• Revenue: RMB5.91 billion in Q4 2024, an 18.3% year-over-year increase.
• Gross Merchandise Volume (GMV): RMB6.55 billion in Q4 2024, an 18.4% year-over-year increase.
• Non-GAAP Net Profit: RMB120 million in Q4 2024, more than six times the RMB16 million in Q4 2023.
• Non-GAAP Net Profit Margin: 2% in Q4 2024, an increase of 1.7 percentage points year over year.
• GAAP Net Profit: RMB90 million in Q4 2024, a turnaround from a loss of RMB4.39 million in Q4 2023.
• GAAP Net Profit Margin: 1.6% in Q4 2024.
• Full-Year Revenue: RMB23.07 billion in 2024, a 15.5% year-over-year increase.
• Full-Year GMV: RMB25.56 billion in 2024, a 16.3% year-over-year increase.
• Full-Year Non-GAAP Net Profit: RMB420 million, an increase of more than eight times compared to RMB45 million in 2023.
• Full-Year GAAP Net Profit: RMB300 million, a significant turnaround from a loss of RMB91 million in 2023.
• Operating Cash Inflow: RMB190 million in Q4 2024.
• Full-Year Net Operating Cash Inflow: RMB930 million, a significant increase of RMB1.16 billion year over year.
• Full-Year Free Cash Flow: Positive at RMB830 million.
• Gross Profit Margin: 30.2% in Q4 2024, a decrease of 0.4 percentage points year over year.
• Fulfillment Cost Rate: 21.7% in Q4 2024, an improvement of 1.8 percentage points year over year.
• Marketing Expense Rate: 2.3% in Q4 2024, an increase of 0.2 percentage points year over year.
• Cash and Cash Equivalents: RMB4.45 billion as of the end of Q4 2024.

• Warning! GuruFocus has detected 3 Warning Sign with DDL.

Release Date: March 06, 2025

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

Positive Points

• Dingdong (Cayman) Ltd achieved non-GAAP profitability for the ninth consecutive quarter and GAAP profitability for the fourth consecutive quarter.
• The company reported a significant year-over-year revenue growth of 18.3% in Q4 2024, reaching RMB5.91 billion.
• User engagement improved with the average number of monthly transacting users increasing by 16.1% year over year.
• Dingdong expanded its frontline fulfillment station network, opening 130 new stations in 2024, surpassing their annual target.
• The company reported a positive net operating cash inflow for six consecutive quarters, reaching RMB190 million in Q4 2024.

Negative Points

• Gross profit margin decreased by 0.4 percentage points year over year to 30.2%.
• The marketing expense rate increased by 0.2 percentage points compared to the previous year.
• The company anticipates more intense competition in 2025, which may impact their focus on quality and long-term competitiveness.
• The fulfillment cost rate, although improved, still stands at 21.7%, indicating room for further optimization.
• Despite profitability, the company is transitioning from short-term scale and profitability to focusing on quality, which may pose challenges.

Q & A Highlights

Q: Can you discuss the importance of producing quality products and the strategy for developing high-quality items? Could you provide examples of collaboration with suppliers? A: (Changlin Liang, CEO) In Q4, we continued to achieve strong results, and our ongoing profitability has given us confidence to make changes. We aim to collaborate with like-minded partners to create greater value for consumers, moving beyond traditional supplier-retailer relationships. For example, our partnership with a professional breeding cooperative in Jingjiang has led to shared success, with sales of Dingdong customized fresh free-range chicken reaching RMB40 million, a 30% year-over-year increase.

Q: Does the company have examples of developing strong products using its own supply chain, given its own factory for food research, development, production, and processing? A: (Changlin Liang, CEO) Dingdong's core strategy centers around product development capabilities. Our self-operated factories, like the [Guyi] factory, support this by transitioning from a supply chain company to a product brand company. Our private label, Liang Xin Jiang Ren, develops regional specialties and traditional flavors. Our products are available in over 30 countries and regions, distributed through channels like Lianhua and JD7Fresh in China.

Q: What are the key factors driving Dingdong's rapid performance growth? A: (Changlin Liang, CEO) The growth is fueled by increasing user penetration, improved conversion rates, and higher ARPU in existing regions. In Q4, the average number of monthly transacting users increased by 16.1% year-over-year, and the average monthly transaction conversion rate rose by 4.7 percentage points. User engagement also rose, with an average of 4.2 monthly orders, a 3% increase year-over-year.

Q: How has Dingdong's regional performance contributed to its overall expansion? A: (Changlin Liang, CEO) Jiangsu, Zhejiang, and Shanghai regions have shown rapid growth, driving our overall expansion. In Q4, GMV for Shanghai increased by 16.8% year-over-year, while Jiangsu and Zhejiang grew over 20%. Thirteen cities in these regions achieved over 30% year-over-year GMV growth. We opened 130 new frontline fulfillment stations in 2024, surpassing our annual target.

Q: What are Dingdong's financial highlights for Q4 2024? A: (Song Wang, CFO) Dingdong reported a GMV of RMB6.55 billion, an 18.4% year-over-year increase, and revenue of RMB5.91 billion, an 18.3% increase. Non-GAAP net profit was RMB120 million, with a net profit margin of 2%. GAAP net profit was RMB90 million, with a net profit margin of 1.6%. The operating net cash inflow was RMB190 million, marking six consecutive quarters of positive net cash inflow.

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