Dada Nexus Ltd (DADA) Q3 2024 Earnings Call Highlights: Strong Growth in Dada NOW and Strategic ...

GuruFocus News
4 min read

In This Article:

  • Total Net Revenues: RMB2.4 billion in the third quarter.

  • JD NOW Net Revenues: RMB930 million in the third quarter.

  • Dada NOW Net Revenues: Increased by 39% year on year to RMB1.5 billion in the third quarter.

  • Non-GAAP Net Loss: RMB59 million in the third quarter.

  • Non-GAAP Net Loss Margin: 2.4%, narrowing by 3.7 percentage points sequentially.

  • Operations and Support Costs: RMB1.7 billion in the third quarter.

  • Selling and Marketing Expenses: Decreased to RMB717 million.

  • General and Administrative Expenses: RMB108 million.

  • Research and Development Expenses: RMB90 million.

  • Number of Orders Delivered by Dada NOW: Increased by 36% year on year to 648 million.

  • Gross Billings of Dada NOW: Grew by 33% year on year to RMB3.10 billion.

  • Number of Operating Stores: Increased by over 70% year on year to more than 600,000 stores.

Release Date: November 14, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

  • JD NOW experienced over 100% year-on-year growth in monthly transacting users and orders through the JD App.

  • Dada NOW's net revenues increased by 39% year-on-year to RMB1.5 billion, driven by strengthened partnerships with chain merchants.

  • Non-GAAP net loss margin narrowed by 3.7 percentage points compared to the previous quarter, indicating improved cost efficiency.

  • The number of operating stores increased by over 70% year-on-year to more than 600,000 stores, enhancing product offerings.

  • Average fulfillment time for JD NOW orders was shortened by more than 20% year-over-year, improving delivery efficiency.

Negative Points

  • Net revenues from JD NOW were impacted by a decrease in online advertising and marketing services revenues.

  • Operations and support costs increased to RMB1.7 billion, primarily due to higher rider costs.

  • General and administrative expenses rose due to an increase in provision for credit loss and litigation-related expenses.

  • Selling and marketing expenses decreased, reflecting reduced promotional activities on the JD NOW platform.

  • Despite narrowing, the company still reported a non-GAAP net loss of RMB59 million for the quarter.

Q & A Highlights

Q: How do you see the recent government support policies and consumer sentiment trends affecting the on-demand retail business? A: Jun Mao, CFO: We believe boosting consumer confidence is crucial for China's economic growth. The on-demand retail sector is one of the fastest-growing subsectors. We see significant room for JD NOW's penetration among JD users. Our integration with the JD ecosystem offers substantial upside, and we are committed to enriching high-quality supply across various categories. The synergies between JD NOW and Dada NOW platforms enhance our competitive edge, improving delivery efficiency and service quality.

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