Total Net Revenues

Q2 2025

no prior guidance

Expected to be between RMB 25.5 billion and RMB 26.9 billion, representing a year-over-year decrease of approximately 5% to 7% "

no prior guidance

SVIP Membership Growth and Customer Engagement

In Q2–Q4, management highlighted double-digit growth (11% in Q2/Q3 and 50% in Q4) with strong customer engagement initiatives and tailored promotions ( " " " " " " )

Q1 2025 reported an 18% year‐over‐year increase in active SVIP members, with initiatives involving merchandising strategies and leveraging AI to drive engagement ( " " " )

Continued robust growth with enhanced tech-driven engagement strategies.

ARPU Dilution and Decline in Spending Frequency

Across Q2–Q4, management noted ARPU dilution due to the influx of new SVIP members with a slower ramp-up and a manageable decline in spending frequency, with stable performance in long‐term cohorts ( " " " " )

Q1 2025 similarly highlights ARPU dilution from new members and underscores initiatives such as exclusive merchandising to boost spending frequency, particularly among longer‐term members ( " )

Consistent dilution challenges, with renewed focus on mitigating impacts via enhanced merchandising.

Operational Efficiency and Margin Management

In Q2–Q4, discussions emphasized disciplined cost management, process optimization (including AI applications), and steady margins despite challenges ( " " " " " " )

Q1 2025 reiterated a focus on operational efficiency through team restructuring, maintaining healthy—though modestly softened—margins, and disciplined marketing expense management ( " " " )

Ongoing cost discipline with added restructuring to further enhance efficiency.

Consumer Sentiment and GMV Growth Trends

Q2 reported muted sentiment; Q3 described cautious consumer behavior with conservative guidance; Q4 observed modest improvement and normalized shopping trends ( " " " " " )

Q1 2025 noted improved sentiment in early months with optimism for GMV recovery in the latter half of the year, alongside stronger SVIP contribution to online spending ( " " )

Shift from caution toward a modestly positive outlook with expectation of a mid‐year GMV rebound.

Competitive Pressure and Market Share Challenges

Q2 and Q3 pointed to heightened competition and sensitivity around standardized items, while Q4 had no specific mention; competitive pressures were indirectly inferred ( " " )

Q1 2025 explicitly acknowledged a hypercompetitive environment and reinforced the focus on its core value proposition of deep-discount retail to safeguard market share ( " )

Consistent competitive concerns, now coupled with a renewed emphasis on value differentiation.

Technology and AI Integration

Q2 discussed significant investments in AI and technology upgrades; Q3 emphasized AI for search, recommendations, and content automation; Q4 expanded on broad internal AI applications ( " " " " )

Q1 2025 detailed further enhancements in AI-powered algorithms for improved search, personalized recommendations, and customer service, underscoring a commitment to integrated technology solutions ( " )

Ongoing deepening of AI integration across functions to boost customer experience and operational productivity.

Increased Marketing Expenses and Efficiency Trade-offs

Q2 saw a reduction in marketing expenses, Q3 recorded a modest decline in absolute terms with stable revenue share, and Q4 experienced an increase (up to 2.8% of revenue) ( " " " )

Q1 2025 reported a 6.0% YoY increase in marketing spend to RMB 732.1 million (2.8% of revenue), with emphasis on ROI and diversified channel investments for sustainable growth ( " " )

An upward trend in marketing spend, with strategic focus on efficiency and customer value rather than scale alone.

Promotional Event Performance and Cross-Category Spending Potential

Q3 highlighted extended promotional events (e.g., 28 days of Singles Day) and strong Made for VIP performance; Q4 added cross-category initiatives targeting family shoppers, while Q2 did not specifically address this ( " " " " )

Q1 2025 underscored normalized promotional behaviors and deepened focus on cross-category purchasing by leveraging family shopper trends and exclusive merchandising offers ( " " )

Continued emphasis on promotions with a strategic pivot toward boosting cross-category purchase potential.

Short-Term Growth Volatility and Turnaround Uncertainty

Q2 and Q3 discussed volatility and a cautious near-term outlook; Q4 did not focus on this aspect directly, though expectations remained tempered by external factors ( " " " " )

Q1 2025 acknowledged short-term growth volatility and turnaround uncertainty but reaffirmed confidence in strategic execution and team agility to navigate these challenges ( " " )

A persistent theme of short-term volatility paired with reinforced strategic confidence in driving a turnaround.

Macroeconomic and Industry Competition Uncertainty

Q2 highlighted muted consumption amid macro uncertainty and intense low-price competition; Q3 added caution around recovery outlook; Q4 recognized uncertainty but maintained a positive long-term view ( " " " " )

Q1 2025 reiterated the challenges stemming from ongoing macroeconomic headwinds while expressing confidence in maintaining stable margins and focusing on differentiated strategies ( " " )

Continued headwinds balanced by strategic measures aimed at sustaining profitability and mitigating competition risks.

Shift from Pursuing Scale to Focusing on Quality Brand Merchandise

Q2 initiated the strategic shift toward quality, trimming lower-quality offerings; Q3 emphasized curated, high-value offerings including the Made for VIP line; Q4 reinforced this focus with deepened brand partnerships and merchandise quality ( " " " " " )

Q1 2025 reaffirmed the commitment to this shift, stressing a focus on unique, quality off-price offerings and leveraging customer insights to drive strong brand engagement ( " " )

A firmly established strategy with continuous emphasis on quality over sheer scale to drive sustainable growth.