• Total Net Revenues (Q4 2024): RMB33.2 billion, compared with RMB34.7 billion in the prior year period.
• Gross Profit (Q4 2024): RMB7.6 billion, compared with RMB8.2 billion in the prior year period.
• Gross Margin (Q4 2024): 23.0%, compared with 23.7% in the prior year period.
• Total Operating Expenses (Q4 2024): RMB5.1 billion, compared with RMB4.9 billion in the prior year period.
• Operating Margin (Q4 2024): 8.6%, compared with 10.6% in the prior year period.
• Net Income Attributable to Shareholders (Q4 2024): RMB2.4 billion, compared with RMB3.0 billion in the prior year period.
• Net Margin Attributable to Shareholders (Q4 2024): 7.4%, compared with 8.5% in the prior year period.
• Non-GAAP Net Income Attributable to Shareholders (Q4 2024): RMB3.0 billion, compared with RMB3.2 billion in the prior year period.
• Cash and Cash Equivalents (as of Dec 31, 2024): RMB27.0 billion.
• Short-term Investments (as of Dec 31, 2024): RMB1.9 billion.
• Total Net Revenues (Full Year 2024): RMB108.4 billion, compared with RMB112.9 billion in the prior year.
• Gross Margin (Full Year 2024): 23.5%, compared with 22.8% in the prior year.
• Operating Margin (Full Year 2024): 8.5%, compared with 8.1% in the prior year.
• Net Income Attributable to Shareholders (Full Year 2024): RMB7.7 billion, compared with RMB8.1 billion in the prior year.
• Non-GAAP Net Income Attributable to Shareholders (Full Year 2024): RMB9.0 billion, compared with RMB9.5 billion in the prior year.
• Revenue Guidance (Q1 2025): Expected to be between RMB26.3 billion and RMB27.6 billion, representing a year-over-year decrease of approximately 5% to 0%.

• Warning! GuruFocus has detected 3 Warning Signs with BSP:SAPR3.

Release Date: February 21, 2025

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

Positive Points

• Vipshop Holdings Ltd (NYSE:VIPS) delivered results above expectations in the fourth quarter, indicating strong execution and adaptability.
• The apparel category experienced positive growth, contributing to 75% of total GMV, the highest in the company's history.
• Super VIP membership saw a 50% increase in active members, accounting for 51% of online spending in the fourth quarter.
• The company successfully introduced over 1,500 new brands, including partnerships with high-profile global brands.
• Vipshop Holdings Ltd (NYSE:VIPS) achieved an eight-year high gross margin of 23.5% for the full year, driven by the strong performance of the apparel business.

Negative Points

• Total net revenues for the fourth quarter decreased to RMB33.2 billion from RMB34.7 billion in the prior year period.
• Gross profit and operating margin both saw declines compared to the prior year period, indicating pressure on profitability.
• Marketing expenses increased by 10.3% year-over-year, impacting overall cost management.
• Net income attributable to Vipshop's shareholders decreased to RMB2.4 billion from RMB3.0 billion in the prior year period.
• The company anticipates a year-over-year decrease in total net revenues for the first quarter of 2025, reflecting ongoing market challenges.

Q & A Highlights

Q: Can management comment on the Q1 revenue guidance and recent consumer sentiment? A: Eric Shen, Co-Founder, Chairman, and CEO, stated that the business is on track within the guidance, with consumer sentiment slightly better than expected. The company is optimistic about the upcoming promotions in March, which will provide a clearer picture of the quarter's performance.

Q: What were the main drivers behind the Q4 outperformance? A: Eric Shen explained that the outperformance was due to improved consumer activity, normalized weather conditions aiding winter clothing sales, and proactive merchandising strategies. Promotions targeting high-value customers also contributed to growth.

Q: What is the outlook for gross margin and net profit margin in 2025? A: Eric Shen mentioned that the company achieved an eight-year high gross margin of 23.5% in 2024. They plan to invest a portion of the gross profit to incentivize brand partners, aiming for stable net profit margins while pursuing growth opportunities.

Q: How is Vipshop utilizing AI to improve business operations? A: Eric Shen highlighted that Vipshop is investing in AI applications for personalization, product recommendations, and customer service improvements. They are deploying AI internally to enhance productivity and efficiency, although no public-facing AI applications have been launched yet.

Q: What is the trend for ARPU and shopping frequency of Super VIP members? A: Eric Shen noted a slight decline in ARPU due to a 16% increase in active Super VIP customers. However, the ARPU for two-year customer cohorts remains resilient, indicating a healthy Super VIP customer base.

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