On March 26th, Beijing time, China's leading local instant retail and delivery platform, Dada Group (Nasdaq: DADA), released its performance for the fourth quarter and full year of 2023, with core indicators achieving steady growth. In the fourth quarter, Dada Group's total revenue was 2.75 billion yuan, and the adjusted net profit margin continued to optimize year-on-year, with profitability continuing to improve. Dada Express's revenue was 1.2 billion yuan, a year-on-year increase of 36%, exceeding market expectations. The GMV of Houda Channel increased by over 200% year-on-year. In 2023, the total revenue of Dada Group reached 10.51 billion yuan, a year-on-year increase of 12%. The announcement shows that the board of directors of Dada Group has approved the launch of a stock repurchase plan with a maximum of approximately RMB 300 million.
The two platforms under the umbrella continue to maintain efficient and coordinated development. In the fourth quarter, JD.com continues to deepen its cooperation with large chain merchants and empower more small and medium-sized businesses. As of the end of 2023, the number of JD Daojia business stores has exceeded 500000: from chain supermarkets to convenience stores, from 3C digital to home appliances and home furnishings, and then to alcohol, clothing, mother and baby... We continue to enrich the supply of merchants, optimize the platform ecosystem, focus on users, strengthen the construction of services to improve user experience, and meet the real-time consumption demand of consumers for "hourly delivery of all categories".
In the fourth quarter, Dada Express achieved a revenue of 1.2 billion yuan, a year-on-year increase of 36%, exceeding market expectations. The top 50 chain merchants that contributed to platform revenue in 2022 will continue to choose Dada Express as their strategic partner in 2023. The quality, cost, and efficiency of Dada Express's real-time fulfillment service have been widely recognized by merchants. The high-quality development of the business has also attracted more riders: in 2023, the platform's active riders exceeded 1.2 million, and the social and livelihood value of the platform's "employment reservoir" has further expanded.
It is worth noting that the board of directors of Dada Group has approved the launch of a stock repurchase plan, which uses its own funds to repurchase stocks worth up to RMB 300 million within the next two years. This stock repurchase plan demonstrates Dada Group's confidence in the future healthy and sustainable development prospects.
Comprehensively deepen collaboration with JD.com
The GMV of Houda Channel increased by over 200% year-on-year
With the comprehensive and continuous deepening of collaboration between Dada Group and JD Group, and the strengthening of capacity building in the field of instant retail, Houda has become an important part of JD's efforts to provide consumers with a more "fast, efficient" consumption experience. It is also an important part of collaborating with merchants and brand partners to address external challenges and achieve steady growth.
In the fourth quarter, JD Houda's monthly average ordering users increased by 50% year-on-year. Driven by the increase in click through rates on JD's homepage and the improvement in traffic distribution efficiency, the number of active users (DAU) of Houda Channel has increased by over 100% year-on-year, and the GMV of Houda Channel has increased by over 200% year-on-year. In addition, the GMV generated by actively screening users of Houda products through search has also maintained a steady growth momentum. More and more JD users are becoming accustomed to using the hourly delivery service, enjoying a more fast, more cost-effective real-time consumption experience. JD users' hourly delivery real-time retail mentality continues to improve.
According to data from JD Houda on New Year's Eve, Wahaha AD calcium milk, which frequently appeared in the Spring Festival Gala, saw a sales increase of over 16 times compared to last year's New Year's Eve during the program's broadcast period. Magic programs drove a 4.3 times year-on-year increase in poker sales, and sales of holiday snacks such as candy, melon seeds, and peanuts doubled and increased year-on-year. During the Spring Festival, the transportation capacity of Dada Express increased by nearly 20% compared to last year's Lunar New Year. A consumer from Jinan opened the JD app on New Year's Eve and placed an order from a nearby JD Wine World store on the homepage's Houda channel. After more than 20 minutes, a rider from Dada Express delivered the same type of liquor for the Spring Festival Gala to their doorstep.
More than 500000 online business stores
Assist merchants in achieving deterministic growth
In recent years, JD Daojia has continuously improved the operational efficiency and service capabilities of merchants by leveraging its core capabilities in digitalization and local supply chain collaboration, helping merchants achieve omnichannel growth, effectively promoting the integration of data and reality in various industries, and strengthening the construction of services that enhance user experience centered on users, meeting their diversified real-time consumption needs.
As of the end of 2023, the number of JD's door-to-home stores has exceeded 500000, with a year-on-year increase of over 100% compared to the end of 2022. While continuing to maintain deep cooperation with large chain merchants, it empowers more small and medium-sized businesses. In 2023, JD.com has cooperated with more than 90 of the top 100 supermarkets released by the China Chain Store Association (CCFA).
Since the fourth quarter, JD.com has continued to expand its cooperation with top chain convenience stores, with GMV from convenience stores increasing more than four times year-on-year. After JD Convenience Store, Meiyijia, Lawson and other commercial stores launched JD Home, the original 1-kilometer service range was expanded to 5 kilometers, effectively connecting the online and offline real-time retail ecosystem, and effectively promoting domestic demand growth. The 3C digital category continues to maintain rapid growth, with mobile phone brands such as OPPO and Samsung experiencing a year-on-year GMV growth of over 100% in the fourth quarter. The GMV of digital products has maintained a rapid growth of over 50% year-on-year, with significant growth in some electronic accessories. More than 10000 new home appliance and home furnishing stores have been added, among which JD.com has established partnerships with leading home appliance brands such as Panasonic and Boshi to provide consumers with differentiated products and integrated delivery and installation services. The GMV of the home appliance category increased by over 50% year-on-year in the fourth quarter, while the GMV of the home appliance category increased by nearly 100% year-on-year. Clothing and alcohol both maintained a rapid growth of over three times year-on-year.
Behind the sustained growth of merchants, it is inseparable from the precise technological empowerment of the Haibo system. As an omnichannel digital platform system, Haibo System can provide merchants with integrated operation management, order fulfillment optimization, data standardization and automation management capabilities, helping them achieve cost reduction, efficiency increase, and sales improvement. As of the end of 2023, the Haibo system has covered over 13000 stores, a year-on-year increase of over 40%. Despite a significant increase in the scale of cooperative merchants, the retention rate of merchants is still as high as about 90%. The Haibo system continues to iterate and has added an order risk control engine. By intelligently identifying false orders and real-time monitoring and warning, it improves the risk control capabilities and operational safety efficiency of merchants.
Instant delivery services maintain rapid growth
Stable employment and absorption of over 1.2 million active riders
In 2023, facing numerous challenges, Dada Express achieved its goal of high-quality growth for the whole year by pursuing the optimal solution of cost, efficiency, and experience. In the fourth quarter, Dada Express's revenue was 1.2 billion yuan, a year-on-year increase of 36%, exceeding market expectations. The ability to provide instant fulfillment services continues to gain recognition from merchants and users.
Over the past year, Dada Express has seized opportunities and continued to expand into the lower tier market. The platform has over 1.2 million active riders, a year-on-year increase of over 20%, further increasing flexible employment opportunities for workers and continuously leveraging the social and livelihood value of the platform's "employment reservoir". In the fourth quarter, chain merchants achieved high-quality growth, with a year-on-year increase of over 20% in delivery completion volume and a fulfillment rate of over 95%. Among them, the completion volume of beverage categories increased by more than 60% year-on-year, winning the "Best Strategic Partner Award" from Luckin Coffee, helping brands such as Bawang Tea Ji to grow rapidly. In the food category, the fourth quarter brought rapid growth to newly signed partners such as Tastin. It is worth noting that the top 50 chain merchants contributing to platform revenue in 2022 will continue to choose Dada Express as their strategic partner in 2023. The quality, cost, and efficiency of Dada Express's instant fulfillment service have been widely recognized by merchants. In the fourth quarter, under the optimization of pricing ability, the development of new professional market scenarios, and the continuous penetration of sinking markets, the completion volume of small and medium-sized merchants and personal businesses still increased by more than 20% compared to the high base of the same period in 2022.
Actively practicing social responsibility
ESG ratings have jumped for two consecutive years
In 2023, Dada Group will continue to strengthen ESG practices and create sustainable business value in environmental, social, and corporate governance.
In November 2023, the first group standard for the instant retail industry, "Terminology and Key Indicators of the Instant Retail Industry," led by the China Chain Store Association (CCFA), was officially released. JD Home and Dada Express participated in the drafting and formulation as core representatives, promoting the healthy and sustainable development of the instant retail industry. In recent years, Dada Group has actively promoted and led the standardization development of the industry, deeply participating in the drafting and formulation of "Retail Digital Terminology", "Key Indicators for Omnichannel Operation of Chain operated Retail Enterprises", and the first national standard for instant delivery in China, "Instant Delivery Service Specification".
Dada Group continues to promote the establishment of a rider care and rider rights protection system: from October 2023 to the end of February 2024, the "Warm Winter Plan" will distribute hundreds of thousands of sets of winter care supplies free of charge to Dada Express riders nationwide, investing approximately 100 million yuan in rider incentives and subsidies to effectively increase rider income; Over 500 knight care events were held throughout the year, and pharmaceutical companies continued to set up love medicine boxes nationwide. Energy stations, love freezers, and love stations were also added, providing free emergency and daily supplies for riders; Launch the "Knight Children Care Program" to provide scholarships and assistance to outstanding children of riders who are financially disadvantaged and have been admitted to universities; Ensure 100% coverage of commercial insurance for riders; We have received a letter of gratitude from relevant departments for providing active cooperation and support in formulating policies for new forms of employment for workers in the country.
In September 2023, Dada Group's ESG score in the S&P Global Corporate Sustainability Assessment (CSA) was 37, ranking among the top 16% of the global retail industry. In December, Morgan Stanley Capital International (MSCI), an international authoritative index agency, raised the ESG rating of the group to A, expressing full recognition of the sustainable and high-quality development ability of Dada Group. Dada Group achieved two consecutive years of ESG rating upgrades.
In the future, Dada Group will adhere to user centered, healthy, long-term and efficient development, and work together with ecological partners such as retailers, brand merchants, and riders to focus on developing digitalization, local supply chain integration, and real-time fulfillment capabilities. Through the integration of data and reality, it will continuously promote new consumption, help entities revitalize new energy, and expand employment opportunities.