Vipshop(VIPS) - 2024 Q2 - Quarterly Results

Financial Performance - Total net revenues for Q2 2024 were RMB26.9 billion (US$3.7 billion), a decrease of 3.6% from RMB27.9 billion in the prior year period[2] - Gross profit increased by 2.2% year over year to RMB6.3 billion (US$872.6 million), with a gross margin of 23.6%, up from 22.2% in the prior year[6] - Net income attributable to shareholders for Q2 2024 was RMB1.9 billion (US$265.7 million), down from RMB2.1 billion in the prior year, resulting in a net margin of 7.2%[11] - Total net revenues for the three months ended June 30, 2024, were RMB 26,875,168, a decrease of 3.6% compared to RMB 27,879,300 for the same period in 2023[30] - Net income attributable to Vipshop's shareholders for the three months ended June 30, 2024, was RMB 1,931,207, a decrease of 7.9% from RMB 2,097,454 for the same period in 2023[30] - The company reported a diluted net income per ADS of $0.48 for the three months ended June 30, 2024, compared to $0.49 for the same period in 2023[31] - Non-GAAP net income attributable to Vipshop's shareholders for the three months ended June 30, 2024, was RMB 2,232,422, reflecting an increase of 16.5% compared to RMB 1,916,499 for the same period in 2023[30] - Non-GAAP net income attributable to Vipshop's shareholders for the three months ended June 30, 2024, was RMB 2.17 billion, compared to RMB 2.40 billion for the same period in 2023, representing a decline of approximately 9.58%[38] Customer and Order Metrics - The number of active customers decreased to 44.3 million from 45.6 million in the prior year period[3] - Total orders for Q2 2024 were 197.8 million, compared to 213.8 million in the prior year[3] Cash Flow and Liquidity - Free cash flow for Q2 2024 was negative RMB118.9 million (US$16.4 million), compared to a positive free cash inflow of RMB2.6 billion in the prior year[15] - Free cash flow for the six months ended June 30, 2024, was RMB 4,992,124, indicating strong liquidity and cash flow management[30] - Cash and cash equivalents as of June 30, 2024, were RMB21.6 billion (US$3.0 billion), with short-term investments of RMB1.9 billion (US$264.3 million)[14] - Cash and cash equivalents decreased from RMB 25.41 billion as of December 31, 2023, to RMB 21.03 billion as of June 30, 2024, a reduction of about 17.3%[36] Operating Expenses - Operating income increased by 16.5% year over year to RMB2.2 billion (US$307.2 million), with an operating margin of 8.3%[10] - Operating expenses for the three months ended June 30, 2024, totaled RMB 4,293,170, a decrease of 4.2% from RMB 4,479,734 for the same period in 2023[30] - Total operating expenses for the three months ended June 30, 2024, were RMB 332.1 million, down from RMB 381.5 million in the same period of 2023, reflecting a reduction of about 12.9%[34] - Fulfillment expenses for the three months ended June 30, 2024, were RMB 1.5 billion, compared to RMB 1.6 billion for the same period in 2023, indicating a decrease of approximately 6.25%[32] - Share-based compensation expenses for the three months ended June 30, 2024, were RMB 20.73 million, down from RMB 23.17 million in the same period of 2023, reflecting a decrease of about 10.6%[34] Future Outlook - For Q3 2024, the company expects total net revenues to be between RMB20.5 billion and RMB21.6 billion, reflecting a year-over-year decrease of approximately 10% to 5%[20] - The company anticipates continued growth in the online discount retail market in China, focusing on enhancing brand recognition and customer attraction strategies[24] - Vipshop's strategic plans include expanding fulfillment infrastructure and technology platforms to support future growth initiatives[26] Balance Sheet Highlights - Total current assets decreased from RMB 37.56 billion as of December 31, 2023, to RMB 31.75 billion as of June 30, 2024, a decline of approximately 15.5%[36] - Total liabilities decreased from RMB 33.76 billion as of December 31, 2023, to RMB 27.95 billion as of June 30, 2024, a reduction of approximately 17.2%[36] - The company’s total assets decreased from RMB 72.32 billion as of December 31, 2023, to RMB 67.65 billion as of June 30, 2024, a decline of approximately 6.2%[36] - The weighted average number of diluted shares for the three months ended June 30, 2024, was 110.74 million, compared to 111.82 million for the same period in 2023, indicating a decrease of about 0.97%[39]