Vipshop Holdings Limited

Ladies and gentlemen, good day, everyone, and welcome to VIP Shop Holdings Limited's third quarter 2021 earnings conference call. At this time, I would like to turn the call to Ms. Jessie Zhang, VIP Shop Head of Investor Relations. Please proceed.

Thank you, Operator. Hello, everyone, and thank you for joining VIP Shop's third quarter 2021 earnings conference call. With us today are Eric Chen, our co-founder, chairman, and CEO, and David Tsui, our CFO. Before management begins their prepared remarks, I would like to remind you that the discussion today will contain forward-looking statements made under the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from our current expectations. Potential risks and uncertainties include but are not limited to those outlined in our safe harbor statements in our earnings release and public filing with the Securities and Exchange Commission, which also applies to this call to the extent any forward-looking statements may be made. Please note that certain financial measures used on this call, such as non-GAAP operating income, non-GAAP net income, and non-GAAP net income per ADS, are not presented in accordance with U.S. GAAP. Please refer to our earnings release for details relating to the reconciliation of our non-GAAP measures to GAAP measures. With that, I would now like to turn the call over to Mr. Eric Shen.

Good morning and good evening, everyone. Welcome and thank you for joining our third quarter 2021 earnings conference call. During the third quarter, our business demonstrated resilience despite macro headwind and the general weakness in the retail industry. We continued our efforts to execute on our merchandising strategy while refining our operations. Everything we do as a business is intended to strengthen our core competence for long-term growth. As a result, key operational metrics, including our overall user base, GMV, and our pool achieved year-over-year growth. Specifically, total active customers increased to 43.9 million and the total GMV grew by 5% to RMB 40.2 billion. Our most valuable customer group continued its strong momentum during the quarter. Super VIP members grew over 40% year-over-year and contributed more than one-third of our total GMB. In the third quarter, We focus on strengthening our position and value proposition as a leading discount retailer among our brand partners and customers. In line with this goal, we prioritize co-brands to better match traffic and resourcing for them and optimize our customers' operations, especially for high-value customers, including our super VIP members. We are happy to see some encouraging results from these initiatives. For example, during the Super Brand Day sales event in the quarter, multiple brands recorded higher than expected sales, with a few even hitting their highest single-day GMV in recent years. These brand partners are increasingly aware that VIP Shop remains a reliable platform for them to increase sales efficiency. As this perception is strengthened, more brands are effectively motivated to maintain a closer relationship with us and supply VIP Shop with a great variety of unique and pricey competitive products. This was further evidenced in the past culture by the solid increase in the number of SPUs and the value of merchandising, as well as improving quality of branded products available on our platform. Moving to the custom side, in the third culture, we will more integrate in our approach to managing our existing and potential customers. We are committed to driving new customers' growth but are now doing this in a more efficient and effective way. We have put great emphasis on recapturing inactive customers and more importantly, become better engaged with our super VIP members. We have seen rapid growth in our number of super VIP members who compare to regular customers and are significantly more resilient in terms of consumption, boast higher retention rate, and generate higher output. Through these consistent and sustained effects, we aim to increase our competitiveness in China's discount retail market. Going forward, we will create more business synergy by empowering our co-brand partners and optimize user experience to drive the solid quality and sustainable growth of our business. At this point, let me hand over the call to our CFO, David Cui, who will go over our financial results.