SHANGHAI, China, Aug. 15, 2023 (GLOBE NEWSWIRE) -- Dada Nexus Limited (NASDAQ: DADA, “Dada” or the “Company”), China’s leading local on-demand delivery and retail platform, today announced its unaudited financial results for the second quarter ended June 30, 2023.

Second Quarter 2023 Highlights

• Total net revenues in the second quarter were RMB2,810.6 million, an increase of 23.2% year over year from RMB2,281.1 million in the same period of 2022.
• Total Gross Merchandise Volume (“GMV”) of JDDJ for the twelve months ended June 30, 2023 was RMB70.8 billion, an increase of 29.8% year over year from RMB54.6 billion in the same period of 2022.

“We are proud to announce our first-ever positive quarterly non-GAAP net income¹,” said Mr. Jeff He, President of Dada. “The remarkable milestone demonstrates the competitive viability of our unique business model and a result of our strategy to pursue high-quality growth. Convinced of the long-term market potential in the on-demand retail and delivery industry, we will continue to create sustainable value for all our stakeholders by deepening our partnership with retailers and brand owners, optimizing consumer experience, bringing flexible employment opportunities to riders, and strengthening our strategic cooperation with JD.com.”

“With consistent strategy and strong execution, we successfully turned profitable on a non-GAAP basis while maintaining strong growth momentum,” said Mr. Beck Chen, Chief Financial Officer of Dada. “In the second quarter, our revenue grew by over 23% year over year. Meanwhile, our non-GAAP net margin¹ improved by over 17 percentage points year over year.”

Second Quarter 2023 Financial Results        

Total net revenues were RMB2,810.6 million, an increase of 23.2% year over year from RMB2,281.1 million in the same period of 2022.

Note:

(1) Includes net revenues from (i) commission fee, and online advertising and marketing services of RMB897,223 and RMB1,185,197 for the three months ended June 30, 2022 and 2023, respectively; and (ii) fulfillment services and others of RMB563,389 and RMB644,968 for the three months ended June 30, 2022 and 2023, respectively.

• Net revenues generated from Dada Now increased by 20.2% from RMB815.6 million in the second quarter of 2022 to RMB980.4 million in the second quarter of 2023, mainly driven by the increases in order volume of intra-city delivery service to chain merchants.
• Net revenues generated from JDDJ increased by 24.9% from RMB1,465.5 million in the second quarter of 2022 to RMB1,830.2 million in the second quarter of 2023, mainly due to the increase in GMV. The increase in online marketing services revenue as a result of the increasing promotional activities launched by brand owners and retailers also contributed to the increment of the net revenues generated from JDDJ.

Total costs and expenses were RMB3,017.8 million, compared with RMB2,909.3 million in the same quarter of 2022.

• Operations and support costs were RMB1,716.8 million, compared with RMB1,431.3 million in the same quarter of 2022. The increase was primarily due to (i) an increase in rider cost as a result of increasing order volume for intra-city delivery services provided to various chain merchants, and (ii) an increase in costs for promotional activities. 
• Selling and marketing expenses were RMB1,136.7 million, compared with RMB1,190.2 million in the same quarter of 2022. The decrease was primarily due to (i) a decrease in advertising and marketing expenses, and (ii) a decrease in incentives to JDDJ consumers.
• General and administrative expenses were RMB56.4 million, compared with RMB99.9 million in the same quarter of 2022. The decrease was primarily due to efficient expense control measures and decreased share-based compensation expenses.
• Research and development expenses were RMB102.0 million, compared with RMB160.0 million in the same quarter of 2022. The decrease was mainly attributable to the decrease in research and development personnel cost.

Loss from operations was RMB197.0 million, compared with RMB608.7 million in the same quarter of 2022.

Non-GAAP loss from operations² was RMB28.6 million, compared with RMB424.2 million in the same quarter of 2022.

Net loss was RMB158.7 million, compared with RMB578.8 million in the same period of 2022.

Non-GAAP net income¹ was RMB8.4 million, compared with a loss of RMB395.6 million in the same period of 2022.

Net loss attributable to ordinary shareholders of Dada was RMB158.7 million, compared with RMB578.8 million in the same quarter of 2022.

Non-GAAP net income attributable to ordinary shareholders of Dada³ was RMB8.4 million, compared with a loss of RMB395.6 million in the same quarter of 2022.

Basic and diluted net loss per share was RMB0.15, compared with RMB0.60 for the second quarter of 2022.

Non-GAAP basic and diluted net income per share⁴ was RMB0.01, compared with a loss of RMB0.41 for the second quarter of 2022.

As of June 30, 2023, the Company had RMB3,945.1 million in cash, cash equivalents, restricted cash and short-term investments, a decrease from RMB4,370.4 million as of December 31, 2022.

Environment, Social Responsibility and Corporate Governance

• At the end of May, Dada published its 2022 ESG report. The report details Dada’s ESG commitments and key initiatives featuring shareholders, employees, users, partners, and the community. Dada continues to optimize its ESG practices and aims to share its sustainable development philosophy with the wider public by continuously enhancing the transparency of its disclosures.
• Dada recently added a dedicated Rider Care module on the Dada Now Rider Version App, where riders can find information about rider care events, exclusive benefits, among others. At the beginning of July, Dada rolled out Summer Care campaign for the 8^th consecutive year, providing riders with subsidies for working in hot weather, distributing heat stroke prevention kits, and setting up stations with medicine boxes, freezers, and other supplies across the country to enhance riders’ delivery experience.
• Dada has also extended care to our riders’ family. In May, Dada officially launched the College Scholarship program, which provides scholarships to riders’ children who have financial difficulty but excel academically.
• Hot weather poses challenge for all outdoor workers. In July, Dada cooperated with merchants and brand owners to set up “Free Water” stations in cities including Beijing and Shanghai to provide people exposed to high temperature with free drinking water.

Business Outlook

For the third quarter of 2023, Dada expects total net revenues to be between RMB2,800 million and RMB3,000 million, representing year-over-year growth of 17.6% to 26.0%. This outlook is based on information available as of the date of this press release and reflects the Company's current and preliminary expectations, which are subject to change in light of various uncertainties.

Conference Call

The Company will host a conference call to discuss the earnings at 9:30 p.m. Eastern Time on Tuesday, August 15, 2023 (9:30 a.m. Beijing time on Wednesday, August 16, 2023).

Please register in advance of the conference using the link provided below and dial in 10 minutes prior to the call.

PRE-REGISTER LINK: https://s1.c-conf.com/diamondpass/10032494-tehc6s.html

Upon registration, each participant will receive details for the conference call, including dial-in numbers, conference call passcode and a unique access PIN. To join the conference, please dial the number provided, enter the passcode followed by your PIN, and you will join the conference.

A telephone replay of the call will be available after the conclusion of the conference call through August 23, 2023.

Dial-in numbers for the replay are as follows:

A live and archived webcast of the conference call will be available on the Investor Relations section of Dada’s website at https://ir.imdada.cn/.

Use of Non-GAAP Financial Measures

The Company also uses certain non-GAAP financial measures in evaluating its business. For example, the Company uses non-GAAP income/(loss) from operations, non-GAAP operating margin, non-GAAP net income/(loss), non-GAAP net margin, non-GAAP net income/(loss) attributable to ordinary shareholders of Dada and non-GAAP net income/(loss) attributable to ordinary shareholders of Dada per share as supplemental measures to review and assess its financial and operating performance. The presentation of these non-GAAP financial measures is not intended to be considered in isolation, or as a substitute for the financial information prepared and presented in accordance with U.S. GAAP. Non-GAAP income/(loss) from operations is income/(loss) from operations excluding the impact of share-based compensation expenses and amortization of intangible assets resulting from business acquisition. Non-GAAP operating margin is non-GAAP income/(loss) from operations as a percentage of total net revenues. Non-GAAP net income/(loss) is net income/(loss) excluding the impact of share-based compensation expenses, amortization of intangible assets resulting from business acquisition and tax benefit from amortization of such intangible assets. Non-GAAP net margin is non-GAAP net income/(loss) as a percentage of total net revenues. Non-GAAP net income/(loss) attributable to ordinary shareholders of Dada is net income/(loss) attributable to ordinary shareholders of Dada excluding the impact of share-based compensation expenses, amortization of intangible assets resulting from business acquisition and tax benefit from amortization of such intangible assets. Non-GAAP net income/(loss) attributable to ordinary shareholders of Dada per share is non-GAAP net income/(loss) attributable to ordinary shareholders of Dada divided by weighted average number of shares used in calculating net income/(loss) per share.

The Company presents the non-GAAP financial measures because they are used by the Company’s management to evaluate the Company’s financial and operating performance and formulate business plans. Non-GAAP income/(loss) from operations and non-GAAP net income/(loss) enable the Company’s management to assess the Company’s financial and operating results without considering the impact of share-based compensation expenses, amortization of intangible assets resulting from business acquisition and tax benefit from amortization of such intangible assets. The Company also believes that the use of the non-GAAP measures facilitates investors’ assessment of the Company’s financial and operating performance.

The non-GAAP financial measures are not defined under U.S. GAAP and are not presented in accordance with U.S. GAAP. The non-GAAP financial measures have limitations as analytical tools. One of the key limitations of using non-GAAP income/(loss) from operations, non-GAAP net income/(loss), non-GAAP net income/(loss) attributable to ordinary shareholders of Dada, and non-GAAP net income/(loss) attributable to ordinary shareholders of Dada per share is that they do not reflect all items of income and expense that affect the Company’s operations. Share-based compensation expenses, amortization of intangible assets resulting from business acquisition and tax benefit from amortization of such intangible assets have been and may continue to be incurred in the Company’s business and is not reflected in the presentation of non-GAAP income/(loss) from operations, non-GAAP net income/(loss), non-GAAP net income/(loss) attributable to ordinary shareholders of Dada, and non-GAAP net income/(loss) attributable to ordinary shareholders of Dada per share. Further, the non-GAAP measures may differ from the non-GAAP measures used by other companies, including peer companies, potentially limiting the comparability of their financial results to the Company’s. In light of the foregoing limitations, the non-GAAP income/(loss) from operations, non-GAAP operating margin, non-GAAP net income/(loss), non-GAAP net margin, non-GAAP net income/(loss) attributable to ordinary shareholders of Dada and non-GAAP net income/(loss) attributable to ordinary shareholders of Dada per share for the period should not be considered in isolation from or as an alternative to income/(loss) from operations, operating margin, net income/(loss), net margin, net income/(loss) attributable to ordinary shareholders of Dada and net income/(loss) attributable to ordinary shareholders of Dada per share, or other financial measures prepared in accordance with U.S. GAAP.

The Company compensates for these limitations by reconciling the non-GAAP financial measures to the nearest U.S. GAAP performance measures, which should be considered when evaluating the Company’s performance. For reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measures, please see the section of the accompanying tables titled, “Reconciliations of GAAP and Non-GAAP Results.”

Forward-Looking Statements

This press release contains statements that may constitute “forward-looking” statements pursuant to the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as “will,” “expects,” “anticipates,” “aims,” “future,” “intends,” “plans,” “believes,” “estimates,” “likely to” and similar statements. Among other things, quotations in this announcement, contain forward-looking statements. Dada may also make written or oral forward-looking statements in its periodic reports to the U.S. Securities and Exchange Commission (the “SEC”), in its annual report to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Statements that are not historical facts, including statements about Dada’s beliefs, plans and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: Dada’s strategies; Dada’s future business development, financial condition and results of operations; Dada’s ability to maintain its relationship with major strategic investors; its ability to provide efficient on-demand delivery services and offer quality on-demand retail experience; its ability to maintain and enhance the recognition and reputation of its brands; general economic and business conditions globally and in China and assumptions underlying or related to any of the foregoing. Further information regarding these and other risks is included in Dada’s filings with the SEC. All information provided in this press release is as of the date of this press release, and Dada does not undertake any obligation to update any forward-looking statement, except as required under applicable law.

About Dada

Dada is a leading platform of local on-demand retail and delivery in China. It operates JDDJ, one of China’s largest local on-demand retail platforms for retailers and brand owners, and Dada Now, a leading local on-demand delivery platform open to merchants and individual senders across various industries and product categories. The Company’s two platforms are inter-connected and mutually beneficial. The Dada Now platform enables improved delivery experience for participants on the JDDJ platform through its readily accessible fulfillment solutions and strong on-demand delivery infrastructure. Meanwhile, the vast volume of on-demand delivery orders from the JDDJ platform increases order volume and density for the Dada Now platform.

For more information, please visit https://ir.imdada.cn/.

For investor inquiries, please contact:

Dada Nexus Limited
Ms. Caroline Dong
E-mail: ir@imdada.cn

Christensen

In China
Mr. Rene Vanguestaine
Phone: +86-178-1749 0483
E-mail: rene.vanguestaine@christensencomms.com

In US
Ms. Linda Bergkamp
Phone: +1-480-614-3004

E-mail: linda.bergkamp@christensencomms.com

For media inquiries, please contact:

Dada Nexus Limited
E-mail: PR@imdada.cn

Appendix I

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1 Non-GAAP net income (loss) represents net income (loss) excluding the impact of share-based compensation expenses, amortization of intangible assets resulting from business acquisitions and tax benefit from amortization of such intangible assets. Non-GAAP net margin equals non-GAAP net income (loss) divided by total net revenues. 
2 Non-GAAP income (loss) from operations represents income (loss) from operations excluding the impact of share-based compensation expenses and amortization of intangible assets resulting from business acquisition.
3 Non-GAAP net income (loss) attributable to ordinary shareholders of Dada is net income (loss) attributable to ordinary shareholders of Dada excluding the impact of share-based compensation expenses, amortization of intangible assets resulting from business acquisition and tax benefit from amortization of such intangible assets.
4 Non-GAAP net income (loss) per share is non-GAAP net income (loss) attributable to ordinary shareholders of Dada divided by weighted average number of shares used in calculating net loss per share.