. Thanks to the wide range of machines on our platform and our ability to offer high quality deliver and registration services within four hours. In addition, We set up new partnerships with sanitary fixture brands such as Kele and whole textile brands such as Fuana. We also continued to expand our offerings in liquid category, onboarding more than 5,000 new stores during this quarter. As a result, CME increased more than four times year-on-year. Next, let's move on to JDDV's efforts to expand and deepen cooperation with brands. In the second quarter, we embarked on new partnerships with rice and cooking oil brands, such as Shiye Daotian. mom-and-baby brands such as Dawang, Jinyalku. We currently have auto marketing partners with about 300 leading domestic and international brands. In terms of branding campaigns, we continue to do deep-end collaboration with brands to promote omni-channel auto marketing. Help brands reach users through multiple channels, both on and off JDDJ. For example, in early May, we collaborated with to launch the brand on campus campaign to promote these new products, which more than 70 percent month-on-month increase in GDS sales on JDTJ. In addition, through the collaboration with JD.com, we have further optimized the process by which we cooperate with brands on exchanging and advertising the source. At present, we have conducted the source exchange with more than 20 brands including , achieving win-win for both sides. Next, I'd like to talk about our efforts to empower both retailers and the brands through technology innovation. As of the end of June, Kaibo, Our omni-channel outdoor operating system for retailers has been deployed in about 11,000 stores across more than 300 retailer chains. In the second quarter, we launched the consumer reviews a system that functions in the hybrid system, which enables merchants to automatically reply to consumer reviews across multiple channels and provides anonymous review tracking, store maintenance, monitoring, and other functions. This capability empowers merchants to provide efficient customer services and to improve user experience. Machines using this feature can generate automated replies to all positive and negative reviews, which gain 60% higher efficiency at handling less favorable ones. Haribo also began to explore collaboration with brands. We recently launched a series of brand promotion tool on the hybrid system to help brands conduct marketing and promotions on the channels, thereby helping branding improve exposure and connection. I will now turn to Dada Lao, China's leading local on-demand delivery platform. In the second quarter, Dalai Lama continued to provide a massive amount of flexible working opportunities, with quarterly active riders increased by over 30 over the year. In terms of business progress, let's start with our K or Champa Champs business. In the second quarter, our annual flow on Demanded Real Services took a chance, increased by more than 20 year-on-year. Thanks to increased order density and sufficient delight of suppliers, our average gross profit per order improved significantly to $0.50 a month Meanwhile, our fulfillment rate increased to 98%. Thanks to our optimized provider fleet structure and the operations. In the supermarket care category, money increased nearly 20 year-on-year. We recently established a new partnership with Fresh First of all, and other supermarket chains. In the category, we continue to increase the penetration in our store. For the 20th quarter, we maintain the year-on-year of more than 100 We also recently formed a new partnership with David Chance. Regarding our co-operations with Douyin local life services, we continue to actively support the national-wide rollout of Douyin's food delivery business by providing cost-efficient and reliable on-demand delivery services across the nation. Moving to our SME and C2C business, the number of SME and C2C areas fulfilled in the second quarter increased by 50 year-on-year. This growth was drawn by our continued penetration into low-tire cities and our expansion into additional traffic acquisition channels and business centers. Lastly, an update on our mastermind sources. In the second quarter, we maintained a steady growth in the number of preferred orders despite the higher base in the year-ago period. Our operations are based for the two platforms. We continue to post strong financial results highlighted about our first-ever positive adjustment net incomes. At the same time, we stay committed to drive the digitalization of retailers and brands, bring great on-demand shopping experience to consumers, and providing flexible employment opportunities to riders. We will seek to build on this maintained in the quarter ahead as we work to create substantial values for our shareholders. I will now pass the call to Doug to go through our financials. Thank you.