DDL

• Q3 2025 GMV was RMB 7.27 billion and revenue was RMB 6.66 billion, both slightly up year-on-year, marking highest ever quarterly GMV and revenue. Non-GAAP net profit was RMB 0.1 billion with 1.5% margin, GAAP net profit was RMB 0.08 billion with 1.2% margin.
• Good product system progress: In September, good products SKUs comprised 37.2% generating 44.7% of total GMV, up from earlier months. Monthly order conversion rate increased by 1.6 percentage points year-over-year, monthly ordering users grew by 4.1%. Average monthly order frequency reached 4.6x in Q3, up 4.9% year-over-year.
• Regional performance: GMV in Jiangsu, Chongqing and others continued upward trend. Shanghai maintained stable operations, Jiangsu and Chongqing sustained strong growth. 9 cities in the region (excluding recently expanded ones) had over 10% growth, Guangzhou grew over 60%.
• Introduced One Big, One Small, One World framework: One Big focuses on top-selling product strategy; One Small on frontline fulfillment stations in smaller cities; One World on international market expansion. In Q3, 40 new frontline fulfillment stations opened.
• B2B business grew 67.4% year-over-year. Focused on good product strategy, refining product lineup, enhancing supply chain, managing gross profit margins, optimizing services with on-time delivery rate at 97%, product negative review rate 0.04%, rider negative reviews 0.02%, average fulfillment time 36.3 minutes.

• Industry-wide competition in instant retail is intensifying. Dingdong is confident in forging a unique quality focused, efficient and resilient growth path through intense competition and in maintaining last year's scale and non-GAAP profitability in Q4.

In Q3 2025, Dingdong reported revenue of RMB 6.66 billion, a 1.9% year-over-year growth. GMV was RMB 7.27 billion, up 0.1% year-over-year. The B2B business continued to grow steadily with revenue expanding by 67.4% year-over-year, and its revenue share rose by 1.9 percentage points year-over-year. Gross profit margin was 28.9%, down 0.9 percentage points year-over-year. Fulfillment cost ratio was 21.5%, up by 0.1 percentage points compared to last year. Sales and marketing expense ratio was 1.9%, a decrease of 0.3 percentage points year-over-year. Combined G&A and R&D expenses represented 4.9% of revenue. Non-GAAP net profit was RMB 0.1 billion with a margin of 1.5%, while GAAP net profit was RMB 0.08 billion with a margin of 1.2%.

• Intense competition in the instant retail sector with platforms and offline merchants increasing investments to gain market share, which poses challenges.

Q: How does Dingdong view the current competitive landscape in the instant retail market, what challenges does it bring and are there new opportunities behind it?

A: Competition in instant retail is intense. Fresh groceries are highly competitive and valuable. Dingdong's path is to build differentiation via 4G strategy on user side (good products attract good users) and 1 inch wide, mile deep on supply chain side (focus on core areas, build unique supply chain capability). Focus on long-term efficiency and capability over short-term price and scale battles.

Q: Could you elaborate on the top selling product strategy, especially in conjunction with the top sellers from this year's third quarter summer sales campaign?

A: The top-selling product strategy shifts from channel distributor mindset to product manager mindset. Assess categories across 6 key dimensions: market size, supply chain capabilities, etc. Select promising targets and scale via centralized procurement, standardized quality control, etc. Summer campaign results like [indiscernible] generated nearly RMB 15 million in GMV, 22-fold year-over-year growth, validating the strategy. Top-selling products deepen brand recognition, increase repurchase rates and brand loyalty.