Merchant Ecosystem Investment and Support

Mentioned across Q1–Q3 with emphasis on fee reductions, high‐quality merchant support programs, investments in technology and operational efficiency, and efforts to empower merchants (e.g., fee reduction programs, comprehensive support initiatives, and merchant compliance support) " " " " "

In Q4, similar initiatives continue with added measures such as the Merchant Rights Protection Committee, additional abnormal order alerts, and tailored logistics support for remote regions to further reduce costs and boost merchant efficiency " " "

Consistent focus with broadened measures and enhanced safeguards to further empower merchants and improve operational efficiency.

Supply Chain Transformation

Consistently highlighted in Q1–Q3, with investments in supply chain upgrades, technology integrations, and closer collaborations with merchants to enhance product quality and reduce operational costs (e.g., streamlined onboarding, technology-based quality control) " " " "

In Q4, the focus extends to tailored logistics support for remote and western regions and case-specific supply chain improvements that support a broader ecosystem strategy (including integration with merchant ecosystem support) " " "

Evolving from basic cost reduction toward a more integrated strategy that not only cuts costs but also drives innovation and quality improvements in supply chains.

Agricultural Focus

Emphasized across Q1–Q3 with initiatives such as Smart Agriculture Competitions, agricultural technology investments, modernizing supply chains for rural areas, and direct support for farmers to modernize production " " " "

In Q4, continued robust commitment with innovative programs and competitions, along with targeted efforts to upgrade regional supply chains and extend free shipping to remote regions, thereby supporting both farmers and consumers " " "

Consistently prioritized with a slight shift toward integrating agriculture with enhanced logistical support and consumer-centric promotional measures, reinforcing its long-term strategic impact.

Intensifying Domestic and International Competition

Repeatedly addressed in Q1–Q3 as a major challenge affecting revenue growth and cost structures, with management acknowledging heightened domestic pressures and competitive uncertainties in global markets " " " "

Q4 reiterates these challenges with renewed emphasis on refining strategies, enhancing operational efficiencies, and implementing innovative business models despite the intensifying competitive landscape, both domestically and internationally " "

Persistently acknowledged; while external pressures remain high, the strategy is shifting toward proactive adaptation and strategic investment to mitigate competitive impacts.

Global Expansion and External Macroeconomic Challenges

In Q1–Q3, global expansion was treated as an exploration phase with focus on supply chain improvements, service and compliance investments, and cautious optimism amid evolving regulatory and macro pressures in global markets " " " "

In Q4, there is a reinforced commitment to expanding international presence through localized supply chain solutions and innovative business models while proactively adapting to accelerating macroeconomic and regulatory challenges " "

Growing sophistication in addressing external uncertainties, marked by an expanded focus on localized strategies and compliance, aiming to solidify long-term global competitive positioning.

Short-Term Profitability Pressure vs Long-Term Sustainable Growth

Across Q1–Q3, management described short-term profit pressures as an expected outcome of heavy investments in ecosystem development and market share expansion, with a clear emphasis on creating long-term value despite near-term fluctuations " " " "

In Q4, management continues to accept short-term profitability pressures as a strategic trade-off for building a robust, high-quality platform ecosystem that will drive long-term sustainable growth " "

Steadily maintained narrative that current profitability pressures are necessary investments for achieving enduring scalable growth.

Promotional Activities and Consumer Demand Dynamics

Q1–Q3 highlighted a variety of promotional events (e.g., Spring Festival promotions, Double 11 events, “10 billion program”) with a focus on driving consumer savings, accelerating online consumption, and stimulating demand across segments " " " " "

In Q4, promotional activities have reached record participation with initiatives like the upgraded super level savings initiative and 10 billion consumption vouchers, generating high order volumes and enhanced consumer satisfaction " "

Enhanced consumer engagement as promotional efforts continue to evolve, yielding record order volumes and adapting to increasingly diversified consumer demand.

Increased Compliance and Regulatory Investments

In Q1–Q3, the focus was on building compliance capabilities through investments in technology, merchant education, proactive engagement with regulators, and efforts to remove noncompliant actors, ensuring a safer platform environment " " " "

In Q4, similar initiatives persist, with additional trust and safety updates, structured merchant support policies, and expanded measures to ensure regulatory compliance and enhance consumer protection "

Ongoing and expanded focus on regulatory compliance, reflecting growing external demands and a strategic commitment to sustain high-quality and trustworthy platform operations.

Operational Efficiency and Cost Management

Addressed throughout Q1–Q3 via fee reduction programs, improvements in logistics (e.g., elimination of transshipment fees for remote orders), investments in technology and automation, and cost management measures that lowered expense ratios relative to revenue " " " " "

In Q4, while costs continue to rise due to increased fulfillment and processing expenses, new initiatives such as targeted logistics support and further fee reduction programs are introduced to drive double-digit order growth and improved operational metrics " "

Constant emphasis on balancing necessary investments with cost control measures; the strategy is evolving to leverage efficiency gains from targeted logistics and advanced cost management to sustain long-term operational health.