Ronald Keung

Ronald Keung from Goldman Sachs inquired about Vipshop's quarter-to-date business performance, specifically how the late Spring Festival and seasonality impacted Q4 sales and the observed recovery in Q1. He also sought clarity on the margin outlook for 2026, considering 2025's margin pressure, new investment plans, and expectations for gross and net profit margin stabilization.

Answer

Jessie Zheng, Head of Investor Relations, explained that Q4 sales, particularly in December, were impacted by unusually warm weather affecting winter apparel demand and delayed holiday shopping due to a late Spring Festival. She noted a clear pickup in consumer activity in January and February, aligning with the Q1 guidance of 0-5% top-line growth. Regarding margins, management emphasized a consistent philosophy of high-quality, sustainable, profitable growth, expecting margins to remain stable and aiming for outperformance in 2026 and beyond.

Ronald Keung from Goldman Sachs inquired about Vipshop's quarter-to-date business performance, specifically the impact of seasonality and a late Spring Festival on sales, and the outlook for revenue acceleration. He also asked about the 2026 margin outlook, considering 2025's pressure on gross and net profit margins, and potential new investments.

Answer

Jessie Zheng, Head of Investor Relations, explained that Q4 sales, particularly in December, were impacted by unusually warm weather affecting winter apparel demand and delayed holiday shopping due to a late Chinese New Year. She noted a recovery in consumer activity in January and February, supporting the Q1 2026 revenue guidance of 0-5% growth. Regarding margins, Jessie Zheng stated that Vipshop remains focused on high-quality, sustainable, profitable growth, expecting margins to stabilize and aiming to outperform in 2026 and beyond.

Ronald Keung of Goldman Sachs questioned the drivers behind the record-high Q3 gross margin, the outlook for Q4 gross margins, and the reason for the increase in tax expenses that led to a wider profit decline.

Answer

CEO Eric Shen stated that the Q4 gross margin is expected to be marginally lower than Q3 but within the 23% range, as the company invests for growth. CFO Mark Wang added that Q3's margin expansion was driven by a higher contribution from apparel, cost-saving initiatives, and higher-margin other revenues like Shan Shan Outlets. Wang explained the higher tax expense was due to a RMB 175 million withholding tax on a RMB 3.5 billion dividend distribution from mainland China to Hong Kong to fund share buybacks. He noted the long-term effective tax rate should normalize around 17-18%.

Ronald Keung at Goldman Sachs asked about the CapEx outlook for the next three years, specifically in relation to the previously mentioned RMB 380 billion figure, and the correlation between CapEx and expected incremental revenue.

Answer

CEO Eddie Wu indicated that the RMB 380 billion CapEx plan might be insufficient, as current AI customer demand is outpacing the pace of new server deployment, and he would not rule out further scaling up investments, dependent on supply chain availability. Regarding the CapEx-revenue correlation, he stated it's not yet possible to make a stable estimate due to the early stage of AI development and the diverse uses of AI infrastructure, which yield varying revenues and gross margins. He emphasized focusing on serving high-quality tokens and cost-effectiveness long-term.

Ronald Keung at Goldman Sachs asked about the CapEx outlook for the next three years, specifically in relation to the previously mentioned RMB 380 billion figure, and the correlation between CapEx and expected incremental revenue.

Answer

CEO Eddie Wu indicated that the RMB 380 billion CapEx plan might be insufficient, as current AI customer demand is outpacing the pace of new server deployment, and he would not rule out further scaling up investments, dependent on supply chain availability. Regarding the CapEx-revenue correlation, he stated it's not yet possible to make a stable estimate due to the early stage of AI development and the diverse uses of AI infrastructure, which yield varying revenues and gross margins. He emphasized focusing on serving high-quality tokens and cost-effectiveness long-term.

Ronald Keung asked for more detail on Alibaba Cloud's growth trajectory, specifically whether the growth rate accelerated on a month-over-month basis after the Spring Festival due to a surge in inference workloads. He also questioned how the mix of small and large AI models in the Qwen family impacts the demand for cloud compute power.

Answer

CEO Yongming (Eddie) Wu clarified that while the first quarter's results were impacted by the Spring Festival, the surge in demand seen in April and May, particularly for inference workloads, is more representative of the regular growth pace going forward. He explained that smaller edge models are complementary to the cloud business, fostering ecosystem reliance, while larger models directly drive cloud usage due to their need for scalable and cost-effective compute power.

Ronald Keung questioned the growth trajectory of Alibaba Cloud, asking for details on the month-over-month acceleration in demand for inference workloads following the Spring Festival. He also inquired about how the company evaluates the impact of its different-sized AI models (large vs. small) on driving cloud compute demand.

Answer

CEO Yongming Wu stated that while the first quarter's results were impacted by the Spring Festival, demand surged afterward, particularly for inference workloads, setting a pace more representative of future growth. He explained that smaller, edge-based models are complementary to the cloud business; customers using the Qwen model family often require cloud-based compute for larger models and more complex tasks, which drives business to Alibaba Cloud and creates higher customer reliance on its products.

Ronald Keung inquired about the stabilization of the e-commerce take rate, the adoption progress of the Shenzhen T marketing tool, and whether this implies the gap between CMR growth and GMV growth has closed.

Answer

Executive Toby Xu confirmed the take rate has stabilized due to a balance of factors. Positive drivers include the new 0.6% software service fee and increased adoption of the Shenzhen T marketing tool. These are offset by the growth of new business models with lower initial monetization. Xu noted that while there is significant potential to increase the take rate, the company will maintain a balanced approach to ensure merchant health.

Ronald Keung asked about the widening gap between GMV and Customer Management Revenue (CMR) growth, questioning the take rate's trajectory and the specific measures being implemented to align them.

Answer

CEO Eddie Wu explained that the initial focus on user experience to drive GMV is now shifting towards monetization as market share stabilizes. He noted new ad tool 'Quanzhantui' will take 6-12 months to optimize. CFO Toby Xu added that a new 0.6% technology service fee on Taobao and Idle Fish, starting in September, will contribute to revenue, though smaller merchants will receive support.

Ronald Keung of Goldman Sachs asked for quantification of the AI-related revenue and its impact on Cloud Intelligence margins, particularly as the business mix shifts towards AI training and inference.

Answer

CEO Yongming Wu confirmed triple-digit AI revenue growth and noted an explosion in demand for inference. He expects this to contribute to higher margins but cautioned that significant CapEx investments over the next three years will have an amortized impact. Wu also stated that due to fierce competition, margins in China will likely differ from international markets and emphasized that scale effects from acquiring more customers will help optimize costs.

Ronald Keung with Goldman Sachs inquired about the express delivery industry's structure and outlook, specifically how growth convergence and pricing stabilization might shape the market in the year ahead and long-term. He also asked about ZTO's strategy for integrated logistics opportunities beyond core express delivery, including higher-end and overall supply chain services.

Answer

Chairman and CEO Meisong Lai stated that future market share will go to companies with scale, quality, efficiency, and cost advantages, emphasizing ZTO's focus on strengthening its core express business while balancing quality, volume, and profit. He highlighted ZTO's expansion into a comprehensive logistics ecosystem including LTL, cold chain, warehousing, and last-mile services, aiming to serve manufacturing and agriculture beyond e-commerce. CFO Huiping Yan reiterated the focus on strengthening core business, improving network partner relationships, and leveraging the installed base for broader logistics solutions, emphasizing a shift towards comprehensive capability.

Ronald Keung asked about the express delivery industry's structure and outlook, given the convergence in growth and stabilized pricing, specifically for the year ahead and the long-term market structure. He also inquired about ZTO's strategy for integrated logistics beyond express delivery, including higher-end and overall supply chain offerings.

Answer

Chairman and CEO Meisong Lai explained that stronger players with scale, quality, efficiency, and cost advantages will gain market share. He outlined ZTO's strategy to strengthen its core express delivery business, balance quality, volume, and profit, and improve interest allocation among network partners. He also detailed ZTO's expansion into comprehensive logistics, including LTL, cold chain, warehousing, and last-mile services, aiming to serve manufacturing, agriculture, and modern commerce, and to leverage product advantages from last-mile to ecosystem. CFO Huiping Yan reiterated the focus on scale, better services, and cost-effectiveness, emphasizing strengthening core business, improving network partner relationships, and expanding into the broader logistics market with LTL, cold chain, and warehouse cloud operations.

Ronald Keung inquired about ZTO's competitive strategy for the second quarter, specifically the level of investment planned to achieve volume growth targets after lagging the industry in Q1, and the potential impact on full-year profits. He also asked for details on the scale and targets for the company's rapidly growing retail and reverse logistics businesses.

Answer

CFO Huiping Yan, translating for Chairman Meisong Lai, affirmed ZTO's commitment to narrowing the volume growth gap with the industry while maintaining service quality and reasonable profits. Yan highlighted significant progress in retail and reverse logistics, with Q1 daily retail parcel volume up 45% to 6 million and reverse logistics volume surging over 150% to 3.5 million daily. She noted that while pricing is competitive, ZTO's early-mover advantage and deep relationships with e-commerce platforms create a high barrier to entry, and that growing this segment is key to improving courier earnings and network stability.

Ronald Keung inquired about ZTO's 2025 strategy, focusing on its priority for above-industry volume growth, the resulting impact on market share and pricing, and the balance with profitability. He also asked if the company's capital expenditure cycle has peaked and what the CapEx plan is for 2025.

Answer

Chairman Meisong Lai, translated by CFO Huiping Yan, confirmed a 2025 volume growth target of 20-24%, exceeding the industry's expected 15%, to expand market share while maintaining a focus on service quality and reasonable profit. CFO Huiping Yan added that the CapEx cycle has largely matured, with the 2025 plan targeting RMB 5.0 to 5.5 billion, a decrease from 2024's RMB 5.9 billion, primarily for facility upgrades and securing remaining land.

Ronald Keung inquired about ZTO's parcel volume growth lagging the industry, asking if the company would adjust its strategy in the second half to balance scale and profitability. He also questioned if there was further room for operating efficiency improvements or if cost-saving measures had been maximized.

Answer

Chairman and CEO Meisong Lai, translated by Sophie Li, explained that the slower growth was a deliberate strategy to avoid unprofitable, low-priced parcels and focus on service quality. He affirmed confidence in meeting the full-year 15-18% growth guidance, implying an acceleration in the second half. Regarding costs, Mr. Lai stated that while industry-wide productivity gains are slowing, ZTO has significant reserve capacity in its super sorting centers and expects to consistently release meaningful cost efficiencies going forward.

Ronald Keung asked about the main growth drivers behind the 22.3% year-over-year increase in fulfilled orders for Full Truck Alliance in Q3 2025, and requested an outlook for Q4 2025 and the next year.

Answer

Simon Chai, Chief Financing and Investment Officer, explained that solid user acquisition, higher engagement from existing users through product optimization, and robust growth from new businesses like less-than-truckload and entrusted services were the primary drivers. He expressed confidence in sustained order volume growth due to the platform's dominant position, increasing digitalization, and ongoing user ecosystem optimization.

Ronald Keung from Goldman Sachs inquired about the main growth drivers behind the 22% year-over-year increase in fulfilled orders for Full Truck Alliance in Q3 2025 and sought an outlook for Q4 2025 and the next year.

Answer

Simon Chai, Chief Financing and Investment Officer, attributed the solid growth to three factors: strong user acquisition through brand penetration and efficient marketing, higher engagement from existing users due to product optimization and new features like the cargo zone, and incremental growth from new businesses such as less-than-truckload and entrusted services. He expressed confidence in sustained order volume growth despite macro uncertainty, driven by dominant market position, digitalization, and ecosystem optimization.

Ronald Keung of Goldman Sachs asked about the key drivers for the strong 22.6% year-over-year growth in fulfilled orders, the impact of recent tariffs, and the company's outlook for full-year 2025 volume.

Answer

Chief Financing and Investment Officer Chong Cai attributed the strong order growth to an expanding high-quality user base, effective operational strategies improving user conversion, and growth in new businesses like Less-than-Truckload (LTL). He stated that no significant impact from tariffs has been observed due to the platform's focus on domestic freight and expressed optimism for the 2025 volume outlook.

Ronald Keung inquired about the primary drivers for the strong 24% year-over-year growth in fulfilled orders during Q4, which outpaced the market, and asked for the outlook on order volume growth for the full year 2025.

Answer

CFO Chong Cai attributed the robust growth to three key factors: successful new user acquisition strategies targeting direct shippers, effective operational enhancements like the premium cargo bidding function, and the expansion of new business lines such as less-than-truckload (LTL) services. He expressed confidence in maintaining healthy growth momentum into 2025, regardless of macroeconomic challenges.

Ronald Keung inquired about JD's commitment to investing in its food delivery business during its current loss-making phase, and the progress made in improving unit economics, including commissions and new business models like Seven Fresh Kitchen. He also asked about strategies to strengthen the competitive edge in general merchandise categories such as 3P, supermarket, health, and apparel, focusing on speed, selection, quality, and price.

Answer

CEO Sandy Xu stated that food delivery is a long-term strategy focused on healthy, sustainable growth and UE optimization, maintaining a rational investment approach. She highlighted Q3's healthy GMV and order volume growth, improved order mix, and sequential narrowing of operating loss due to UE improvements. For general merchandise, Ms. Xu emphasized sustained double-digit growth, particularly in supermarket, health, and fashion. She detailed strategies for supermarket categories, including enhancing user mind share, optimizing costs through supply chain, and collaborating with brands to build strong category competitiveness.

Ronald Keung at Goldman Sachs asked about the duration of JD.com's commitment to investing in its loss-making food delivery business for customer acquisition and the progress made in improving its economics, specifically regarding commissions and new business models like Seven Fresh Kitchen. He also inquired about JD.com's plans to strengthen its competitive edge in 3P general merchandise categories such as supermarket, health, and apparel, focusing on speed, selection, quality, and price.

Answer

CEO Sandy Xu stated that food delivery and on-demand retail are long-term strategies aimed at healthy, sustainable growth, with a focus on optimizing operational efficiency and improving unit economics (UE). She highlighted healthy GMV and order volume growth in Q3, a healthier order mix with rising meal orders, and a sequential narrowing of operating loss due to UE improvement. She mentioned the commission-free policy for merchants and limited advertising revenues, but noted progress in enriching supplies (high-quality restaurants) and improving subsidy efficiency. Sandy Xu also introduced the Seven Fresh Kitchen model as a supply chain innovation addressing food safety and boosting sales. For general merchandise, she emphasized sustained double-digit growth, particularly in supermarket, health, fashion, and home goods. Strategies include improving user mind share, optimizing costs through supply chain, and collaborating with brands to refine operations and build strong categories.

Ronald Keung of Goldman Sachs inquired about JD.com's strategy for its Electronics and Home Appliances category in the second half of 2025, given the dynamics of government trading programs and competition. He also asked about the company's long-term commitment to the competitive food delivery market and its strategy for achieving positive unit economics.

Answer

Sean Zhang, Head of IR, explained that JD.com will leverage its supply chain capabilities, product optimization, and service enhancements to sustain market share growth in electronics, independent of trading programs. Regarding food delivery, he positioned it as a long-term (5-20 year) strategic initiative deeply integrated with the core retail business. The focus is on quality, system capabilities, and rider welfare to generate synergies and gradually improve unit economics, despite near-term competitive intensity.

Ronald Keung asked about the medium-term outlook for JD.com's food delivery initiative and the strategy for sustaining the growth momentum seen in JD Retail, particularly in the apparel and general merchandise categories.

Answer

CEO Sandy Xu explained that food delivery is a natural, strategic extension of the core retail business, not a standalone venture. The current focus is on user experience, business scale, and ROI, with the goal of creating long-term synergies across the JD ecosystem. CFO Ian Shan added that the strength in general merchandise comes from relentless operational enhancements over the past two years, and the strategy for sustaining momentum involves further expanding brand selection, leveraging supply chain advantages, and driving user growth across the platform.

Ronald Keung inquired about JD.com's primary growth drivers for the upcoming year beyond the current strength in electronics, focusing on investment priorities for the supermarket category. He also asked about Q1 2025 trends for electronics and appliances amid government stimulus and how JD plans to maintain its category leadership.

Answer

CEO Sandy Xu explained that future growth will be propelled by the general merchandise category, particularly supermarkets and fashion, alongside continued user growth and platform ecosystem enhancements. For supermarkets, the focus is on improving procurement, sales capabilities, and fulfillment efficiency with JD Logistics. Regarding electronics, Ms. Xu noted a rebound in mobile and PC sales and a month-over-month recovery in home appliances in Q1. To solidify leadership, JD will enhance its trade-in services and leverage its supply chain to penetrate lower-tier markets.

Ronald Keung from Goldman Sachs asked about the optimal balance between growth and profitability for the second half of the year, given Q2's strong profit performance, and questioned how JD foresees the competitive landscape as rivals increasingly focus on GMV growth.

Answer

CFO Ian Shan stated that JD will maintain a dynamic balance, aiming for full-year revenue growth to outpace China's total retail sales while also achieving year-over-year profit growth. He attributed Q2's record profit to supply chain efficiencies. CEO Xu Ran added that JD's unique 1P and logistics capabilities create a strong competitive moat, and the company is confident in the long-term growth of China's e-commerce market.